By Andrew Stevenson, Shell New Energies Global Accounts on Dec 23, 2020
For corporations and global enterprises that fall into the latter category, establishing a foundational strategy or “roadmap” can be a key starting point. From my perspective, there are a few common steps in these sustainability roadmaps that businesses might consider as they chart their own course toward end-to-end sustainability solutions. Understanding these steps can help organizations self-assess their own level of readiness and identify the types of expertise they must access in order to move forward.
1) Define Business and Sustainability Goals
Clear-cut goals allow organizations to define success and envision the steps leading up to it. While some companies are readily aware of precise sustainability targets, others need help understanding their existing carbon footprint and itemizing the desired outcomes.
Regulatory requirements may compel some of these goals, but compliance mandates aren’t the only factor to consider. External incentives, internal values, stakeholder demands, and economic forces in the energy market are all worth evaluating. There are often industry-wide or competitive considerations, especially if the sector in which a company participates has customers that value a sustainably produced product or service.
2) Match Challenges to Current Sustainable Practices and Energy Products
Large enterprises have to take multi-faceted approaches which include both large and small considerations for different aspects of operations and the supply chain. In such an integrated solution, there are usually several possible levers to pull to implement an overarching decarbonization strategy.
For example, is replacing an existing power source with renewable energy the only goal, or are emissions from operations and supply chains in scope? The former requires a relatively simple solution of procuring power from solar or wind projects, while the latter potentially calls for the addition of carbon offsets or other business environmental solutions to address emissions that can’t be avoided.
Challenges also vary by sector. An enterprise dealing in fast-moving consumer goods may be motivated to address the emissions of middle- and last-mile vehicles with electric vehicle infrastructure, while cloud data centers may look to onsite solar generation with behind-the-meter storage as a means of reducing reliance on fossil fuels.
Further, many organizations face unique challenges that can’t be overcome with widely available turnkey energy products. These circumstances call for collaboration with like-minded companies or suppliers to co-create solutions that accelerate their decarbonization journey.
3) Prioritize for Near-Term Impact
Many companies have cause to pause at the commitment and investment timeframe of decarbonizing their operations. However, the previous step of matching challenges to solutions can present several options that allow these companies to start making progress toward long-term goals right away.
Low-hanging fruit may come in the form of standard or structured renewable energy products. For example, renewable energy at scale is much more accessible now than in previous years.1 The levelized cost per unit of electricity from utility-scale onshore wind and solar plants respectively dropped 70 and 90 percent over the past decade.2 While procurement mechanisms like physical and virtual power purchase agreements (PPAs), which are leveraged by many corporations to quickly green their energy mix are becoming more common, there are complexities and risks inherent that must be understood when making that choice. Depending on a company’s situation and needs, there may be simpler solutions available such as bundling green attributes into a retail agreement, where the regulatory environment allows.
From the infrastructure side, distributed energy resource (DER) solutions can offer robust, actionable steps in an integrated plan to lessen facilities’ overall energy consumption. Some of these programs operate on a subscription model, granting companies access to infrastructure and efficiency upgrades on a rolling payment basis, rather than requiring substantial upfront investment.
4) Execute and Expand Solutions Across Operations
At this point, planning turns into execution, which is also dependent on the scope and scale of the company’s operations and goals. First steps like greening the energy mix can be implemented relatively quickly depending on a company’s particular situation. However, at the enterprise scale, the integration effort of deploying strategies vertically and/or horizontally poses a longer term challenge.
End-to-end sustainability requires procuring and deploying multiple energy products, along with an overarching vision for bringing them together, measuring their impact, and ensuring goals are met. For help visualizing what an end-to-end sustainability solution might look like for your brand, check out this resource outlining paths to a greener supply chain.
One way to streamline these efforts is to work with an energy company that can offer multiple solutions as well as the trading power and expertise to bring them to fruition. For example, Shell Energy has the scale of supply, global footprint, scope of services, and vision for the energy transition which grants us the ability to create end-to-end solutions encompassing multiple energy products. Our customers benefit from assistance creating roadmaps of their own, as well as access to leading-edge solutions across North America and Shell’s separate 24/7 trade desk for tailored renewable products and offsets.
Regardless of which energy partner(s) a company chooses to work with, reviewing this sustainability roadmap can shed light on how well an organization is equipped to envision its low-emissions future. For companies that don’t know where to start, a collaborative approach is particularly important. By building relationships that combine resources and expertise, stakeholders can become better equipped to lay out a roadmap, establish benchmarks, and achieve environmental sustainability in business.
By Andrew Stevenson, Manager, Shell New Energies Global Accounts
During his more than 35-year career at Shell, Andrew has engaged with global B2B and B2C customers across a variety of sectors, in over 20 countries on five continents. His current focus is on collaboratively developing integrated sustainability solutions for companies around the globe.