New energy savings law ESOS will be have a profound affect on businesses. For enterprises, clean tech and born in the cloud businesses now is the time to take notice.
On July 17th 2014 a new UK law came into place known as the Energy Savings Opportunity Scheme (ESOS) (UK Gov ESOS Scheme). For enterprises interested in doing more to be sustainable by saving resources such as energy, water and land use, those in clean tech and IT companies supplying the solutions that underpin increased sustainability in and the emerging cloud providers that can better and faster enable the sustainable enterprise plans this is an important law.
Aimed at around 9,000 UK enterprises ESOS requires them to do energy audits and make plans for reductions. This actual need to do something will come as a shock to most of them.
Research done by Cambium LLP in 2013 shows that around 3% to 5% of the total investment in energy reduction and carbon management projects will be in IT systems and IT consultancy. The implication is that over the next 15 years, a net new IT market will grow with a size of £0.1bn to £1.0bn in IT systems just for enterprise energy efficiency improvements. The expected annual growth rate of this IT market is in excess of 11%.
If only 5% of these plans are acted on, the UK Government expects there to be a net benefit to the UK of £1.6bn by 2030. This implies a total investment in energy reduction schemes of at least £3.3bn over the next 15 years but could be as high as £33bn. ESOS Market Size Blog
Spreadsheets and central IT won’t work alone
ESOS will lead businesses to do more at the start and then evolve over the next few years across 5 key areas.
Compliance with the legislation and providing the data and reports is just the start of the need for quick solutions. All enterprises will need a compliance solution.
Further resource management projects will spin off this kick-start in many enterprises as they realise the resources and money they have been wasting and can reasonably control
Building to larger sustainability projects. The new awareness in enterprises is expected to launch many of them to review sustainability right across their functions and to look for solutions to address the management of increasing sustainability objectives
Large volumes of data, analysis, reports will need to be gathered, analysed and acted on
Real-time global inputs from sensors will become the norm to support the energy reduction systems and then more required to support wider sustainability initiatives
The cloud has a role to play
The enterprises will need to move fast to gather data and create the initial position report for the business just to be compliant. Many are expected to do the minimum that is required at first. This will change over a number of years into a structured and broad approach to resource use reduction and sustainability that needs an integrating, adaptable, global and scalable set of solutions. They will not want yet more bespoke IT systems in-house.
They will not know the application and data architecture that is best for some time. This will lead them to a flexible initial approach that does not get baked into the only way forward. They will be looking for application solutions that can get bigger faster or even scale up and down at times, as well as systems approaches that can be reused and re-purposed across new sustainability applications.
The sounds like many of the good features of solutions in the Cloud.
What can cloud providers do now?
Cloud service providers need to make sure they understand the initial and near-term solutions and capacity needed by enterprises in the UK, EU and beyond.
ESOS Compliance, Energy Reduction and Broader Sustainability will be a major focus in actioning the energy saving changes.
Those providers who develop an offering for these 9,000 new prospects will be first to benefit from the opportunity first. And there is room to scale. Those cloud initiatives solutions might start as small projects could quickly grow into much larger implementations. Starting small can lead to an enduring and fruitful relationship.
For providers who are not in a position to develop their own solutions, they need to find an application partner (ISV). Partnering with an ICV could create new, featured services such as:
- ESOS Compliance as a service (ECaaS
- Energy Efficiency as a Service (EEaaS)
- Sustainability as a Service (SUSaaS)
ESOS will have a profound affect on businesses. But this new energy savings law certainly has some benefits to those cloud providers who are first to market.
About Cambium
Cambium help suppliers to grow their sales to enterprises interested in energy efficiency, sustainability and corporate responsibility. We understand know which organisations are actively investing in these topics and how to reach the key decision makers. We help our clients position their products with the right audiences in a way that gets attention.
No matter if you are a new entrant to the UK market or an existing player seeking to improve the effectiveness of your sales and marketing, Cambium can help your grow your pipeline and improve conversion rates in these rapidly growing markets.
To discuss the implications for your business or discover more, contact us at Cambium LLP
Co-founder of a management consultancy Cambium, which helps clients accelerate the adoption of technologies and services in high growth Sustainability Solution markets. Originally an environmental research scientist, Tony subsequently changed direction to be an experienced business leader with a solid track record of driving the profitable growth of technology companies in the UK, Europe and Asia, including both major global businesses and start-ups.
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