The business benefits of renewable energy

It’s clear that even a modest switch to renewable power could take a big step in achieving the National Development Plan that calls for the procurement of “at least 20 000 MW of renewable electricity by 2030”. And doing so could be very good for business.

Switching to renewable power is the quickest and most cost-effective way for most organisations to cut their carbon footprint, but what about profits? Here, Genergy outline the key reasons why considering renewables makes sense.

It reduces your carbon footprint
Thanks to a change in government guidelines, switching to renewable power can very quickly reduce a firm’s carbon footprint and its energy bills. Businesses generating renewable power may offset it against the number of allowances including section 12B of the Income Tax Act, which allows for accelerated asset depreciation for renewable energy generating equipment, and the allowances in the new Carbon Tax Bill which is coming into effect in June 2019.

It costs less than you think and returns outweigh costs
The switch to renewables is relatively inexpensive, and it’s an investment that brings far more in benefits than it costs. It demonstrates that a business is engaged in good environmental practice, something which is at the heart of all good CSR and employee engagement campaigns.

Energy-saving and renewable energy campaigns have an increasing resonance among staff and customers, and a sustainable energy supply often forms the basis of a company-wide energy saving programme. According to the UK’s Carbon Trust, investing 1-2% of your energy spend on an employee energy-saving campaign can save up to 10% of your energy bill.

It ensures energy security
A major contributing factor to energy security for any country is the understanding of the relationship between economic growth and energy consumption. Much of the worlds’, including South Africa, energy generation fleet is reaching the end of life and is standing at a pivotal point having to decide on the appropriate energy mix that allows transitioning to an environmentally friendly generation fleet.

Until a mix is decided upon and plans actioned, load-shedding is here to stay. According to Stats SA, it one of the biggest reasons the South African economy is struggling with more and more companies turning to alternative power production to keep them afloat during load-shedding.

It could make energy a profit centre
A business can now be an energy generator as well as a consumer. Self-generation of renewable power to cover a firm’s own needs and feeding the surplus into the grid can in effect make energy a profit centre rather than a cost.

While the equipment to tap into solar, wind or other alternative energy sources isn’t free to install, prices are falling quickly, and the potential contribution towards shrinking energy bills and even profitability makes renewable power an attractive proposition that ticks all the boxes of corporate, social and civic responsibilities.

It helps with corporate social responsibility
Indeed, being seen to be environmentally friendly yields commercial benefits.

Companies that invest in renewable power demonstrate to stakeholders that they support regulatory and public policy initiatives towards a low-carbon economy.

Being seen to invest and use renewable energy enhances corporate reputations and may save money by opening access to energy subsidies such as feed-in-tariffs.