Heat counting

The concerns brought about by phenomena such as global warming and depletion of natural resources are starting to be genuinely taken into account by governments. This results in the adoption of various regulations and so called green legislations aiming at achieving GHG emissions cuts.  Recently, public pressure has prompted more companies to register and disclose the results in their annual reports or to specifically created organs such as the Carbon Disclosure Project.

In Britain for example , the Carbon Reduction Commitment will come into effect this year. Among other things it requires firms that use more than 6000 megawatt hours of electricity a year to measure and report the energy they use.

But apart from these exogenous factors of change, endogenous forces are also at work in the area of GHG emissions management. Even while governments are still arguing over the amounts of emissions cuts, many firms already carry out hands on policies to curb their emissions. Many have tracked energy consumption for some time in an effort to save money. Obviously, the issue of tracking down carbon emissions in order to detect potential losses – and subsequently cut them and save both money and the planet- has become a key component of a company’s competitiveness.

But up to recently, most of these firms have used very basic tools such as Excel spreadsheets and databases. This is changing : despite the recession, higher energy costs and green branding are all pushing more firms to enhance the management of their emissions.

This is where Verteego intervenes: a program from Verteego will make a tedious job much easier: gathering data about each store’s energy consumption, be it from lights, air conditioning, transportation or refrigeration. Companies can easily calculate the carbon footprint of their activity, and exactly assess the part of each process in the global carbon weight, thus being able to target the most energy-consuming steps and work on make them more carbon-efficient.

Evidence of how important an issue this is is to be found in British supermarket-chain Tesco’s ambitious plan to halve emissions of GEG from existing stores and distribution centers by 2020.

All this interest gives a sense of how big the business of tracking environmental performance is expected to become. Léo Apotheker, SAP’s former CEO (a software powerhouse) recently suggested that in time, it could even be “on an equal footing with financial accounting”.

At least for now, the needs of most firms are simple: making sure that data is collected regularly and can be audited. But in the years to come, this too will change. Firms will need software that collect data automatically, help them find the best way to manage other resources such as water and waste.

These changes implemented by companies themselves show that companies are, driven by the market shifts, willing to switch to greener processes. A good policy framework should then include some regulation in areas where the market does not work well, such as the energy-efficiency of buildings and applicances. But it would rely largely on by far the most efficient tool in the policymaker’s kit:  a price for carbon.

A carbon price sends businesses a price signal to invest in clean stuff rather than in dirty stuff. The scarcity of carbon makes such an evolution very probable, and makes it inevitable for businesses to resort to solutions such as those developed by Verteego to remain competitive.