Top 5 Business Energy Benchmarking Benefits

Today, businesses are under increasing pressure to reduce their carbon footprint while at the same time improving their bottom line. The two objectives often seem impossible to achieve at the same time, yet energy benchmarking has emerged as a powerful tool to make it possible. Analyzing energy consumption patterns and examining cost anomalies can help businesses make informed decisions that lead to significant savings. At the same time, energy benchmarking can also identify the fastest and most effective ways to contribute to corporate and stakeholder sustainability goals.

Top 5 Benchmarking Benefits

Saving – Energy and Money

Collecting valuable energy data begins with using information already available to businesses. Energy bills provide a wealth of information that, when complied into a single source and analyzed, can immediately reveal trouble spots and savings opportunities. Comparing energy performance against industry standards or similar facilities helps pinpoint areas of excessive energy consumption often caused by faulty equipment or waste. As such, businesses can identify inefficiencies and implement targeted strategies to reduce energy use. This leads to cost savings and enhances overall operational efficiency.

According to a recent report by energystar.gov…

Benchmarking informs organizations about how they use energy, where they use it, and what drives their energy use. It is a key step in identifying opportunities to increase profitability by lowering energy and operating costs. For example:

• In commercial real estate, decreasing energy costs by 30 percent is equivalent to increasing net operating income by 4 percent.
• In the healthcare industry, each dollar that a hospital saves in energy costs is comparable to generating new revenues of $20.
• In the supermarket retail industry, a 10 percent reduction in energy costs is equivalent to increasing sales per square foot by $70. Realizing these savings can be catalyzed through benchmarking.

Meeting Corporate Sustainability Goals

As the focus on sustainability intensifies, businesses are increasingly expected to play a proactive role in environmental conservation. Energy benchmarking helps organizations set realistic sustainability goals, monitor progress, and showcase their commitment to reducing their environmental impact. This commitment can enhance a company's reputation and appeal to environmentally conscious consumers. The Harvard Business Review succinctly emphasizes the significance of sustainability in a successful business strategy, “Doing well and doing good are intertwined, and successful business strategies include both.” They continued…

A 2019 study found that 73 percent of global consumers are willing to change their consumption habits to lessen their negative impact on the environment, and sustainable product sales have grown by nearly 20 percent since 2014. Millennials in particular are more willing to pay more for products that contain sustainable ingredients or products that have social responsibility claims. If your organization commits to sustainable products and practices, it could gain market share by converting sustainability-minded customers and increasing sales.

Data-Driven Decision Making

Energy benchmarking provides businesses with valuable data on their energy consumption patterns. This data should be used to inform decision-making, enabling organizations to prioritize energy-saving initiatives, invest in efficient technologies, and allocate resources more effectively. Data-driven decision-making is a key driver of success in today's competitive business landscape.

Improved Asset Performance

Understanding how different assets contribute to overall energy consumption is crucial for optimizing performance. Energy benchmarking helps businesses evaluate the efficiency of their equipment and systems, leading to targeted maintenance or upgrades that can improve overall asset performance. This not only extends the life of equipment but also reduces energy waste.

Foundation for Additional Reporting Requirements

Many businesses are now required to track and report carbon emissions. Additionally, they must develop a plan to reduce their emissions and evidence successful mitigation trends. The process requires significant data and often takes companies substantial time in collection and preparation. Moreover, even once the information is collected, reporting can be overwhelming and confusing. Energy benchmarking data can be used to fill Scope Emissions reporting requirements.

And when it comes to getting ready for Scope Reporting requirements, Forbes wants readers to know that getting help is an important step for businesses…

Many companies don't have the expertise or capacity to take on an initiative of this scale and turn to outside help from ESG risk specialists.

Look for a partner with a demonstrated track record in carbon accounting, financial reporting and supply chain management. Consider the partner's ability to provide assurance around Scope 3 accounting processes and disclosures. The right partner—or partners—can save time and money in the long run.

Energy benchmarking is a powerful tool in managing energy consumption. From cost savings and reduced waste to sustainability success and satisfying reporting obligations, the benefits are substantial. If you’re thinking about getting started, be sure to take time to evaluate available options, the costs can vary and don’t always translate to better results.

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