Photo by: Mickis-Fotowelt / iStock
Perhaps the clearest arguments for businesses to improve energy efficiency are economic. These are arguments that can be expressed in terms of additional revenues or reduced costs to the business. There are three main economic arguments.
The first is cost control. The higher the share of energy in the cost of production, the more obvious it is that improving energy efficiency will help to control the cost of a product and make it more price competitive.
The second is green finance. There is a gradual opportunity to monetise efforts to reduce energy intensity in Russia. A taxonomy of green and transition projects has been adopted and the necessary infrastructure is virtually in place. The implementation of climate projects (i.e. those that lead to the reduction of greenhouse gas emissions, including energy efficiency projects) will gradually be rewarded with monetary compensation. So far, though, of course, this compensation is small because of the low price of a tonne of CO2-equivalent on the market. It is not a particularly economically weighty argument, but it is important reputationally, including in the eyes of responsible investors. A company that proves that it implements energy efficient projects will find it easier to bid for external investment. And green financial instruments already exist and are developing in Russia.
The third argument is cost savings. Here everything is obvious: less losses, higher productivity in terms of energy costs, and lower fuel and energy bills. And so it is every month. In addition, improving energy efficiency is directly linked to reducing the negative impact on the environment, and thus possible payments for this impact. This is the way to improve operational efficiency.
Cover photo: NATALIA DE LA RUBIA / iStock
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