Not before time, "green" industry has recognised that if you equate environmental friendliness with the ability to save a lot of money, businesses suddenly become much keener. Bolstering the company brand and impressing customers, while also having a board-pleasing impact on the bottom line, is a winning formula.
British businesses fritter away close to £7m a day, according to the Carbon Trust. Combining such statistics with its own findings, utility company E.ON, which is currently running a campaign to change employee behaviour in small businesses, estimates that an average office wastes £6,000 a year and 3.36 tonnes of carbon dioxide through sloppy practices.
E.ON has found the biggest problem is changing the company mindset when it comes to being more frugal. Almost 80% of workers admit to failing to transfer good practice at home to the office. Worse still, almost two-thirds currently ignore company policy on environmental initiatives, a trend especially pronounced among SMEs.
Waste awareness
"At home, consumers seem to be more aware of wastage and will make a greater effort to switch off a light, turn off a dripping tap or recycle, but in the office this consciousness is less pronounced," says Roger Papworth, programme delivery manager at sustainable business consultancy Envirowise. People feel less accountable and less visible at work, plus they're not paying for the services.
Businesses are now more cash-strapped than ever and energy costs continue to soar. If employee apathy is to be overcome, green initiatives must be driven from the top. A costings wake-up call spurs even the smallest enterprise into action.
Typically, energy constitutes the second biggest business expense after staff salaries. Simple measures such as turning down the heating or the air conditioning by just one or two degrees can save 6%–8% on a company's overall energy costs. Be more selective in use of office lighting and that's another 10% saving. "If a business is spending £500,000 a year on energy consumption, a 20% reduction in power use adds up to a £100,000 saving," says Tom Fidell, an energy conservation engineer at energyteam, which specialises in advising businesses in this area.
Happily, the biggest savings can be achieved for free or very little. The key to change is educating and motivating employees to cut down on their energy wastage — encouraging them to switch off lights, for example.
"Heating should not need to be set above 19 degrees, nor air conditioning below 24 degrees," Fidell says. "It is absurd that people have to wear jumpers at work in the summer because the office has been overcooled. What happened to adapting to the seasons?"
When it comes to lighting, companies may need to invest a small amount in new controls that allow the system to be "zoned" so that those sitting near the windows can switch off, or so individuals or small teams working late don't incur the costs of lighting the entire floor. "Its just good housekeeping, but it can make a substantial difference," Fidell says. For additional savings, when lighting is replaced, go for small-diameter, high-frequency fluorescent tubes. Other well-documented responsible work practices include replacing old electronic equipment with Energy Star-rated devices and turning off machines that aren't in use.
"One of the quickest, cheapest and easiest fixes to power wastage is having the ability to regulate when machines are on and off," says Francis West, CEO at FWCS, a supplier of green money-saving IT solutions for small businesses. "It's a myth that switching a device off and on uses more power," he says, pointing to recent research conducted for Fujitsu-Siemens, which shows that if a PC is switched off at 6pm or 7pm then on again at 8am a company could save £100 a year per PC, compared to leaving the systems on standby. "And that was before recent increases in energy costs," West notes.
"For an organisation with 120 machines that's a saving of £12,000 a year, equating to 53 new machines, new training, or a staff holiday — however you want to position it," he says.
A rack of three servers draws the same power as 20 average households. Generating a lot of heat, these high-performing processors need to be cooled. While some servers, such as those running email, may need to stay on around the clock, this may not be the case for all of them.
Cost management
If businesses want to reduce energy costs further, they can also investigate switching supplier (see surviving recession, page 5, for advice on this). This won't make them greener, but it will continue to drive energy management in the right direction. Market analyst Datamonitor estimates that while energy suppliers may lose money on new business customers in the first year, by offering them great deals to encourage them to switch, they make 32% profit from them in the next by moving their rates. "Only a small proportion of SMEs have ever switched energy supplier and we estimate that UK SMEs are overpaying by £2bn each year," says Jonathan Elliott, MD of Make It Cheaper, a price comparison and switching service for SMEs.
For FWCS's West, who practises green behaviour across his own business, it isn't just cost that drives his zeal for reducing wastage. His epiphany came when he saw Al Gore's documentary on global warming, An Inconvenient Truth. "It rocked me to my foundation. You can't watch the film without getting a profound sense of our individual responsibility for preserving the planet for our children's children," he says.
Being seen to be green is another important driver in changing businesses' behaviour. From legal firms to shops and hotels, organisations are keen to demonstrate their own social responsibility because it helps strengthen their brand. If their customers include public sector organisations or large businesses, the ability to demonstrate green credentials could be crucial to their ability to maintain key relationships, as these clients strive to meet their own sustainability targets.
Tightening legislation is also heaping on the pressure to save the planet from within the workplace. By 2010, any business with an energy spend of £500,000 a year will have to participate in the government's compulsory carbon trading scheme, while the new energy performance certificates (EPCs) coming into effect this October will affect businesses of all sizes. Firms will face fines of up to £5,000 if they fail to present a valid EPC when building, selling, leasing or modifying their premises.
And from January, air-conditioning systems using 250kW and above will need to be surveyed. "All of this helps drive awareness and focus the mind," says energyteam's Fidell.
Without that awareness, change is hard to effect.
