Like most things these days, sustainability has turned into a real alphabet soup, with acronyms, organizations, standards and protocols. This article seeks to sort out the various organizations and initiatives that are related to sustainability, and it defines the role of energy efficiency in this process.
A key outcome of any actions around sustainability in business today lies in the communication with customers and stakeholders. Timberland shoes provides an innovative example of this communication about the company's efforts related to the environment and use of resources. Every box of Timberland shoes has a label that resembles the “Nutrition Facts” label found on food and beverage products. Called “Our Footprint,” this label gives consumers detailed information on the environmental and community impact of the product (see a larger version of the label here). In general terms, items such as manufacturing factory locations, climate impact, chemical uses and resource consumption are all tracked, calculated and provided to help consumers make informed decisions with greater product transparency.
In addition to communication directly with consumers, sustainability reports are directed at investors and shareholders. For investors, companies want to shed light on steps they are taking to reduce the long-term risk that happens when carbon-based fuel is required to produce a product or service. These reports often deal with “specific consumption,” which is the amount of fuel required to produce a unit of output. Examples of specific consumption include airlines (gallons of jet fuel per passenger mile), cookie and cracker producers (BTU of energy per lb of production) and commercial real estate owners (kWh of electricity per square foot). It is generally accepted by the financial community that the cost of fossil fuel will rise faster than inflation, so investors are looking favorably at industries that are reducing the amount of volatile and costly electricity and direct fuel that go into their products.
Saving energy costs brings a double benefit to the discussion around sustainability. The first benefit is that savings themselves flow directly to the bottom line to increase profitability. The second benefit is that reducing carbon-based fuel input also reduces long-term risk associated with consumption of carbon-based fuels. Although any initiatives under sustainability are often seen by corporations as a cost of doing business or good for public relations, efficiency projects also include an attractive return on investment, and therefore directly improve the bottom line.
Definitions Around Sustainability
- CSO: Corporate Sustainability Officer
- CSR: Corporate Sustainability Reporting
- ESG Reporting: Any report or series of reports that deals with corporate Environmental, Social and Governance
- GRI Index: The Global Reporting Initiative established the leading protocol for sustainability reporting, including energy inputs.
- Plant EPI: Energy Performance Indicators have been developed by Energy Star for certain industries including cookies and cracker production, corn refining, frozen fried potato processing and juice processing plants. These are benchmarking tools to allow a plant to gauge its operations against others in the industry.
- Specific Consumption, also called Energy Intensity: The amount of energy required to produce a certain quantity of a product or service
- Sustainability Dashboard: Software tool that collects and reports key data around sustainability such as fuel and water consumption, solid and liquid waste, chemical inventory, land use and other factors.