“Responsible business does not give up on its environmental responsibilities even in difficult times”

Photo by: Bidstrup / iStock

Not every business in Russia has yet realised that energy efficiency is an important competitive advantage. However, this awareness is gradually catching on in more and more businesses. The reasons can be divided into three groups: compliance, economic incentives and ethical arguments.

The first group includes requirements for organisations with state and municipal participation, environmental legislation and best available technologies (BAT) compliance requirements. In addition, exporters feel the pressure of carbon regulation in global markets, and it is gradually emerging in Russia as well, although the requirements are only relevant so far in the Sakhalin experiment.The economic arguments include primarily the reduction of fuel and energy costs, control of production costs, and thus increased price competitiveness, as well as benefits and preferences. The latter include property tax exemptions, accelerated depreciation and tax investment credit for the use of energy efficient equipment on the relevant list, as well as incentive mechanisms for enterprises implementing technological modernisation projects and the availability of green financial instruments, namely loans with a reduced interest rate, greater availability of investment from responsible investors and financial institutions for those who improve energy efficiency.

Finally, ethical arguments also play a role. It could be argued that resource efficiency, including energy efficiency, is the backbone of modern economic systems, and the national regulation of all states, as well as international regulation in world markets, is gradually being built in this logic. This applies to Europe, Asia, the Middle East, the Americas and Russia.

Energy efficiency is a mandatory attribute of component E (environment) describing the environmental and climate footprint, in a set of ESG — socio-environmental and management voluntary business commitments. ESG principles have already gained traction among Russian companies, and responsible business does not give up on them in the most challenging times.

Cover photo: MmeEmil / iStock