Energy efficiency is a cost-effective solution to lower our energy use while simultaneously protecting the environment.
Countries that prioritize energy efficiency investments over more costly supply investments often see lower energy prices and keep costs under control. Energy efficiency programs have become widespread globally.
But not all families can access these benefits; many face high energy burdens that force them to choose between paying their bills and eating.
1. Reduced Energy Bills
Energy efficiency reduces our dependence on fossil fuels, thus decreasing our ecological footprint and helping mitigate climate change, reduce air pollution, and preserve natural resources.
Simple behaviors and small investments in energy efficient equipment can significantly lower energy costs. Some examples are installing a programmable thermostat, advanced power strips to eliminate vampire loads, and energy-saving lighting.
Energy efficiency reduces load by decreasing electricity use at one time (known as load), thus relieving strain on the grid and avoiding outages in areas without access to renewable sources of power. Businesses that prioritize energy efficiency may attract environmentally aware customers and employees while investing in it will enable your company to comply with future regulations and code requirements more easily – thus saving on penalties associated with noncompliance.
2. Reduced Greenhouse Gas Emissions
Energy efficiency helps limit greenhouse gas emissions and the impacts of climate change, while eliminating future fossil fuel extraction, processing and transport costs and making renewable energy technologies more cost effective.
Additionally, energy equity can be achieved by providing cost-effective and energy efficient technologies to families who bear greater energy burdens – the percentage of their income spent on electricity costs.
Energy efficient companies demonstrate their environmental and social stewardship and responsibility, which attract customers and can lead to greater shareholder value as customers are more likely to choose companies who share their priorities and values – something known as a signaling effect.
3. Increased Productivity
Energy efficiency improves indoor comfort, which improves productivity and decreases absenteeism. Furthermore, energy-efficient lighting, appliances, and equipment help save money on utility bills – saving more of which can be applied towards expanding company profit.
Energy-saving products increase a business’s competitive edge in the marketplace. Millennials place great importance on companies’ social responsibility and environmental activism, so they tend to support businesses that take energy efficiency seriously and purchase from these businesses more readily.
Energy efficiency programs can play an essential role in combatting global access crisis by reducing energy demand and improving reliability. USAID efficiency programs in developing nations, for instance, promote energy-saving behaviors while helping utilities shift electricity use to off-peak times in order to better manage peak demand and avoid outages – thus freeing capacity for new generation that allows sustainable growth with increased access for consumers.
4. Increased Profits
Energy usage by businesses has an immediate and significant effect on profits, and improving energy efficiency is a great way to balance demand with supply, cut costs and eliminate greenhouse gases emissions.
Energy efficiency can contribute to economic development and grid reliability by using less energy for providing services at the same level, thus decreasing outage risks.
But it is essential to consider the human element when creating an energy efficient strategy. Employee engagement and buy-in are vitally important in its successful implementation; otherwise they could opt not to make changes that they believe may be too costly.
5. Increased Shareholder Value
Energy efficiency reduces a business’s reliance on imported energy resources and increases security, helping mitigate geopolitical risks while decreasing blackouts or grid instability.
Customers and employees tend to favor companies known for being eco-friendly, seeing it as a competitive advantage and encouraging socially responsible business practices. This holds especially true among millennials who prioritize supporting businesses that embrace sustainable practices.
These additional benefits (commonly referred to as co-benefits, ancillary benefits or quantifiable non-energy system impacts) are often neglected when conducting energy efficiency evaluations and are estimated at between 40%-250% of the monetary value of energy savings per measure. Our financial tool can help quantify these non-energy benefits to demonstrate why investing in energy efficiency projects makes good business sense.