Recession boosts corporate energy-efficiency projects

Almost three quarters of companies are to step up efforts to improve their energy efficiency over the next two years as part of cost-cutting initiatives, according to a major new study from the Economist Intelligence Unit.

The survey of 538 senior executives found that 73 per cent will make energy efficiency a high or moderate priority over the next two years as they seek to lower their cost base.

However, two thirds said that climate change will fall down the corporate agenda overall as firms focus on battling the recession.

Robin Bew, editorial director of the Economist Intelligence Unit, said that while many firms would inevitably switch to "survival mode" and shift focus away from costly climate change initiatives, the survey also showed that support for greener business models had become entrenched in many firms.

The survey, which was commissioned by the Carbon Trust, KPMG, SAP and Shell, found that more than half of firms have established some form of climate strategy, while almost two thirds of companies have undertaken some efforts to enhance energy efficiency in the past two years.

Moreover, a significant minority of 40 per cent say their firms have developed new environmentally focused products or services in the past two years, with 30 per cent claiming further development of such products remains a "high priority".

Bew said while there were fears that "concerns about the economy will weaken any possible progress" at the UN climate change talks in Copenhagen later this year, the results of the survey provided evidence that the business community was broadly in favour of progress being achieved.

More than half of respondents said they favoured more environmental regulation, providing there is a level playing field, while the report noted that there are now more firms lobbying for tighter green laws than those opposing them.

There was also support for a tightening of cap-and-trade regimes, with about two thirds of those respondents operating under such schemes indicating that a carbon price of up to €50 (£44) would have a significant effect on their energy use, with a price somewhere between €30 and €50 per tonne of CO2 seen as the " sweet spot" for driving change.