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Successful companies are decoupling growth from resource extraction and environmental externalities, securing resilient and competitive supply chains and operations.

Rising and volatile costs of raw materials and resources, combined with an uncertain economic environment, have squeezed UK manufacturers. Companies face increasing pressure to optimise their operations and supply chains and to use fewer inputs per unit of economic output.

Resource efficiency programmes designed to cut energy consumption, minimise raw material inputs and reduce waste create significant cost savings and environmental benefits. Many companies are now turning to innovative clean technologies to cut their impact further and build resource independence, for example using reverse osmosis to secure long-term potable water supplies or innovative forms of off-grid renewable energy.

Business value levers

Click on the chart below to view a larger version.

Source: Accenture, 2013

Size of the prize

  • UK clean technology sector growing at an average 4.5% a year, with higher rates of growth in wind, solar and alternative fuel. [i]

  • Almost 1 million people employed in the UK in this sector, and over 25,000 new jobs created between 2010 and 2011. [ii]

  • Sector estimated to contribute 4% towards UK private sector turnover in 2012 with £119 billion in sales. [iii]

  • UK businesses could save £25 billion each year through no or low cost resource efficiency measures alone, particularly from smarter usage of raw materials and minimizing waste (£20 billion a year). [iv]

  • £4 billion a year in savings possible from energy efficiency and £1 billion from water efficiency. Extending payback thresholds to over a year could realise further £36 billion in savings a year. [v]

Diagram source [vi]

Sustainability benefits

If resource efficiency measures are realised in the UK they could amount to a reduction in carbon emissions by 13% for the UK economy as a whole (90 MtCO2), supporting Government and wider EU targets to reduce emissions in-line with climate change goals. Water use could also be reduced by around 25% in the commercial sector, 28% in the agricultural sector and 10% in the industrial sector. [vii]

Examples

  • Marks & Spencer were able to reduce their clothing delivery vehicle fleet by 25% and achieve a 30% fuel efficiency improvement through optimizing the loading of goods and improving logistics fleet management. [viii]

Price rises have had a major impact on our industry. For example, fuel has gone up from 10% of costs a few years ago to 40% of our costs today.

- Keith Williams,
Chief Executive Officer, British Airways

Example questions to ask to help your business consider this innovation area

Opportunity How can we take advantage of new clean technologies to improve competitiveness? How can we ‘design-in’ efficiency to our processes and products? How can we enable our customers to reduce their resource use?
Competitors How are competitors innovating on resource efficiency in their operations, supply chain and their product design?    
Business case What percentage of our cost base is resource procurement (utilities, raw materials, etc.), and what are likely future trends? What are the costs and benefits of investment in operational resource efficiency? How can we best extract value from supporting our customers to achieve improved resource efficiency?
Source: Accenture 2013

References

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