Energy Transition Culture – Why Green Innovation is no longer “green”

Long gone are the days when responding to environmental problems were a compromise between planet and profit for executives. In this new world, both business and the environment can win. At Zestec we have coined the phrase Energy Transition Culture, ergo, the will and drive to shift to a majority of renewable energy sources. Energy Transition Culture is no longer a cost of doing business; it is a mechanism for innovation, new market opportunity, and wealth creation. Here are 5 reasons why:

1. Strategic Orientation
2. Profitability
3. Leaner Supply Chains
4. Attracting Emerging Young Talent
5. Playing your part in Saving the Planet, Before it’s too late…

 

1. Strategic Orientation

Can you imagine your business operating in 2022 had it not embraced a digital cultural transformation in some way? With 622 of the 2,000 largest publicly traded companies in the world committing to a net-zero strategy, it is safe to say that to strive for a competitive advantage, one must decarbonise or die.

Becoming more sustainable may not be easy at first but integrating an Energy Transition Culture should now be viewed more as an opportunity than a threat. According to McKinsey, a strong ESG proposition through the integration of renewables adds value to corporations through top-line growth, cost reduction, regulatory interventions, productivity and asset optimisation. Embracing an Energy Transition Culture should be an integral part of any leader’s strategic checklist. It creates opportunities to attract customers and team members with more sustainable products, lower energy consumption costs for competitive pricing, earn government subsidies and to enhance investments by allocating capital for the long term. Ultimately this gives executives and managers concise investment choices to drive business growth.

 

2. Profitability

Not only is the creation of an Energy Transition Culture strategic, but it can also be profitable to businesses and stakeholders. Worldwide, record high energy bills are devouring profits in an already very challenging economic environment, with (SMEs) in the UK facing an average gas bill hike of more than 250% in the last year. Volatile wholesale pricing means finding a new contract as a business is even more difficult, a cost that will inevitably be passed on to your customers.

In parallel, renewable energy is now more accessible and affordable than ever. The cost of the technology itself has decreased and new financing vehicles have improved access and lowered capital requirements. Investment into renewable sources like solar power, wind and hydrogen are sure fire ways to reduce your overheads over time. For those businesses with more pressing strategic investments in mind, or those with limited in-house expertise on renewable technology, alternatives like Power Purchase Agreements (PPAs) are available for migration off the grid, financial savings and carbon reduction at zero capital outlay. In the past couple of years, we have seen early adopters of these agreements among blue chip organisations as they strive for their net zero targets.

3. Leaner Supply Chains

According to Deloitte, when treated as a strategic asset rather than a tactical expense, renewable energy provides cost and risk benefits across the supply chain. Renewable energy can be used throughout the supply chain to decrease long-term costs, mitigate risk, drive new revenue, enhance brand value and improve employee engagement. As technologies and regulations mature, companies should be re-evaluating their energy procurement strategy to take advantage of these benefits.

4. Attracting emerging Young Talent

Young professionals are primed to be a critical force for the energy transition, bringing new ideas and pursuing careers aimed at decarbonising the sector. A survey by GetMyFirstJob.co.uk, which interviewed 1000 recent graduates, found that a third (33%) said they think that climate change has affected how they will search for career opportunities. Of these people, more than two thirds (68%) said they would like to work for an employer that is doing something positive for the future of our planet. Providing a platform through your business for young professionals to drive change through more sustainable business practices, will unequivocally attract the best emerging talent to your organisation.

5. Playing your part in Saving the Planet, Before it’s too late…

Just 100 companies are responsible for 71% of global carbon emissions, the baton to stimulate transitions should not fall in the hands of energy planners and policymakers when our fastest emitters are corporations. Every company uses energy and resources; every company affects, and is affected by, the environment, including yours. Before any bottom-line or economic incentive comes the reality, as David Attenborough has said, that “the natural world is the greatest source of excitement; the greatest source of visual beauty; the greatest source of intellectual interest. It is the greatest source of so much in life that makes life worth living.” There is an urgent need and obligation to save our planet before it is too late, every and any company should play their part.

So there you have it, 5 reasons to embrace the Energy Transition Culture. By doing so you stand to improve your strategic outlook, profitability, supply chain and recruitment, oh, and in the meantime, you are doing the right thing by our planet. Green innovation is no longer green, on the contrary, it is already an established solution for many of the issues business leaders are faced with today. For businesses and leaders, it is simply a choice to either be passive or actively adopt this essential cultural shift.