The world is transitioning to a low-carbon economy, and businesses are at the forefront of this shift. Renewable energy is becoming the go-to option for companies seeking to reduce their carbon footprint, improve brand reputation, and future-proof their operations.
However, as the world grapples with the challenges of climate change, energy efficiency has become a critical component of business sustainability. Small and Medium-sized Enterprises (SMEs), which are the backbone of many economies, are currently facing unprecedented pressure to reduce their carbon footprint and improve their energy efficiency.
Read also: ‘Energy efficiency key to boosting Nigeria’s downstream sector’
With limited resources and tight profit margins, SMEs may find it difficult to invest in energy-efficient technologies and practices. However, the long-term benefits of energy efficiency far outweigh the costs, and SMEs that prioritise energy efficiency are more likely to achieve business sustenance and success in the competitive market.
This is because renewable energy offers numerous benefits for businesses, which in the long-run outweighs the high cost associated with transitioning to renewable energy. Renewable energy sources like solar and wind are becoming increasingly cost-competitive with fossil fuels.
“One of the major costs of running businesses in Nigeria is energy and we believe that if the cost of energy can be tackled effectively, businesses will have proper structure for their finance,” Olanrewaju Ogunkunle, founder/CEO, Revocube Energies, said during the maiden Renewable Energy Summit 1.0 with the theme, ‘Empowering the Future of Business with Renewable Energy’.
According to him, anybody that can afford a generator in Nigeria can afford a solar system. He however, disclosed that people do not get enough information to make the right choice on transitioning to renewable energy. “There is a solar system for every size. For renewable energy, it’s a new day, a new power; the sun is what is needed.”
Furthermore, companies that invest in renewable energy are seen as responsible and forward-thinking. Also, there is increased energy independence where on-site renewable energy generation reduces reliance on grid electricity.
The renewable energy industry is creating new job opportunities in manufacturing, installation, and maintenance. But, with carbon emissions reduction, renewable energy helps businesses meet their sustainability goals and reduce their impact on the environment.
Currently, companies like Google, Amazon, and Microsoft are already leading the charge in renewable energy adoption. Google, for example, has committed to powering 100 percent of its operations with renewable energy by 2030. Similarly, Sterling Bank recently powered its head office in Lagos with renewable energy leveraging the solar advantage on this part of the world.
In addition to corporate leaders, more SMEs in Nigeria are also embracing renewable energy. SMEs can benefit from government incentives, tax credits, and financing options that make renewable energy more accessible.
“Many people do not know that there are grants for practitioners in this sector. There’s actually a grant that one can get from the central bank to mitigate the challenges of financing and funding especially to help Original Equipment Manufacturers (OEMs) and service providers like Revocube Energies,” said Olawale Ajibola, director, National Centre for Energy Efficiency and Conservation, (NCEEC).
Ajibola said further that bridging the information gap about energy efficiency and transition is critical for small businesses. According to him, many people do not have the knowledge to understand the essence and importance in investing in renewable energy. “We at the national centre for energy efficiency and conservation have been sensitising the public on the need to invest in renewable energy.”
However, corroborating Ajibola’s position, Ogunkunle said that the future of business is renewable energy. This is so because as technology continues to improve and costs decrease, renewable energy will become the norm. Companies that invest in renewable energy today will be better positioned for long-term success and sustainability.
According to industry experts, empowering the future of business with renewable energy is a smart business decision that benefits both the bottom line and the environment. Similarly, it was stated that forward-looking SMEs can join the renewable energy revolution to future-proof their businesses.
“In my office, I don’t bother myself with the cost of electricity, grid collapse or generator. We save a minimum of N5million monthly by using renewable energy. The total cost we spent was close to N60 million and this equipment will last us for a minimum of 10 years. There are apartments in the building that run AC round the clock. There is no peace bigger than not thinking of grid collapse or fuel,” he said.
Ogunkunle said further that information dissemination is one of the key reasons SMEs are not migrating, because they do not have enough information that they can spend less using renewable energy.
“Merchants of renewable energy have been doing poor jobs too in the manner they market; telling people that a solar can power a fan and television is not the best way to convey the message. The message should be how much can be saved using renewable energy.”
Speaking to the slow energy transition in Nigeria, Ogunkunle asked to know why businesses are not switching to alternative sources of power. “Imagine everyone in a building that has 20 apartments running generators at once.
“Renewable energy customers recharge their prepaid meters like PHCN customers, and there are houses that rely on solar systems. Maintenance of solar power is cheaper than the maintenance of generators,” Ogunkunle said.
Currently, SMEs are regarded as the engine of economic growth, accounting for over 90 percent of businesses worldwide. However, they also face unique challenges, including limited resources, tight profit margins, and intense competition. However, energy efficiency is critical for SMEs to maintain their competitiveness, reduce costs, and improve their bottom line.
SMEs are significant energy consumers, with estimates suggesting they account for over 50 percent of total energy used by businesses. Improving energy efficiency can help SMEs reduce their energy bills, lower their carbon footprint, and enhance their sustainability. Moreover, energy-efficient practices can also improve workplace comfort, productivity, and employee well-being.
“The sun has been a symbol of energy and life since ancient times. In the field of renewable energy, solar energy is known as the most potential green energy because of its clean, safe and endless advantages,” Young Yang, sales manager, Gospower Electric Technology, said.
He disclosed that adhering to the concept of green energy to light the future is in alignment with Gospower business operation. According to him, the company is committed to research and application of solar energy technology, and strives to provide efficient and environmentally friendly energy solutions for users across the world.
“Our solar products have passed the rigorous tests of international authorities and obtained a number of certifications. This is not only an affirmation of the quality of our products, but also recognition of the credibility of our brand.”
Despite the benefits, many SMEs lack the resources, expertise, and capital to invest in energy-efficient technologies and practices. Therefore, it is essential to provide SMEs with access to financing, training, and support to help them prioritise energy efficiency and achieve their business goals. By doing so, SMEs can become more resilient, competitive, and sustainable, contributing to a brighter economic future.
