A recent environment ministry report indicates significant progress by UK businesses in reaping resource-efficiency savings, but says this is just the tip of the iceberg.
Possible and realised savings
A March 2011 study for the UK Department for Environment, Food and Rural Affairs (Defra) shows that British businesses could save some £23 billion (€26 billion) a year by making simple no- or low-cost changes to how they use resources. A further £33 billion (€37.5 billion) awaits those who are prepared to wait for more than a year for their return on investment.
These impressive numbers for 2009 hugely overshadow the more humble saving of £6.4 billion (€7.3 billion) identified in an earlier study for 2006. But the new study uses different data and an expanded scope. A like-for-like comparison paints a different picture: it shows that almost a fifth of the savings identified in the 2006 study have since been realised.
Defra sees this is significant progress, well above the 1%-a-year efficiency gain to be expected from technological improvements. It points out that in times of economic crisis resource efficiency by businesses is seen as an opportunity to decrease costs and build resilience as well as comply with environmental laws. It can also open up new markets through innovation.
Save but… on what?
The greatest opportunities for resource efficiency lie in waste, particularly waste prevention through leaner manufacturing. In total, less waste and less waste to landfill could save UK businesses £40 billion (€45.5 billion) a year, nearly three-quarters of the total potential savings identified. Energy and water efficiency would deliver the remainder, about £11 billion (€12.5 billion) and £5 billion (€5.7 billion), respectively.
When the focus shifts to greenhouse gas emission savings however, it is energy efficiency that has the most to offer. Improved energy use should deliver about half the total possible emission savings of 90 million tonnes of CO2 – 13% of UK annual emissions.
There are still significant opportunities in diverting waste away from landfill. The UK’s National Industrial Symbiosis Programme (NISP), where one company’s waste becomes another’s raw material, is just one example. Although the 0.32 tonne of CO2 saving per tonne of waste diverted is only about a third of the saving for waste prevented, there are high volumes to tackle and some waste is unavoidable, for example in construction. Some of this waste could be re-used on site however.
Sectors with the greatest savings opportunities in their waste stream are chemicals, metals manufacturing and utilities, according to the new study. In the 2006 report, the food and drink, and retail sectors were amongst the top, but these have started cashing in on savings.
For energy, the sector with the greatest opportunity is the same as in 2006: road freight. Few efficiency opportunities have been realised here because of constraints such as customer delivery requirements.
Small and medium-sized enterprises (SMEs) should be the target for future actions to promote resource efficiency. Defra recommends information campaigns, low-cost loans, SME-specific resource efficiency benchmarks and voluntary agreements to realise substantial untapped savings.
EC Environmental Technological Action Plan:
The further benefits of business resource efficiency, (Defra):
A resource-efficient Europe – Flagship initiative of the Europe 2020 strategy: