Preparing for a clean-energy future: thought talked about for years it's a long, slow road to become truly resource-efficient. Legislation may ultimately drive the process, but in the meantime, forward-looking companies are getting a head start by understanding the energy they use and making responsible usage decisions.

• Author: Tobin, Mike

Given recent developments in both technology capabilities and government incentive programs, it's an exciting time to build an organization's sustainability strategy by exploring alternative energy solutions. There are many things that can be done within a company to prepare for a sustainable clean energy future and the increased influence of alternative energy.

By understanding the energy currently used and new technologies, as well as the myriad of local, state and federal incentives, initiatives and regulations, a business can create a successful strategic plan to capitalize on the available opportunities.

Energy Costs of the Future

Many companies track energy costs closely. In light of recent energy rate fluctuations as well as current legislation, this becomes an even more important aspect to consider in business operations. The price of energy will undoubtedly continue to rise due to increased global demand, regulation of greenhouse gas (GHG) emissions and the implementation of Renewable Energy Standard (RES) requirements. The cost to clean up dirty fuels in order to meet regulations related to GHG emissions will increase business and consumer costs.

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Renewable energy requirements may also increase the short-term cost of energy in some locations and not significantly affect the cost in other areas. Over the long-term, however, it is expected that renewable sources will provide energy at lower costs with less variability.

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Translating these changes into strategic business opportunities requires discussion and analysis around minimizing energy rate risk. The discussion may include hedging and energy purchasing strategies that are becoming more common. The discussion should also include more in-depth considerations about strategic facility location and its relation to energy sources.

Know Thy Energy

To better understand the true cost of energy, a company must begin to question the source of its energy as well as its associated future issues. For example, coal is a relatively abundant fuel source in the United States, but is considered rather "dirty" compared with other fuel sources. In addition, coal from one area can be "dirtier" than coal from another area.

Thus, as local coal plants adjust to proposed regulations, those plants in the area with the dirtier coal may incur higher costs to meet emission standards, which, in turn, will result in higher costs to energy consumers. Extrapolate from this simple example the impact the anticipated regulations could have on the cost of our nation's different fuel sources.

Questioning the cleanliness of the local fuel source and the utilities' cost to comply with anticipated emission regulation will provide invaluable insight into the future of a company's energy costs.

It's important to start asking these questions now so that a comprehensive plan can be developed to identify issues and opportunities before rate changes catch companies off guard. The result may be that a company negotiates a long-term energy rate, decides to purchase from a different energy source or decides to relocate.

The earlier such conversations are started, the more options and opportunities exist for the company to consider, particularly if relocation is the preferred action.

Maximize Exposure to Renewable Energy

Another issue to investigate...