Sustainability has become much more than just a buzzword for business. Increasingly, environmentally conscious consumers are driving retailers to demonstrate their green credentials on the shelves and in their business models. Simultaneously, shareholder pressure is pushing the issue to the very top of corporate agendas where environmental, social and governance (ESG) is no longer a mere afterthought tucked in at the back of the annual report.
Nowhere is this more manifest than in energy usage where companies have a twin focus on reduction and a switch to renewable sources. For example, earlier this year, Amazon announced a deal to purchase all the energy produced by a new wind farm to be built Invis Energy in Meenbog, Co Donegal. The wind farm will generate 91.2 Megawatts of power when it goes into operation in 2021.
The power will supply the Amazon Web Services (AWS) data centres in Ireland and will assist the company in reaching its goal of having all its global energy needs met by renewables. The latest reports indicate that it is already more than halfway to achieving that objective.
And this isn’t the preserve of global giants. Irish food company ABP entered into an arrangement with international sustainable solutions provider Natural Capital Partners to match the electricity consumption of its eight Irish production sites with wind power.
This will enable ABP to power all of its facilities on the island of Ireland exclusively from wind energy and is helping it achieve its ambitious 2020 carbon reduction goals almost two years ahead of schedule with a cumulative CO2 emission reduction of 350,000 tonnes since 2008. According to the company this arrangement coupled with energy savings initiatives will allow customers to source meat produced with a lower carbon footprint - a significant marketing benefit these days.
Cash for Kilowatts
Energy producers are also playing their part. "We provide a comprehensive range of services designed to enhance energy efficiency, save on cost and minimise the environmental impact of our customers," says Energia Retail managing director Gary Ryan. "Our experts work directly with business clients across Ireland to undertake audits of their operations to identify energy saving opportunities and work with them to integrate sustainable solutions that meet their needs. Our 'Cash for Kilowatts' and recently introduced 'Upgrade and Save' schemes are designed for business customers and we also hold energy awareness workshops and demonstrations on site at client businesses to illustrate how their employees can save at home."
To date, Energia has provided businesses with over €9 million in grant funding and supported the saving of over 400GWh of energy.
The Cash for Kilowatts scheme helps businesses to identify and implement energy saving measures. “We work with clients on solutions involving lighting, compressors, refrigeration and pumps to name but a few, and we also provide project management services as part of the overall process”, says Ryan. “Once the savings have been verified, we pay the project partner a grant based on the annual kWh savings, typically up to 30 per cent of the overall capital cost. It is an extremely successful scheme and we have worked with businesses all over Ireland to further their sustainability agendas.”
Upgrade and Save is Energia’s newest energy efficiency scheme and sees the company project manage the upgrade of a business’s lighting to LED, potentially reducing lighting energy usage by up to 80 per cent. “Our experts guide clients through the entire process, providing them with a bespoke lighting solution to fit their needs, procuring and installing the new LEDs as well as removing the old lights and ensuring they are recycled,” Ryan explains. “There is no up-front capital or on-going maintenance cost to the customer over the lifetime of their contract, and they also get to keep 100 per cent of the kWh savings at the end of the contract term.”
Lighting as a service
This lighting as a service (LAAS) model is growing strongly in popularity. Former Irish Times Innovation Awards finalist UrbanVolt replaces lights in commercial buildings with LED substitutes with no upfront costs to the client, and then it maintains them for up to 10 years. The company generates income by charging clients a percentage of the savings on their lower energy bills as a service fee for the first five years of the contract.
In an indication of the growth potential of this area, UrbanVolt secured €55 million in debt financing last year from UK renewable energy investment firm Low Carbon. This was in addition to the €30 million funding agreement it had arranged with Swiss private equity firm Susi Partners two years earlier.
Swedish furniture and home products giant Ikea is another company with a strong commitment to sustainability.
"Sustainability has been in Ikea's DNA since day one", says Ali Sheridan, sustainability manager with Ikea in Dublin. "Last year we ramped it up further and we want to transform the company over the next decade. We are looking at three core areas - healthy and sustainable living; circular and climate positive; and fair and equal. We want to help and inspire our customers to make sustainable choices. We organise workshops for co-workers and customers to explore areas like water and energy saving. We hope to inspire one billion people by 2030 to make small changes at home."
The circular and climate positive area is focused on the company itself. “We intend to be a fully circular business by 2030,” says Sheridan. “We are looking at our own operations and supply chain. We want to produce more renewable energy than we use, and we have achieved that in Ireland through our wind farm in Co Leitrim. We will be 10 years in Ballymun this summer and 100 per cent of the lighting in the store is now LED. We also have an onsite biomass boiler for hot water and space heating. By 2030 all our products will be recyclable or reusable and by 2025 they will be delivered by electric vehicle.”
And for businesses not in a position to invest in their own renewables generation plant, Energia continues to expand its portfolio. “We are currently in the process of completing a new €50 million bioenergy plant at Huntstown in north County Dublin which will use anaerobic digestion to convert organic waste such as food waste, into methane rich biogas which will then be used to generate renewable electricity,” says Ryan. “It will begin full operation by the end of 2019 and will generate 4.8 Megawatts of electricity per hour.”
