How Small Businesses Are Making Big Impacts With Renewable Energy
Small businesses are making moves in the renewable energy industry. Although small and mid-sized companies represent around 90% of all companies in the world, we know that most emissions come from a small niche of large companies.
Despite this, we’re all connected. Even the largest corporations only produce so many emissions because everyone further down the chain does business with them. In other words, it’s about starting from the bottom and working your way up. Today, we discuss how small businesses can make a big renewable energy splash.
Where Small Businesses Begin Their Clean Energy Journey
Renewable energy has grown at an immense rate recently. In fact, more than 800,000 jobs have been created because of renewable energy alone. Despite this number seeming relatively small, the rapid growth rate has caught the eyes everywhere.
Since 2016, the solar energy industry has created jobs at 17 times the rate of the national economy. Furthermore, it’s estimated that a new wind turbine springs up in the U.S. every 2.4 hours. But how does your business get involved in the energy transition?
It begins with the Greenhouse Gas Protocol, which outlines how your business can reduce its emissions based on several categories within. Let’s go through what this looks like.
Scope 1
Scope 1 begins with what your business can do to have a direct impact on emissions. In other words, these are the actions you take to curb the emissions you emit from your business directly.
For example, you may switch from traditional energy sources to renewables. Solar energy is a perfect example of emissions-free energy, with zero pollution in the water or the air. Moreover, it enhances your energy independence, making you more resilient.
There’s also a big motivation to invest in solar energy because you can claim the Business Energy Investment Tax Credit (ITC), a federal tax credit worth 26% of the total system cost. Not to mention, there are also state and local tax credits that could be available.
Moving to solar is a big deal because it’s the cheapest form of energy there is, and your business can make money by sending excess electricity back to the national grid. For example, California’s NEM 3.0 policy recently changed how much compensation people receive for selling this excess electricity. Knowing the programs in your area is critical to maximizing your savings and calculating the numbers.
Other actions you can take within scope 1 include:
- Replacing your bulbs with LED bulbs, which last 25 times longer than traditional bulbs.
- Investing in geothermal heat pumps to utilize heat stored in water and the ground.
- Changing energy usage to take advantage of local low usage times.
- Implementing an internal recycling system and using sustainable waste management technologies.
- Ensuring your heating and cooling systems are regularly maintained to ensure they operate at peak efficiency.
If you have the money to invest in your green transition, you may also want to electrify your fleet. Switching to electric vehicles delivers a zero-emission way to move around your locale. However, we understand that this isn’t necessarily financially viable for the smallest businesses or if you don’t have a substantial fleet. Nevertheless, it’s well worth considering.
Scope 2
Scope 2 focuses on indirect emissions impacting your business, such as where your energy comes from and emissions from off-site infrastructure. For example, you may find that you’re already getting energy from brown power sources, meaning you’re taking on the emissions from working with these providers.
This is why it’s vital to investigate where your energy comes from, including talking to your utility provider and potentially searching for green energy providers in your area. With 40% of greenhouse gas emissions coming from energy generation, seeking alternatives is one of the most impactful actions small businesses can take.
Utility green traffic programs are another avenue to explore. The EPA issues these green tariffs within regulated markets, letting them buy renewable energy through a defined tariff rate. Of course, some states may be better covered regarding green energy providers than others.
Scope 3
Finally, we have scope 3 emissions. These emissions come from any asset or activity that isn’t owned or controlled by your organization. In layman’s terms, this is where you go through your supply chain.
For example, scope 3 emissions could involve thinking about waste disposal. It could also include business travel and even employee commuting. So, what actions can you take to address scope 3?
- Smart Business Travel – Check the emissions of your flights or consider taking ground transportation. Alternatively, think about whether you need to fly at all.
- Greener Commutes – Encourage employees to make more sustainable commuting decisions, such as carpooling, ride sharing, or public transit. Some businesses even remove commuting entirely by offering remote work arrangements.
- Product Lifecycles – Consider the life cycle of products and change where you source your products, ensuring they come from sustainable sources.
Naturally, no small business can be perfect in this respect when they don’t control where the emissions are coming from. A solution to help the environment is to buy carbon offsets. These are commitments from a company that’ll remove CO2 from the atmosphere through various projects.
Conclusion: Making Emissions Reduction Possible
Reducing emissions requires investment, but it also delivers substantial economic benefits for small businesses in the long run. When starting out, you can begin at any scope that works for you. There’s no obligation to do everything at once. It’s about getting your team together and defining what’s feasible for you.
How is your business making the transition to becoming a net-zero organization?