UK: A POSITIVE TURN OFF - Business fuel bills are about to rise by 15% as the Government prepares to ...

UK: A POSITIVE TURN OFF - Business fuel bills are about to rise by 15% as the Government prepares to ... - A POSITIVE TURN OFF - Business fuel bills are about to rise by 15% as the Government prepares to introduce a climate change levy. Yet a Management

by ALEX GARRETT [PP] 89, 093.
Last Updated: 31 Aug 2010

A POSITIVE TURN OFF - Business fuel bills are about to rise by 15% as the Government prepares to introduce a climate change levy. Yet a Management Today/Brecsu survey reveals a lack of focus on reducing energy consumption at work. It's time to get serious, suggests Alex Garrett.

One priority in any Utopian vision of the workplace of the next century will be to minimise energy consumption. Information and voice traffic will dart silently around the world, registering barely a blink on the electricity meter. People will live close to the place where they work, perhaps an ecologically designed telecottage powered by solar panels or a wind turbine. The great office towers of the 20th century will have long since been dismantled. Meetings will be conducted via a thin plasma wall-screen. Old motorways will form the backbone of a national cycle grid, and airports will be historic theme parks.

Well, perhaps not next century. The fact is, the dawning of the information era has so far conspicuously failed to yield the reduction of energy use that many have envisaged. And it is unlikely to do so without a fundamental reorganisation of our economic system.

Technology has, if anything, become an excuse for huge corporations to install thousands of desktop PCs in buildings that are rewired accordingly and air-conditioned to create the correct temperature and humidity for all this expensive kit. As working hours become longer, offices have their lights on for an increasing number of hours each day, and the globalisation of business results in ever more airports and business flights.

We cannot go on as we are. The effect of global warming caused by the burning of fossil fuels means that the surface temperature of the earth is predicted to increase by between two and four degrees centigrade over the next 100 years, a rise similar to the one that brought our planet out of the last Ice age. That will mean drought for millions of people round the world, the extinction of animal and plant species, and a rise in sea levels that could put parts of the British coastline permanently under water.

Some people shrug at such doom-mongering, but for businesses the threat to the world's environment is about to become a serious expense. In April 2001, as part of an attempt to reduce Britain's greenhouse gas emissions to below 1990 levels, the Government proposes to introduce a climate change levy - a tax on coal, gas and electricity that will add 15% to business energy bills. And, over the next century, governments will tighten the ratchet of taxation on energy use. So if you haven't been bothered about wasting energy until now, you'd better start thinking about it.

In any organisation, steps can be taken to reduce energy consumption at the strategic level, affecting buildings and operations; and at the individual level - every person can make a small difference and help raise awareness among colleagues.

Management Today commissioned Mori On-Line to conduct a survey, in which more than 200 executives were asked about their attitudes and actions in saving energy. The results were illuminating. More than 50% of respondents said their company had set a specific target to reduce energy use where they work - but half of that number had no idea what the target was. And there was a notable level of ignorance about the amount of energy that is wasted by neglecting simple tasks such as switching off equipment.

A photocopier left on all night wastes enough energy to make 5,000 copies; fewer than one in 10 picked the correct answer, and eight out of 10 underestimated.

Did you know that lighting an average-sized office overnight uses enough energy to heat water for 500 cups of coffee? This time, only 24% chose the right answer.

Quantifying the amount of energy wasted in the workplace is an approximate science. The UK's total energy bill is a chunky £54 billion a year, of which 31% is accounted for by buildings. Some 29% of that cost is accounted for by service-sector buildings such as offices, which gives an annual figure of £4.85 billion. Service-sector buildings take about 225 billion kilowatt hours, or 12.5% of the UK's total energy consumption.

According to Mike Brookes, head of the energy management section at BRECSU, the government energy efficiency agency, the UK wastes 20% of the energy it consumes. That means about £1 billion of energy is being squandered from offices and similar buildings each year - £1 billion that could be diverted to salaries, profits or re-investment.

'How many times have you driven home late at night and seen an office block with all its lights on?' asks Brookes. The main causes of wasted energy in offices are lighting left on at night or during daylight, equipment left on when it is not in use, and inefficient heating systems. 'Many heating systems are set up with a time clock, but it is either not adjusted properly or it is being overriden.'

Another source of wasted energy is the increasingly widespread use of air conditioning. 'It's a bit of a fashion to install air conditioning in new buildings, but people should ask themselves if they need it in our climate,' he says. 'Air conditioning is very expensive because it is driven by electricity. It usually costs far more than heating a building, because that is often powered by gas.'

New buildings are otherwise much more energy-efficient than their older counterparts, he says, because of better insulation and state-of-the-art heating. However, because of the rush to get people into occupation, the services may never be commissioned according to procedure, which can leave heating and air-conditioning systems that are incorrectly adjusted from the outset.

At a management level, the first step that an organisation usually takes to improve its energy efficiency is to assess how much energy it should be using based on the buildings it occupies, the number of employees and the equipment in use. The next step is to implement a system for monitoring use. Then a target is set for reducing consumption; figures of 10% to 20% are realistic.

For most companies, the motive is the financial incentive or a concern about the environment and a desire to improve the company's reputation as a good corporate citizen. The two need not be mutually exclusive. LTE Scientific, a Manchester manufacturer of lab equipment, recently installed a lighting system controlled by sensors in order to make use of the increased natural daylight provided by a new factory roof. 'We estimate that it will save us 25% to 30% on our lighting bill over the course of a year, which was the main motivation,' says production manager Robert Holian.

'But if that also helps with the environment, then that's great.'

Seb Beloe, a consultant with Sustainability, the environmental consultancy, offers what he believes is a more compelling reason for taking action: 'If you look at the way that environmental legislation is changing, there is a trend towards more stringent and diverse regulations, particularly an increasing reliance on economic instruments.'

In other words, the climate change levy is just the tip of a looming iceberg for business. Nevertheless, Beloe believes energy efficiency cannot be divorced from a broader assessment of the organisation's environmental impact. 'It's an end-of-pipe solution,' he says. 'Energy is only one part of the waste that flows through an organisation.

You need to look at resource management as a whole. If you take a strategic view, you might, for example, decide to develop products and services that are more energy efficient.'

One of the biggest challenges will be to raise awareness of energy efficiency as an issue within the organisation. Our survey shows that most people have scope to control their working environment by adjusting window blinds, heating levels, windows and lights. But although more than 70% say they switch off lights or equipment 'often or always' when not being used, more than half say they 'seldom or never' adjust heating.

More than 70% also say they recycle paper and glass at home, while smaller sections recycle organic material (35%), plastics (26%) and tins (6%).

It is tempting to conclude that the 18% who say they recycle nothing at home are the ones who say they never switch off lights or equipment.

John Cole, environmental policy manager at HM Customs and Excise, says: 'I read that there are 20% of people in any organisation who are very green and do lots of things in their own home, and you don't have to worry about encouraging them. Then there is a bottom 20% who probably drop litter on the pavement - and you'll never get to them. The majority in the middle will take action some of the time, and they are the ones you need to get to.'

When it comes to switching on staff to the virtues of switching off, many organisations launch an awareness campaign. For a company like BT, with 165,000 employees, that is a challenge. In 1992, it set a target of reducing energy consumption by 15% in five years, and it recognised that a significant part of that saving would come from good-housekeeping measures that cost little to implement.

Because of the scale of the organisation, BT was able to spend almost £100,000 on its awareness campaign, which included a video, newsletters, magazines and briefing packs for managers. The campaign helped achieve an actual saving of 14% over the five-year period; BT has now set a new target of saving a further 11% from its 1992 consumption by 2002.

Other ideas to boost awareness include putting on an internal exhibition about energy saving; circulating messages via e-mail; or, like Digital Equipment, distributing a screensaver with a message to switch off. The thing about awareness campaigns, says Brookes, is to keep driving home the message. 'You have to keep drip-feeding it, so you need to plan over a year or two years. If you just have a quick burst for a fortnight, people tend to forget.'

Brookes also stresses the importance of establishing responsibility for energy efficiency at every level. There should be a champion on the board; in a large concern there may be a full-time energy manager. But responsibility should be devolved down. Some organisations appoint energy wardens to ensure that lights and equipment are not left on and that heating is not wasted in their sections. Some offer a reward to be shared among employees - an office party or a donation to a charity nominated by staff.

For many organisations, the danger is that the best efforts of their people to save energy will be undermined by the increasing energy needs of the business, and there is a further risk that the trend towards growing automation of buildings removes the opportunity for individuals to make a difference.

Customs and Excise has experienced both problems. It ran its own campaign, achieving energy savings of 14% within four years. But admits Cole: 'We've fallen back a bit. We're currently running at a saving of around 10% or 11% against the base year of 1990-91.' The setback has much to do with the agency's decision to slim down its estate from over 500 buildings to 300. 'We thought that by having flexible, open-plan offices it would bring our use down, but what has happened is that, at the same time, we have been installing far more IT and many of our new swishy buildings have air conditioning.'

Now the agency will not take on buildings with air conditioning if it has a choice. And it has started to put switches back. In the enlightened organisation, managing energy efficiently in the future will be about introducing reliable systems at management level and harnessing staff goodwill. Companies that take action will look smart and save money. Those that don't will face increasingly crippling bills.

On-Line interviewed a random sample of senior executives drawn from the Management Today database. Fieldwork was conducted between 28 August and 8 September 1999. All results reported are accurate to +/-7%


1 Before opening windows, check the heating isn't on. If it is, get it turned down. In an air-conditioned office, blinds can keep out the sun and reduce the amount of cooling needed.

2 If you're leaving your office for more than 10 minutes, switch off the lights and equipment. Switch off computers at the end of the day.

The last person to leave should switch off all shared equipment.

3 Check time controls on heating systems, especially after clocks go back in autumn/ forward in spring. Check thermostats often.

4 Ensure your air conditioning is never on at the same time as heating - a cardinal sin.

5 Replace tungsten bulbs with energy-efficient 'compact' fluorescent lamps.

6 Switch lights off during good daylight. Consider investing in a control system. 'Occupation sensor' systems switch off the lights in a zone when no movement is detected over a period of time; other systems switch off lights at pre-set times or when natural light is strong enough.

7 Keep fluorescent lamps clean and in good order. Flickering/dirty lamps waste energy.

8 Make sure doors and windows are properly closed at the end of the working day to prevent heat loss and maintain security.

9 Ensure the building services manager knows about any unoccupied rooms or offices so that heating can be turned off.

10 Ask suppliers to specify energy efficiency of equipment before buying or leasing.


For organisations of more than 250 people, the Government - via BRECSU - provides free on-site advice, including where energy is being wasted and how to put it right. A consultant will visit and draw up an action plan. There is a separate scheme for advice on designing new buildings to be energy efficient. Call the Environment and Energy Helpline on 0800 585 794.

For organisations of fewer than 250 people, the Energy Saving Trust offers rebates of 50% to a maximum £3,000 on installation of lighting control systems. The scheme is called Lightswitch. Call 0990 133 538.

Grants are available to convert fleet cars to clean fuels such as liquefied petroleum gas, natural gas or electricity, under the Government's Powershift programme. Call the Energy Saving Trust on 0345 277 200.

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