Creativity needed as energy risks grow

With prices for commodities from food to oil — which are, after all, linked — rising to new highs, there’s a growing threat to stability for individuals, businesses and governments alike. So how can people and organisations insulate themselves from risk? The top priority: to limit their exposure to volatile energy prices as much as possible.

And the sooner they start, the better. Just today, International Energy Agency chief economist Fatih Birol warned that higher crude oil prices meant “definitely a risk of major negative implications for the global economy.” Coupled with record-high food prices and costly natural disasters likely linked to climate change, current trends mean “business-as-usual” strategies are the wrong way to go.

Instead, the smart response is to reduce energy and resource consumption, diversify supply sources and pursue across-the-board sustainability measures.

Let’s look at how some businesses are moving in the right direction in this regard:

• Electric mobility: Simply getting employees to work becomes more expensive when oil prices are in the triple digits. Siemens is addressing that risk by testing a 100-car electric fleet for employees at its Erlangen and Munich locations. Launched late last year, the three-phase test is aimed at researching and developing new business models for electric cars.
• On-site agriculture: The Kyocera Group insulates many of its office buildings and factories with green curtains of goya, morning glory and other climbing plants. In addition to helping to reduce indoor cooling costs and absorb carbon dioxide from the atmosphere, the vines produce bitter gourds, cucumbers and peas for the employee cafeterias.
• Local energy: L’Oreal’s factory in Libramont, Belgium, is not only carbon-neutral but produces more energy than it uses. The plant converts local farm and food industry to methane, which is then used to produce all the electricity the factory needs as well as 80 per cent of its heating power. Surplus electricity is fed back into the national grid while the waste from biomethane production is returned to area farms for use as fertiliser.