Confusion, misinformation, unrealistic expectations and a lack of knowledge amongst FTSE 250 businesses could hamper net zero efforts
We recently surveyed 250 sustainability and energy managers from FTSE 250*, or equivalent sized companies, and who spend £1 million or more on energy, to find out whether they were equipped with all the information they needed to be on course to reach net zero. The results were, to say the least, worrying. They demonstrated that, at best, sustainability and energy professionals lack the basic knowledge to journey towards net zero and, at worst, that many businesses may well be ‘paying lip service’ to their clean energy commitments and are subsequently at risk from greenwashing. The blog below lays out some of these concerning findings in more detail.
It appears from our research that Britain’s biggest businesses are in danger of failing to meet net zero pledges because they lack the basic knowledge and commitment needed to procure clean energy; both of which are, of course, critical tactics to meet net zero. When questioned, more than one-in-four (26%) of sustainability and energy managers admitted that they are not committed to powering their business with clean energy. This is more than expected given the size of these firms and what’s at stake.
And whilst 74% of respondents said that their company is committed to procuring clean energy, the weight of evidence from our study suggested that many of these professionals are unaware of the true makeup of their fuel mix. For instance, when we asked what these professionals rely on to ensure their supplier is providing them with the energy that they say they are, 40% of respondents said they merely rely on their supplier to tell them, and only 14% actually look at the fuel mix disclosure (FMD) of the supplier. Only 15% said they check how many Renewable Energy Guarantees of Origin (REGOs) their energy supplier has redeemed on the Ofgem website.
It seems that so many of the firms we questioned were merely taking their energy supplier’s word on their energy make up, rather than doing their own due diligence. This is a concern as we are witnessing energy suppliers frequently promoting their renewable tariffs under eco-friendly banners, when in reality they are sourcing their fuel from ‘dirty’ sources. In recent years for instance, there has been a sharp rise in energy suppliers purchasing REGOs and European Guarantees of Origin (European GOs) to effectively ‘offset’ their fossil fuel generation. Bluntly, suppliers are masking fossil fuels behind cheap renewable energy certificates and energy professionals at some of the biggest companies in the UK seem to be unaware of this.
Confusion and a lack of knowledge.
There was a great deal of confusion amongst our respondents too. When faced with a list of fuel sources and asked which they thought were clean, 20% of our respondents said coal, a third (33%) said the same for biomass, and nearly a fifth (18%) said gas is clean. There also appears to be confusion amongst these energy professionals about the impact of biomass energy given that 44% said that biomass energy creates less Co2 compared to burning coal.