Comment & Analysis
Crises in the world economy and crises in the Eurozone tend to push environmental issues further down the agenda – or off it completely.
So it is that negotiations over binding multilateral targets for reducing CO2 emissions at the end of the year in Qatar are likely to be greeted with even less enthusiasm – and a whole boatload more of scepticism – than such talks ordinarily, wearily, attract. It's the economy, stupid. And don't you forget it.
Manufacturers in this country have tended to bemoan the government's relatively proactive and unilateral approach to legislating in rules that, they say, increase the burden on energy-intensive businesses at a time when firms are struggling to compete with less rigorously controlled counterparts abroad.
But some believe these mechanisms – such as the carbon price floor – could actually help to spur what they think of as nothing less than a “next manufacturing revolution” in which British companies will discover new levels of competitiveness and profitability.
“Lean and green” may be a tired phrase but Dr Greg Lavery of consultancy Lavery Pennell is working on the premise that it has yet to be fully exploited by engineers. He believes that if many did – through, for example, much greater levels of energy efficiency – they would unlock profits that would constitute a paradigm shift for manufacturing, enabling competitive advantages over overseas firms, greatly reduced costs – and even the prospect of work that has drifted to Asia coming back to the UK.
Lavery's point is that, while many companies may have paid lip service to strategies designed to protect the environment – installing LED lightbulbs, for example, instead of fluorescent lighting – few have actually gone as far down the green route as they might have done.
In comments that would probably not find favour at manufacturers' organisation the EEF, he says: “We think the policy settings in the UK are heading in the right direction. What's missing though is this information gap, to say to manufacturers: 'look, the whole green economy with the carbon floor price is actually a good thing for you – you will become more competitive'.”
Lavery is one of the key players in a not-for-profit initiative called the Next Manufacturing Revolution which is offering firms the chance to assess their energy efficiency and environmental performance – to see if they could save money.
Lavery highlights examples among leading companies: for instance, Toyota is said to have achieved 70% energy-efficiency savings, and Dow Chemical has reportedly saved more than $8 billion since 1990 through energy-saving measures.
Could it work for small firms in the supply chain though? He thinks so.
But he admits: “Information on this is surprisingly scarce.” Enter the Next Manufacturing Revolution. “We want to show companies best practice in this area. The UK has the potential to greatly compress its costs and then we can envisage some of the higher-value manufacturing work that's migrated to China returning to these shores. This is not about subsidies – it's straight economics,” he says.
Is it time to revisit lean and green in the interests of the bottom line? Or has your firm already done all it can to be an environmental leader?