Posted on: 09/11/2015
As a growing number of big brands switch to renewable energy, SmartestEnergy’s Mike Shirley looks at the driving forces behind a trend which has led the company to launch a major initiative.
Recent weeks have seen a clutch of major brand names make high profile commitments to power their businesses using 100% renewable energy.
Goldman Sachs, Johnson & Johnson, Nike, Procter & Gamble, Salesforce, Starbucks, and Walmart became the latest global giants to join RE100, an initiative which is looking to help encourage the world’s biggest companies to switch to renewables.
In the UK, the likes of BT Group, John Lewis Partnership, Land Securities, and Marks & Spencer have also made public pledges on sourcing their energy from renewables.
It’s clearly a trend which is gathering pace, but why are so many blue-chip businesses looking to make the switch?
With consumers increasingly interested in the environmental impact of their buying choices, reputational issues are clearly an important factor for many.
Buying renewable energy is now a key part of wider CSR and sustainability commitments. Major corporations and public sector organisations are also looking at the sustainability of their supply chains when considering who to do business with.
Role of carbon footprinting in cutting emissions
Many larger businesses are also increasingly looking to accurately calculate their carbon footprint, a step which is seen as a key foundation for businesses to be able to make long-term reductions in greenhouse gas emissions.
Through measuring and reporting emissions, targets can be put in place and the success of reduction initiatives can be tracked.
Energy often makes up a significant proportion of the carbon footprint of a business and at a time of increasing costs and volatility, seeing exactly where exposure to price spikes and risk lies is important.
Calculating carbon footprint is also part of the mandatory reporting regulations many larger companies face.
Greater accounting transparency
Latest guidance for the most widely used greenhouse gas emissions accounting tool – the GHG Protocol Corporate Standard – has brought greater transparency to energy purchased by businesses.
The Scope 2 guidance aims to help companies to take a more holistic view of their carbon reduction strategy by being able to account for reductions from procurement choices as well as energy efficiency measures.
The growth in demand for renewable energy we were seeing at SmartestEnergy, coupled with the evolving opportunities around carbon footprinting, prompted us to look at developing a simple offering to help businesses achieve and demonstrate their sustainability ambitions as well as meet carbon reporting requirements.
Independent verification by Carbon Trust – the first renewable electricity supply product to be able to offer that – underpins confidence in the credentials of the energy supplied. An annual energy label also visibly highlights where a customer’s electricity has come from and also enables easy comparison with other suppliers.
The product has sparked significant interest in the market and in my next article I’ll look in more detail at exactly why we developed it and the Carbon Trust’s involvement.