Energy is what drives the industry and fuels the corporate profit. But it is the same energy that pumps up the costs to unimaginary heights. Oil consumption has deeply impacted the balance sheets in America. Being unpredictable in its price movements and being a greater percentage of import bill, oil has been one of the major cost drivers in the industry.
Energy
efficiency is the optimum and efficient usage of this energy in order to
maximize every penny invested while minimizing the cost incurred in the production
process. Fuel is demanded by almost all the sectors of the economy and its
efficient usage can save billions leading to not just better earnings but also
better jobs, environment protection and competitive advantage. Dow's investment
to save energy got return of 9 Billion in savings. BP met its carbon reduction
goals eight years earlier and made several billions.
Energy efficiency is not a fancy talk but a practical and a doable thing. It can offset population and economic growth along with the decarbonization of fuels. It is expected that carbon emissions will treble by 2100. A 1% or 2% intensity cut are enough to offset the pressure and stabilize the carbon emissions. But there are nations like America who has been reducing the intensity by 2% to 3% every year for many years. Some firms have done more than walked the talk and have reduced the emissions by 6 to 16% per year. It should not be hard for nations like India and China where they are building their infrastructure for the first time to reduce the emissions by 3 or 4% because it is a lot easier to build smartly than to fix it later.
A detailed study published by Pentagon in 2004 built a competitive case for five industries, their energy efficiency and impacts. It was found out that cars, heavy lorries, airplanes, military and fuels are the sectors which handles energy efficiency can hedge America against all oil impact and rather turn energy efficiency into profit.
For example, transport uses two-thirds of oil. The common solution is to improve the efficiency of cars, heavy lorries and airplanes by making them lighter, slippery, advanced engines and better propulsions. All these can be met while keeping in mind all the comfort, performance, safety issues in mind. Carbon fiber bodies, diesel hybrid engines, structural changes etc. created efficient machines which can use oil more efficiently thus increasing the savings.
Tweaking the design systems creates synergy in a much simpler manner. Just lay color in the mold and you don't need a paint shop while manufacturing cars. The plastic parts can snap together for bonding and there will be no need of robotic arms and welders. You can save much oil per kilometer if you use a diesel-electric hybrid. Lighter manufacturing materials and use of latest technologies can advance the agenda of energy efficiency in a greater and realistic manner leading to billions in savings.
Another example could be of air conditioning for the hotter climates. A green energy efficiency house built to have more air volume, air circulation, capturing sunlight via solar panels to create electricity can reduce dependence on energy saving money and also generating more resources. Smart grid technology along with IOT devices can lead the way to better efficiency.
The shift in power market and carbon trading has unlocked more money for better usage and expansion. Private investment should lead the market through innovations while the government should back private efforts by laws and regulations that empower them and not act as a hindrance. Energy efficiency is important not just for the balance sheet but also reduces import bill reducing trade deficit.
