Displaying items by tag: Energy Management

Cable and telecom operators have streamlined their operations and engineering organizations but the environment is still one of complex change. An external advisor can bring in the targeted resources to minimize operational impact and temporarily expand engineering resources to complete mission critical projects and tasks with no long-term impact on Opex...

Much of the general research about goal setting directs us to believe that reaching for the stars produces the best results (see Locke & Latham, 2002, 2006). Our sustainability consulting team at Coppervale Inc. embraces that perspective.

But there’s a catch. Goal setting ought not to be taken lightly. For example, when we consult with clients about setting GHG reduction targets, we use multiple data points, not least of which is one related to the organizations capacity for change. For other sustainability initiatives, we even advise that goal setting may even erode progress. 

If you remember from the previous blog, our fictional, recently hired Sustainability Manager was in the process of making a recommendation to the CFO regarding a GHG reduction goal for the organization. Right before leaving the office she remembered an article that she’d read in graduate school titled “Goals Gone Wild: The Systematic Side Effects of Over-Prescribing Goal Setting”. 

To cue up the salient points from the article, here are a few questions that we ask our clients in preparation for setting sustainability goals: 

•What is the history of goal setting at your organization? 

•Are there any instances where goals caused problems, ethical or otherwise? 

•Is your organization overwhelmed and fatigued by too many goals?  

•How do you think a goal will change the way your company thinks, acts and performs in the future?

•How do you plan to manage goal execution?  

In addition to the questions above, we are inspired by the research compiled by Lisa D. Ordonez and others about the challenges that goals can create. Here is a top five list of things to consider when setting goals, all drawn from Ordonez’s “Goals Gone Wild” article referenced above: 

1.Specificity

When goals are too specific it is possible to overlook unintended but foreseeable consequences. 

2.Narrowness

Myopic targets make it tough to consider what’s being excluded.

3.Frequency 

When there is a litany of goals we still tend to focus on just one goal. Further, evidence shows that we pursue the goals that are more straightforward to “prove” using quantitative data and shirk goals that are difficult to prove. 

4.Inappropriate Time Horizon

If the deadline is too quick it’s possible to influence short-term behavior by sacrificing long-term institutional change. 

5.Difficulty 

When goals are too difficult, expect risk profiles to loosen, unethical behavior to increase and the likelihood of managing the psychological issues related to a missed goal to surge. 

How should our Sustainability Manager integrate this information into her GHG reduction target recommendation? At the very least it ought to suggest a cautionary and thoughtful approach to choosing the right target for her company. In addition, since she’s new, it might be worth her time to learn more about the history of goal setting within the organization.

The final blog post in this series will focus on GHG reduction targets associated with the cable and telecom industry. This should provide confidence to our character as she approaches her meeting with the CFO.

This is the first of three blogs regarding setting Green House Gas (GHG) reduction targets.  It begins with a common situation.

It’s your first week as the newly minted Sustainability Manager for a fast growing mid-size company and the CFO sends you a one-liner via email - “GHG reduction target – recommendation?...need soon” You’re smart and senior enough to instantly recognize that this is a fairly complex topic that includes a bit of art but also a strong dose of science.  Given that, you work to buy yourself a couple of days before you respond so that you can brush up on the recent literature. 

The first lesson you note is the difference between an absolute target and one based on operational intensity like revenue or units sold. While the difference is basic you sense that the implications are immense regarding the way your company would go about meeting either objective. 

You like the simplicity the absolute target provides but you’re immediately wary of how your company might meet an absolute reduction given the growth goals you’re privy to. Oppositely, you like the ability of the intensity metric to scale with that growth. Additionally, you appreciate the industry comparability an intensity target provides. But what happens if the nearest competitors choose a different intensity metric? 

Hmmm…Since you’re at a standstill you table the choice regarding absolute or intensity target setting and continue toward other important, interrelated components of setting a target. 

Probably the most obvious component of the equation is what reduction target to choose. Should you choose 5%? What about 10%? Will numbers that small make a difference? Headlines? Perhaps we should go big and see what’s possible. Why not 50%?  Well, it’s more complicated than that. The answer depends on at least two additional inputs. 

Another important component is how long your plan extends. In other words, what’s the deadline? Again, you could choose a short time frame, say 3 years or a deadline 50 years out. It’s up to you.

At this point, you’re beginning to wonder if you might need GHG experts for support in making this recommendation. You can see business disciplines making justifications in opposite directions and it’s not hard to envision conflict and confusion as this process works its way through the company and externally to your stakeholders. 

Without a doubt, this decision carries many implications. 

To make some sense of the broader situation you put together a table of the top 10 performers from the Newsweek 2012 Green Rankings. You make a note of whether an absolute or intensity metric is used, what the reduction target was and the amount of time the companies allotted to meet the target. Your preliminary research returns the following information:

While the average, min and max of the first two columns are interesting you’re thoughts are directed toward the final, normalized column. In particular, you notice the small variance between the first seven companies (prior to Accenture’s big jump) which works out to a GHG reduction average of 2.1%/year. 

Feeling good about your ability to tease this data point out, but with even more questions than answers, you decide to call it a day and begin to sign out of your computer. Checking your email one last time you see an article from your MBA alma mater that reads: “Goals Gone Wild: The Systematic Side Effects of Over-Prescribing Goal Setting”

and wonder if the article could influence your reduction recommendation. You bookmark it, close your browser and head home. 

Be sure to read “Finer Points of Greenhouse Gas Goal Setting” in blog two of three to see what our character learns.

This year the United Nations Conference on Sustainable Development (Rio+20) met in Rio, Brazil.  At the conference, the UN Secretary-General Ban Ki-moon highlighted a global initiative launched late 2011 that focused on achieving Sustainable Energy for All.  The initiative calls on private sector and national participation to meet three energy objectives by 2030 - energy access, energy efficiency and a focus on renewables.  In the wake of this conference, a new report has been released by the United Nations Global Compact and Accenture, titled “Sustainable Energy for All: The Business Opportunity.”  

The report, while focused globally, highlights industry specific opportunities and trends.  It reports that of industry CEO’s surveyed, 91% will employ energy efficiency measures to address sustainability issues over the next five years.  This correlates broadly with consumer perceptions which also indicate a growing trend in renewable awareness and efficiency, with 79% of consumers worldwide reporting a more positive perception of brands produced with wind energy, and 50% of consumers worldwide willing to pay extra for products based on renewable energy.  

While the report offers broad recommendations, it also focuses on 19 subsectors and advises on the impacts renewable energy can have on the bottom line.  It suggest that renewable energy can acts as a hedge against volatile energy costs, while also offering a potential regulatory hedge against carbon restrictions imposed by governmental actors.   An executive summary focusing specifically on the Information and Communications sector was published and provides insights on actions the sector can take to become more energy efficient and advance business opportunities. A few of these include recommendations on the improved energy efficiency of operations, as well as the development of services to improve the energy efficiency of travel and logistics.

In spite of the reports lack of specifics on precisely how to implement efficiency recommendations for advancing business opportunities, a variety of tools presently exist to identify key areas for development.  A first step in the process is to identify present energy usage in the form of a carbon audit.  Viewing energy usage through the lens of a carbon audit allows for companies to assess their energy usage, while simultaneously addressing their carbon footprint.  

A carbon audit provides baseline data to assess current energy consumption, offers insights into areas of potential energy and financial savings, and allows for the creation of baseline energy/carbon reduction targets. Armed with the potential for energy and financial savings, companies can leverage their corporate sustainability efforts with positive communications to consumers and improved brand imaging.  The combination of these often results in an improved bottom line.

For those on either side of the political debate on climate change, the economics of reducing emissions is beginning to make good financial sense. Market realities, high fuel costs, and decreasing costs of alternative fuel vehicles, are all contributing to an environment where by conversion to alternative fuel vehicles (AFV) is becoming increasingly attractive. Add to the mix U.S. tax credits up to $7,500 per vehicle, and the numbers start to add up.

SunRidge Farms, a snack food maker in Royal Oaks California recently told Jennifer Wang of Entrepenuer.com, “We save 33 percent on fuel costs off the hybrids alone.” SunRidge began conversion to an alternative fuel fleet in 2004, as part of an overall sustainability strategy. Conversion to AFV typically reduces fuel consumption, which immediately reduces fuel costs. In addition to this, switching to alternative fuels such as electric or compressed natural gas (CNG) also reduces carbon emissions.

While the conversion to alternative-fuel vehicles may not suit every scenario, the increase in AFV sales is undeniable. U.S. sales in August nearly doubled, as automakers across the board are developing AFV technologies to compete with the ubiquitous Toyota Prius.

Chart Credit: Clean Cities Alternative Fuel Price Reports

Despite overall gains in sustainability, perceptions of sustainability performance are not keeping track, a new report finds.  The report published by brandlogic and CRD Analytics assessed overall sustainability of 100 of the leading corporations and surveyed perceived sustainability from 2500 respondents.  Corporations assessed account for 16% of gross world product. Respondents were drawn from purchasing/supply professionals, investment professionals, and graduating college/university students across six countries.   

The report suggests a failure to effectively communicate sustainability gains to target stakeholder groups who are increasingly skeptical and points to an increased need for effective communication of sustainability gains.

Full Report: www.sustainabilityleadershipreport.com

Image Credit: The Brandlogic Sustainability IQ Matrix(TM) categorizes global brands as Challengers, Leaders, Laggards or Promoters. (Graphic: Brandlogic)

In the late evening on December 18th, 2009, all eyes were on Copenhagen waiting to see if the Conference of the Parties 15 (COP15) of the United Nations Framework Convention on Climate Change (UNFCCC) would produce a global climate treaty that would require the nations of the world to reduce their output of greenhouse gas (GHG) emissions. The outcome of COP15 was expected to impact every aspect of society, and most prominently, the corporate world. At the end of a two week long negotiating session, Copenhagen produced a non-binding “agreement” void of any real emissions reduction targets or timetables to achieve them. The Copenhagen Accord was a decision made by the 193 nations participating in the Conference to “take note of” for further review in 2010. The Accord recognizes the following major action items:

• There is a scientific case for keeping global temperature rise to no more than 2°C.
• Developed Nations (Annex 1 Parties – the largest emitters) will determine economy-wide emissions reduction targets for 2020 by January 31, 2010. 
• Developing nations (Non-Annex 1 Parties) will determine methods to implement mitigation actions by January 31, 2010. 
• Developed nations will collectively generate USD $30 billion for the period 2010 through 2012 and USD $100 billion from 2012 to 2020 to assist developing nations in their climate change adaptation and mitigation activities.

Although legally-binding emissions reduction targets were not included in the Accord, most nations have proposed unofficial emissions reduction commitments which they claim they will implement through domestic policy. Most nations, like the United States and China, are steadfast in their position to achieve the following goals:

• USA proposed to cut GHG emissions to 17% below 2005 levels by 2020, pending congressional approval (this is equivalent to 4% below 1990 levels).
• China: Proposed to cut CO2 emissions per unit of GDP by 40-45% below 2005 levels by 2020.
• European Union proposed to cut GHG emissions by 20% from 1990 levels by 2020, or 30% if other big emitters take tough action as well.
• India proposed to cut CO2 emissions per unit of GDP by 20-25% from 2005 levels by 2020.

The current emissions targets on the table are expected to lead the world on a path toward a global temperature rise of 3°C. Stronger commitments are needed from the largest emitters, including the United States and China, to reach the goals set out in the Copenhagen Accord. As of January 29th, the United States appears to remain firm on its 17% target reduction in emissions by 2020 from 2005 levels. In a letter to U.N. Climate Officials, President Obama pledged to uphold our target emissions reduction goal set out at Copenhagen, and that more details were to follow pending Congress’ decision on the Climate Bill.

Despite this positive and ambitious first step, it is still uncertain as to when the “details” of the U.S. commitment will be worked out. As climate legislation sits idle in Congressional subcommittees, Corporate America waits with baited breath to follow through on Cleantech investments. In a recent press release, Alstom Power President Philippe Joubert said that “Uncertainty about the legal and regulatory framework around carbon dioxide emissions is holding back needed investments”. In a letter to President Obama, a group of 80 U.S. companies stated that “[Climate] legislation would spur a new energy economy and with it create 1.7 million new American jobs, many in struggling communities across the country” (Environmental Leader, 2010). In addition to the desire for a green light on Cleantech investment, corporations are pushing for Congressional movement on a more flexible and “business-friendly” Climate Bill for fear of being pinned under the strict and expensive regulatory thumb of the EPA.

No matter how the U.S. decides to regulate carbon dioxide emissions, the world will be holding us responsible for upholding the pledge President Obama made to the U.N. Climate Officials this week. U.N. Climate Chief Yvo de Boer said recently that "Whatever route is taken, the president of the United States committed to a 17 percent emissions reduction in Copenhagen. The president of the United States committed to more ambitious emissions reductions for 2030 and 2050. And it is those statements to which the international community will hold the government of the United States accountable” (Greenwire, 2010).

Without the support of congressional legislation, President Obama met the U.N.’s January 31st deadline by confirming to uphold the United States’ pledge at Copenhagen. The details surrounding the implementation of that emissions target and the accompanying timetable are yet to be determined. The waiting game for the creation of solid and defensible action to regulate carbon emissions at home and abroad continues…

Coppervale will ensure you are paying the appropriate rates for the utility power you use. Whether your operations are based in regulated or deregulated energy markets, we have the experience to reduce your rates...