While some companies associate sustainability with added costs, sustainable business practices actually deliver value to society and can be a growth engine for business. The United States’ experience over the last decade shows how a country can reap the benefits of increased private sector sustainability efforts. With the right policy support, the corporate sector can do even more to expand and accelerate these practices. Though companies may have different experiences, our efforts demonstrate that it is possible for the industrial corporate segment to integrate sustainability into its strategy while still delivering strong returns to shareholders.
At Ingersoll Rand, we made a climate commitment in 2014 to reduce the greenhouse gas footprint of our refrigerants portfolio by 50%, to set aside $500 million to invest in low-carbon solutions, and to reduce our own greenhouse gas emissions by 35%—all by 2020. We are on track to meet these commitments and have achieved our 35% emissions reduction two years early. Building on our own successes, as well as promoting corporate adoption of sustainability initiatives, will require the creation of policies that encourage greater energy efficiency and improve the resiliency of the electrical grid.
A good place to start would be the creation of energy efficiency resource standards by the Federal Energy Regulation Commission or the state public utility commissions that direct utility investments. (Energy savings targets of 1.5—2% are already seen in some states.) Advancing energy efficiency is a major contributor to the United States’ ability to delink GDP and energy demand while creating financial savings for consumers at the same time.
We would also welcome additional rules clarifying the valuation of distributed energy resources and demand response solutions, such as energy storage (including thermal storage). In order to capture the true value to society, valuation guidelines must reflect the solid return on investments for consumers and commercial businesses. When we take into account the full value for stakeholders (utilities, building owners, and a public concerned with reducing greenhouse gas emissions) we can accelerate these investments even more, which will, in turn, create additional value.