B4E, the Business for Environment Global Summit, is the world's leading international conference for dialogue and business-driven action for the environment. The summit addresses the most urgent environmental challenges facing the world today. Important topics on the agenda include resource efficiency, renewable energies, new business models and climate policy and strategies. CEOs and senior executives join leaders from government, international agencies, NGOs and media to discuss environmental issues, forge partnerships and explore innovative solutions for a greener future.
Mads Pinnerup is Vice President of Business Support and Focus Businesses of the Heating Segment – a segment within the global group Danfoss A/S, which produces and sells an extensive range of energy-efficient products and services. Mads Pinnerup joined Danfoss in 1997 and has held various positions within marketing, product management, and strategy before being appointed Vice President and divisional CFO of the Heating Segment in 2004.
After studies Mr Gustafsson has held a number of positions within Volvo Bus Corporation, ranging from the product development to marketing. The majority of the time has been devoted to product planning issues. Since 2010 has Mr Gustafsson been responsible for Public Affairs. Mr Gustafsson has also during this time acted as senior advisor for Volvo buses electro mobility projects.
Junio Valerio is a veteran of the carbon market, having worked for over seven years in this industry. For the last three, he has worked in London for the South Pole Group, across a number of products, sectors and initiatives. More recently, he has been focusing on the impact of energy-intensive sectors and the use of renewable energy in the ITC sector. He holds a Master in Security Studies from the University of Aberystwyth and is a huge Arsenal fan.
The upcoming G20 Summit in Turkey will be an important moment to reframe energy productivity financing as an infrastructure investment.
Last year’s G20 summit meeting in Brisbane resulted in an energy efficiency action plan, which included financing, however it framed finance as ‘a different investment class to major infrastructure projects’. This framing is based on the disaggregation of often small-scale efficiency opportunities, which although a common challenge, it is one which is being overcome. For example, this year saw the first ever securitization of energy efficiency building retrofits in the USA. Such transactions help to reduce risk, uncertainty, and deal costs. These barriers need to be overcome otherwise, the McKinsey cost curve will forever haunt energy efficiency!
Progress will also require efficiency to be put on a par with major infrastructure projects. This means changes from the powers that drive efficiency finance. Firstly, governments need to calculate the return on efficiency as a comparable investment to projects such as transport and power supply. And then provide financing through large-scale procurement opportunities in order to attract private sector investment at scale. Secondly, private sector institutions need to step up and provide the majority of the finance due to the enormous need for spending in order to realize the potential of the efficiency market and its contribution to tackling climate change. The International Energy Agency estimates that $13 trillion dollars will need to be spent globally on efficiency between now and 2035 to limit emissions to a 2 degree pathway. Thirdly, public banks, including national, regional and multi-lateral, need to mainstream efficiency into their investment portfolios so that such investments do not perpetuate inefficiency but instead help to close the efficiency finance gap.
While the G20 Summit in Turkey is unlikely to designate a specific amount of efficiency investment, it can clarify the contribution that governments, the private sector and public banks need to play and it can recognize efficiency as an infrastructure investment on par with traditional infrastructure. Until efficiency is understood in this way then financing will be stuck in a paradigm of under-investment, and is unlikely to deliver the productivity benefits so often cited and much needed.
Dan Hamza-Goodacre is Director of Energy Efficiency at ClimateWorks. ClimateWorks mobilizes philanthropy to solve the climate crisis and ensure a prosperous future. Dan will chair both the Manufacturing and Financing Global Energy Productivity panels at the 5th B4E Climate Summit, which will be held in London 9-10 September 2015.
The outcome of the 2012 presidential election in the US, which saw President Barack Obama fight to win a second term against the Republican Mitt Romney, was uncertain. Obama’s record-breaking fundraising was no guarantee of success in the face of challenging domestic issues such as how the US would respond to the economic downturn or the future of the Affordable Care Act.
But one man did call the result correctly. In fact, the American statistician and writer Nate Silver – who started his career analysing and forecasting the performance and career development of Major League Baseball players – correctly predicted the winner in all US states.
How? Well, Silver is a self-professed data geek. He has built systems that give him access to all the data he needs to make the most accurate predictions – whether in forecasting election results or estimating how many home runs a specific player is likely to make in a year. And crucially, he understands how to read that data.
As famous as Silver has become as something of a data journalist, he’s not alone in being able to understand data and use it for positive results. With advances in connectivity and the power of technology to gather data, we have more information at our fingertips than ever before. According to IBM, by 2020 there will be 300 times more information available to use than there was in 2005 – a figure it puts at 43 trillion gigabytes of data.
Corporate sustainability managers are beginning to realise the benefits such information can have in supporting their environmental and social impact reduction efforts. Typically, the biggest impact a company can have on the planet sits outside its sphere of influence, along its supply chain. It is not uncommon for more than 80% of a company’s total end-to-end carbon impact to be found within the operations of its suppliers – and for its direct operational impacts to account for as little as 5% in many instances.
For these big businesses, their supply is large and complex, made up of tens of thousands of suppliers across the world spending hundreds of millions of pounds. Understanding who those suppliers are and what impact they are having on the planet is crucially important if the company is to reduce its overall impact.
But it’s not easy. In fact, without the right data and information on those suppliers, it’s very difficult indeed.
Companies have only just started scratching the surface in understanding how they can gather, process, analyse and make the best use of data that will help them save money, make money, build more resilient supply chains and ultimately become more sustainable.
More and more organisations are turning to software providers to help them get to grips with the data that will help to unlock these savings. For example, the hotel and restaurant group – and owner of Costa, the high-street coffee chain – Whitbread has been working with cr360’s supply chain software solution to help meet ambitious new sustainability targets. In May 2015, the company reassessed its CSR goals and developed responsible sourcing and commodity policies to ensure that by 2020 all of its suppliers improve their sustainability credentials and meet the standards set by the business.
The agile technology offers a centralised way to collate and manage data, and report on the sustainability performance of suppliers. By inviting suppliers to answer a series of questions, the software can automatically analyse the responses and identify any potential risks within the supply chain. Now, with a bird’s-eye-view of its supply chain hotspots, Whitbread’s sustainability team has access to clear and consistent information that allows them to work closely with suppliers to resolve any issues and to educate them about the company’s sourcing and commodity standards.
Of course, the software can also be used to encourage environmental impact reduction by asking suppliers to log carbon, energy, waste and water data – and identifying areas where improvements and savings could be made. The cr360 system allows you to collect all sorts of information – from code of conduct surveys to performance metrics for Scope 3 carbon reporting.
The use of data is also enabling companies to improve transparency. Ripples from the 2013 collapse of the Bangladesh Rana Plaza building are still being felt across the world. More than 1,100 people died in what was the deadliest garment-factory accident in history – and consumer attitudes towards supply chain issues, such as working conditions and forced labour, have never been the same. As with food that ends up on our plates, more and more people are interested in where their clothes and other consumer goods are coming from – and they want companies to be more transparent in giving up that information.
Companies are realising that having a full picture of their supply base, backed up by data that points to potential risk, will stand up to this increased scrutiny by consumers and the media – and help to protect valuable corporate reputation.
The practice of corporate sustainability and the use of advanced analytics have not always been perfect bedfellows. In the past, corporate responsibility professionals have been far happier to operate in the creative world of communicating via PowerPoint, than burying their heads in Excel documents and big, complex data.
But the landscape is changing. Complex environmental and social challenges are getting bigger all the time, particularly in wieldy supply chains which often contain companies located in parts of the world most at risk from issues such as climate change and water scarcity. As data management software gets more and more sophisticated, aiding performance management and strategic decision-making, rather than just pure reporting, knowledge is giving companies the power to effect positive change along the value chain.
It is time for today’s sustainability professionals to embrace big data, not run away from it.
This article appeared in the Corporate Citizenship Briefing here and is republished with permission.
Negotiations at COP21 in Paris will put an important emphasis on enabling technology transfer between the developed and the developing economies. This will help those countries to leapfrog into a low carbon energy system, avoiding unnecessary lock-in to energy intensive infrastructure. Climate finance to support the deployment of low carbon technologies will also be high on the agenda. However, in addition to technology and financing, agreeing wider collaboration between countries will be crucial to ensure know-how and expertise is shared to accelerate results, avoid mistakes and reduce the overall cost of mitigation.
The projected impacts and costs of climate change make a clear and compelling case for the development of a low carbon, sustainable energy system. Energy demand is set to rise with the increase of the world’s population, coupled with the rise of the middle class in emerging markets means that there is now an urgent need for substantially more investment to be made into delivering large scale energy efficiency programmes around the world. This presents a great opportunity to draw on international best practise from countries which have already made huge advances in understanding the challenges and opportunities for energy efficiency.
Over the last decade the UK Government has backed a range of schemes to encourage organisations to become energy efficient. This has created a successful blueprint on how to address many of the barriers that exist for businesses; how to make the business case for action, how to identify opportunities, how best to invest in new technology, and how to encourage behaviour change. We are now seeing elements of this best practice blueprint being deployed internationally building on the experience from the UK and other countries.
South Africa has, by some distance, Africa’s highest national emissions and if oil-producing nations are excluded, South Africa is the world’s most carbon-intensive developing economy. The economy has grown more rapidly than the infrastructure required to meet its electricity demand, meaning that since 2008 the country has been suffering from serious energy shortages and has experienced regular load shedding. As a result of these factors, improving private sector energy efficiency has been a priority for South Africa as it can reduce overall energy demand and carbon emissions, at the same time as providing economic development benefits through improved business resilience, increased efficiency and lower operating costs.
The Carbon Trust has been an integral part in the setting up and delivery of South Africa’s first nationwide energy efficiency programme, the Private Sector Energy Efficiency Programme. Supported by the UK government, the programme provides funded support to private businesses of all sizes to help them understand the value of energy efficiency, and identify specific opportunities within their businesses. To date the programme has worked with over 2000 small businesses, 550 medium sized businesses and 35 large businesses, and in the process has identified over 7,500 GWh of lifetime energy savings, which represents c.5.5 MtCO2e in carbon dioxide savings. To date implementation of these opportunities has been running at 10% of these identified savings, but the programme is hopeful of increasing this by securing continuation funding to provide additional services such as concessional funding for energy efficiency.
Energy efficiency is sometimes seen as the Cinderella of the sustainable energy system, as focus is often directed towards energy generation technologies. To meet the challenge of climate change at the lowest cost, energy efficiency will need to improve by several orders of magnitude all around the world. Collaboration between governments to drive energy efficiency will be critical to drive success and to build a sustainable low carbon economy globally.
By Michael Rea, chief operating officer at the Carbon Trust
The Carbon Trust is a partner of the B4E Climate Summit 2015, which will take place on 9 – 10 September 2015 in London. Please visit the Summit website here to view the agenda and registration details.
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