UK BUSINESSES waste up to £1.6 billion annually and undervalue the financial returns gained from investing in energy efficiency leading to reduced energy costs.
A report released yesterday by Carbon Trust Advisory, the business arm of the UK government sponsored Carbon Trust, revealed the findings of their study of over 1,000 company’s energy efficiency investments over three years and a survey of finance directors.
The report found that finance directors typically estimate the average rate of return from energy efficiency projects to be less than 20 per cent, when in fact it is closer to 48 per cent.
This is four times the minimum level required by senior finance officers, with the average three year payback on energy efficiency measures also meeting the needs of eight out of ten finance directors, the report revealed.
A large UK firm could save an average 15 percent on its annual energy bill just through lighting and heating upgrades and staff training, said the report.
Hugh Jones, managing director of Carbon Trust Advisory said, "The business case for energy efficiency is clear and compelling. Few other investments get anywhere near that rate of return.
"Yet our data suggests big businesses are leaving around half the investment opportunities on the table and continuing to waste billions of pounds on unnecessary energy use every year."
Energy efficiency is still regarded as a low priority in many organisations, despite the much publicised and proven potential to boost a company's profitability.
To further drive business towards energy efficiency The Guardian spoke to Sandra Rapacioli, research and development specialist at the UK’s Chartered Institute of Management Accountants (CIMA), who told the newspaper that financial departments should play a bigger role in promoting and implementing green targets.
"Organisations around the world must wake up to the fact that sustainable business makes good business sense and that accountants are critical when it comes to driving such projects forwards," she said.
"With their considerable skill-sets, accountants are able to apply the necessary financial and commercial rigour to develop clear and measurable carbon reduction goals, facilitate effective implementation and provide credible business reporting."
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