The $3 Billion Challenge

September 17, 2019

Author:

360 Energy

Canada’s businesses can realize $3 Billion in annual cost savings just from taking a simple business approach to manage their energy. We reached this estimate at 360 Energy after reviewing our customers’ achievements over the past 25 years.

Every company that has implemented a comprehensive energy management program has seen its productivity and operational performance improve. With little or no capital outlays, they have all consistently saved at least 5% on their energy costs. By projecting that track record nation wide, the potential for energy management productivity gains is at least $3 Billion:

2017 Fuel Usage - Total Industrial, Agricultural, Commercial and Institutional by Type

Fuel TypeFuel AmountEstimated Consumer CostNatural Gas & NGL2,152,255 TJ$12.9 billionElectricity321,148 GWh$32.1 billionRefined Petroleum Products15,760 ML$15.8 billionTotal$60.8 billionEstimated 5% savings (annual)$3.04 billion

Data from Table 1-1 and Table 2-1 from Statistics Canada's 2017 Report on Energy Supply and Demand in Canada
Costs based: on $6/GJ (NG); $0.10/kWh (Elec); $1/L (Petroleum Products)

A national program, targeted to help all Canadian enterprises better manage their energy costs, would do wonders for our nation’s economic prospects. There are now enough Canadian businesses that have succeeded with this concept, a smart effective energy management program could easily be advanced across the country. 

Canadian businesses want to be positioned for growth while also reducing environmental and climate impacts. What has been missing, is a pathway to get there; a process that shows companies how to make steady, continual improvement in energy efficiency and cost reductions over time. 

This past summer, I had the honour of being invited by the Business Council of Canada to participate in a roundtable on Canada’s Economic Future. The discussions convinced me that even small-scale changes to our pattern of energy use would have enormous benefit to our country. 

A national smart energy management strategy would assist individual Canadian companies achieve their Environmental Social and Governance (ESG) commitments. Many businesses are beginning to be scored on their climate related risks from such programs as the Carbon Disclosure Project (CDP).  Retail facing companies are requiring carbon management disclosures from their suppliers. Financial institutions are measuring and qualifying businesses, indeed entire industrial sectors, based on how well they are managing their exposure to climate risks. A smart energy management program would help Canadian companies mitigate these business risks. 

Reducing fossil fuel use reduces greenhouse gas (GHG) emissions. Not only would simple energy management steps help save $3 Billion annually, they would eliminate nearly 10 Million Tonnes of CO₂ each year:

Fuel Amount5% Reduction106,086,2165,304,311 48,172,2602,408,613 43,604,0682,180,203197,862,5439,893,127 T CO₂e

Calculated using Guideline for Quantification, Reporting and Verification of Greenhouse Gas Emissions Effective November 2017, the National Inventory Report 1990-2017 Emissions Factors, and Table A13-1 from the National Inventory Report 1990-2016: Part 3

A national program for enterprise-level energy management would enable Canadian businesses to become more competitive and innovative, enhance teamwork between departments, trim their environmental footprint and foster a corporate culture of continual improvement. 

There is a massive opportunity for a national energy management initiative. But it will need to be driven by businesses. This is not a call for greater regulation.  We have to stop thinking governData from Table 1-1 and Table 2-1 from Statistics Canada's 2017 Report on Energy Supply and Demand in Canadament or utilities are best suited to initiate or lead energy initiatives.  

Canada is already a global leader in supplying energy. It is time Canadians become leaders in managing energy use as well.  Improving energy productivity would improve our country’s branding. Using energy conservation to become more competitive would advance our position in the international marketplace. 

We cannot afford to be complacent about our economic prospects. A national energy management program would enable our government and business leaders to responsibly manage our endowment of energy and water resources for growth and jobs within a smaller environmental footprint. 

Smart energy management is a low-cost investment strategy with high returns for Canada.