MORE EFFICIENCY, MORE PROFITS

Energy is essential in our daily lives; it helps us to produce food, to transport people and goods, to be interconnected thanks to the power of communication all over the world… Over the future decades more people will have access to energy and will enjoy better living conditions. Nevertheless, we cannot forget the pressure put on our world’s resources such as energy, fresh water and food. Therefore companies need to reduce their energy consumption and increase their energy efficiency. It means using less energy to provide the same service, so as to be sustainable in the long run and decrease the greenhouse effect.

Save energy, save money: At the enterprise level, techniques for improving energy efficiency are constantly

energy-pyramid

developing. Little changes can reduce significantly the consumption of energy. For example energy-saving lighting replacement, installing a programmable thermostat (which

saves around 10% per year on heating and cooling costs) or using sunlight, choosing windows treatment allows companies to use natural light while reducing heat loss. The benefits exceed the costs, therefore companies should not worry about the impact that investing on new energy efficiency products and infrastructures will have on their accounts, as the investment will be repaid and create profits. Furthermore, companies such as Ameresco’s, are willing to objectively develop the best energy management project for each customer in order to guarantee successful investments. The Spanish government, through new decrees such as the obligation to have energy efficiency certificates for buildings, is pushing companies to adopt more efficient technologies and processes.

 

Renewable  vs traditional: Spain is a leader in sustainable energy; renewable energy contributes moreNukes_vs_Reneables than half of Spain’s electricity mix. Hydropower and wind are the most important sources, while photovoltaic and solar thermal are being developed. The AEE (Asociación Empresarial Eólica) calculated that 160 MW of wind energy produced in Canarias reduced 36 million euros the tariff deficit of 2012.It is clear that renewable energy is a sustainable solution, nevertheless in the short run it is really expensive, the actual energy deficit is 28000 million euros, and less efficient than traditional sources of electricity such as nuclear energy. We do not have to forget that Spain depends on international markets as it cannot self-produce all the energy demanded. This is the principal reason for the Spanish energy deficit, and the government does not have solutions to solve the problem rather than increasing the price of it. The Energy commission’s president of the CEOE, Antononio Garamendi, announced that the electrical system in Spain is too expensive. President of Iberdrola, Ignacio Galán, approved and declared that if Spain stopped producing solar energy the electricity bill would drop by 10%. Do we have the money to continue spending on developing renewable energy sources?

 

No to the energy reform: The energy reform carried out last September is based on more taxes to reduce the tariff deficit. This is not the solution to reach a sustainable energy industry and the competitiveness of companies will decline, since extra taxes have been placed in nuclear and hydraulics. Moreover, a tax called “centimo verde” or green penny has been introduced to power plants that use gas, coal and fuel oil. Furthermore, subsidies have been decreasing since the 2008 crisis and companies have to face much more costs than before. The energy reform should be more structured and focus on the long term. Therefore, it is crucial to implement changes that incentive companies to reduce their energy inefficiencies, making competitiveness the highlight of the solution.

 

Better buildings:  Instead of raising taxes or trying to invent a fashionable name for the new tax, the government should implement programs as the USA does. Since 2011 “Better Buildings Challenge” has been in place in order to save energy consumption on construction by reducing the energy intensity. Over the first year, they have saved up to 2.5%, if the trend continues the objective of reducing 20% of their actual expenditure would be achieved in 2020. However, the objective as a company is not just based on reducing energy and saving money, it is also to show leadership by sharing your knowledge and transmit your strategies. As a result companies’ successful approaches are being used in stores, libraries, hotels and all kind of buildings across the USA. This program should be placed in Spain, as it is an incentive for companies to reduce the energy consumption intensity, making companies more efficient.

Conclusion: Overall, it is clear that renewable energy is a sustainable solution in the long term. However the Spanish energy system is not efficient, governments from the past have over-spend by investing in renewable energies, running deficits, accumulating debt. The current government to solve this problem is applying more taxes on energy producers and decreased subsidies. Hence companies do not have enough money to invest in innovation or implement new technologies. Therefore, the government should implement programs that promote leadership, efficiency and competitiveness following those from the United States. Spanish companies need to enter international markets, and the increased taxation is preventing them from doing so.

http://www.abc.es/economia/20131021/abci-espana-tiene-potencia-electrica-201310211202.html

http://www.expansion.com/agencia/europa_press/2013/10/16/20131016193209.html

http://www.gabi-software.com/spain/solutions/resource-energy-efficiency/?gclid=CMLkyv38qroCFVHMtAodrlQANQ

http://www.laopinion.es/economia/2013/10/20/burocracia-lastra-energia-eolica-archipielago/504913.html

http://www.iea.org/topics/energyefficiency/

http://www4.eere.energy.gov/challenge/

http://www.idae.es

Artículo: “Competitividad, energía y cambio climático”, CEOE

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One thought on “MORE EFFICIENCY, MORE PROFITS

  1. Iñigo Peña says:

    “She is Lourdes Nagore, and her role is Org Empresariales;
    I am Iñigo Peña, amd my role is Org Multilateral”

    This is a well-structured essay and contains good points in it; we seem to agree in most of the solutions.
    In the case of the reform that took place in September you mention that the main objective is to decrease the current deficit but in my opinion it also tries to equalize the cost of renewable energy and traditional energy. For that they are increasing the price of traditional energy and they are decreasing the price of green energy. This decrease in green sector is what is causing most problems, because when the firms invested in wind, tidal or solar energy, they were promised that they would sell all the energy produced and when this was done, the traditional energy was going to be sold. They were also promised a price, which as we have seen, was not fulfilled.
    You also suggest that increasing efficiency is a good solution to reduce the current deficit, I think that it would be ideal but hard to accomplish and that the solution is more directed to a bad management carried by the government.
    To conclude, the “Better buildings” program you mention seems interesting and at times like this maybe the solution is to innovate instead of doing the traditional cut on investment.

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