Good eco-sense is good business sense too

February 2, 2010

JulietDavenport- Juliet Davenport is founder and CEO of Good Energy, a renewable electricity supplier. She is unique in being the only female founder in the UK of an energy supply business, traditionally a male-dominated sector. The opinions expressed are her own. Reuters will host a “follow-the-sun” live blog on Monday, March 8, 2010, International Women’s Day. Please tune in. -

Regardless of their views on climate change and man’s contribution to it, most business leaders agree on one point – as fossil fuels get scarcer and the UK decarbonises our economy, our energy prices will continue to rise.

The UK’s recent cold snap gave us a foretaste of what we could be in for – with some businesses having their gas supplies cut to relieve pressure on pipelines – although it appears that the widely reported claim that the UK had just eight days’ gas supply left was political bluster and scaremongering.

The Department of Business, Energy and Regulatory Reform’s 2008 Energy Markets Outlook projects that the UK could rely on imports for 80 percent of its gas needs by 2020, with huge implications for cost and energy security – and that income pouring out of the country.  And the International Energy Association forecasts serious energy “crunches” occurring within the next 10 years.

As all effective CEOs know, good business isn’t just about keeping your costs down, it’s about forecasting your costs with a degree of certainty.

When it comes to energy, investing in decentralised renewable generation doesn’t just give businesses good environmental credentials – increasingly important for today’s consumers – but control over their energy costs, with accompanying financial and competitive benefits.

Such investments – where the fuel, be it wind, sunshine, biomass or water, is effectively free – can enable a firm to set its energy prices with relative certainty for the next 20 years, providing an effective hedge against the unpredictable gas and electricity markets.

So, it’s not surprising then that the UK’s more enlightened and forward thinking businesses are taking steps now to safeguard their future energy security, by investing in their own renewable generation capacity.

BT is a prime example: its wind farm initiative, Wind for change, claims to be the UK’s biggest corporate green energy project outside the energy sector. It’s aiming to meet a quarter of its very large electricity needs from renewables by 2016 – that’d be enough to power 122,000 homes.

But it isn’t just the big behemoths that are sitting up and taking notice. Among Good Energy’s community of over 1000 independent generators are several small businesses who recognise that generating their own power makes sound commercial sense.

For example, Mackie’s, an ice cream manufacturer based in Aberdeenshire, has three wind turbines generating 7,500 MWh a year – the equivalent to powering 2,000 homes.  This powers their factory and provides them with an additional income from their land for power that they export.

And what is good business sense, is good for the economy too. We’ve been hearing lots lately about how the green sector is going to lead the UK out of recession.

A recent report from the Renewable Energy Association strengthens the case for green economic investment by crunching some numbers – it forecasts that by 2020 the UK’s trade balance could benefit to the tune of 12.6 billion pounds a year simply by implementing better energy efficiency and investment in renewables.

Worth thinking about?  Rather than British Steel or British Coal – we should start thinking about British Wind and British Sun as a future resource base for the UK – it’s a shame to waste cash from UK industry on someone else’s oil and gas.

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