New purchasing models driving sustainability

30 July 2020

New purchasing models are proving to be one of the key drivers for the adoption of energy and sustainability data management programmes, a survey has found.

A fifth (20.9%) of respondents to a survey held as part of Schneider Electric’s 2020 Energy & Sustainability Progress Report said new purchasing models were driving them towards greater sustainability.

For the third year in a row, Schneider partnered with GreenBiz to survey the opinions of 265 global energy and sustainability professionals from corporations earning more than $250M in annual revenue in 17 different industry segments.

Schneider said respondents ranged from individual contributors to C-level executives representing multinational businesses in regions including North America (69%), Europe (21%) and Asia (7%).

Stakeholder expectations for energy and/or sustainability transparency were the most commonly cited driver for the adoption of energy and sustainability data management programmes, being referred to by 58.8% of respondents.

More than half (52.7%) referred to a greater need for data and analytics.

The report found 16% used savings derived from procurement to fund energy and sustainability projects, while organisations typically relied on capex, opex, or a combination of the two.

The survey found energy management is becoming increasingly complex due to regulation, distributed assets, globalisation, new technologies, and market and price volatility. Almost nine in 10 (87%) agreed or strongly agreed that “energy procurement is increasing in its scope and complexity”.

Last year only 29% of respondents cited strategic energy sourcing as a top initiative for cost savings, whereas this year 46.5% of respondents said timing and pricing volatility was the single biggest challenge for energy and sustainability managers today.

“In a market subject to rapid fluctuations driven by extreme temperature changes and geopolitical and trade tensions, the difference between the right energy purchase and the wrong one could translate into millions of dollars,” the report said.

Schneider said its research had been conducted in the fall of 2019 and that it recognised that the coronavirus pandemic would have far-ranging social and economic ramifications that could not be predicted.

“We also acknowledge that these impacts may ultimately change the energy and sustainability trajectory that many organisations were on at the turn of the decade,” it said.

The company said it had decided to publish the report despite this as the work of energy and sustainability professionals was set to be more important than ever in the new normal.

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