There is an increasing financial benefit for companies to reduce energy consumption, according to a report published today by Nordic Credit Rating (NCR). The past year has seen a dramatic rise in energy prices, as well as increased uncertainty over energy supply and price volatility for the foreseeable future, following Russia's invasion of Ukraine and the EU's subsequent reduced purchases of Russian gas. This adds a new dimension to efforts to improve energy efficiency and add in-house generation, which have previously mainly been regarded as environmental investments.
"Energy efficiency investments and in-house generation of renewable energy have been a focal area of corporate sustainability reports for some time, but the emphasis is now on the financial benefit," said NCR credit analyst Ylva Forsberg. "We are more likely to pay attention to companies' energy usage and efficiency in a higher-price environment. We also expect companies to continue these investments in 2023, despite the high cost of capital, due to the increased financial return."