Efficiency: Everyone talks about it, but ...

Energy efficiency is, sad to say, a bit too much like the weather: everyone talks about it, but no one does anything about it … or, at least, not enough do.

Yet another report, this one produced by Carbon Connect and sponsored by Consensus Business Group and Siemens, has come out showing just how much energy — and money — businesses are wasting every year through efficiency failures (£6 billion a year in the UK alone, in this case). It’s the latest in a long line of research that proves what should be a simple, powerful and compelling truth: saving energy is good for the bottom line.

So why on Earth aren’t enough people and businesses actually doing so? A few reasons come to mind:

• You need money to save money. In other words, energy efficiency might be a good investment for Cisco or Oracle because they’re giant multinational firms with budgets to cover such things. Without incentives to help pay for the upfront cost, though, an insulation upgrade, double-glazed windows or a new boiler can be out of reach for the proprietor of a small gift shop or a retired couple on a pension.
• The “endowment effect.” That’s a 10-dollar name for a two-bit reality of human nature: the tendency to stick with business as usual unless a factor that’s hard to ignore gives a push for change.
• Diffusion of responsibility. Another feature of human psychology, this is the tendency of people in large groups to not act … either because they believe someone else will, or they think their inaction won’t reflect poorly on them because they’re just one person in a crowd.
• “Do as I say, not as I do.” Telling others how important and beneficial it is to conserve energy is nice, but officials and business leaders have often been guilty of sending mixed messages. There’s BP still saying “Beyond Petroleum,” for example, while the Gulf of Mexico continues to choke on leaking oil from last year’s blown-out well. Or take the current UK government’s pledge to be the “greenest ever” while at the same time planning to scrap a plan that would have let individuals invest in the low-carbon economy.
• Market failure. The United Nations’ Environment Programme recently released a study showing that a green economy could also be a growing one. It pinned the blame for our ongoing brown economy on market failure: a combination of inadequate government policies and regulations, and disincentivising business models that prevent us from taking the steps we need to take.
• It’s just not sexy. Look at all the effort that’s gone into making compact fluorescent light-bulbs not look like compact-fluorescent light-bulbs … as if the shape of one’s light source is more important than the size of one’s electricity bill at the end of the month. As opposed to, say, cool web-enabled interfaces and mobile apps that let you turn off your home’s dryer or switch on some music before you get home, things like better insulation and more efficient lamps are just so dull, aren’t they? (And, yes, the interfaces and apps can also improve efficiency, but why not tackle the lowest-hanging fruit first?)

For all of the above reasons, energy efficiency isn’t universally treated as important and made a top priority everywhere. Fixing that won’t take just government action, or business action, or individual action, but all three put together … with all three actively working together. Otherwise, we all risk sitting around assuming someone else will take action first until yet another report is released somewhere down the lines telling us yet again how energy efficiency makes financial sense.