Is Your Business Prepared for the Evolving Energy Market?
Market evolution is driving change in how companies strategically manage their energy. This changing landscape opens opportunities for businesses to modify their energy consumption mix, with potential cost savings as a result. Increases in data-driven technology also help companies better understand their real-time, interval energy consumption and demand, which can provide the visibility required to curtail usage when prices spike or better negotiate contracts according to individual site consumption and demand patterns.
Strategic energy management can result in significant cost savings. But respondents to our recent corporate energy and sustainability research report indicate strategic sourcing as a top savings opportunity only 29% of the time. This is unfortunate, as businesses with strategic sourcing initiatives are also more likely to explore innovative technologies and invest in other complementary technologies such as combined heat and power, battery storage and renewables.
There’s also increasing complexity in energy sourcing as markets begin to diversify their generation mix. Renewable technologies are now some of the most affordable electricity sources in the world and the result is higher renewable penetration than ever before.
Change is afoot: how the market is evolving
Market evolution introduces new considerations for companies to weigh as part of their overall procurement strategy. No longer is renewable energy an add-on for only the most progressive and environmentally-minded organizations. Rather, renewables have become a smart business strategy for companies of all sizes and sectors.
Some evidence of the changes being driven by market evolution:
Renewables are becoming central to business. Corporate investment in renewable energy continues at a rapid pace; 2018 was a record-breaking year with 13.4 GW of renewable energy contracts executed by corporations, and 2019 is predicted to follow this path. More than 150 corporations have committed to 100% renewable energy, with additional commitments coming from the public sector by cities, schools and other organizations.