A sustainability tool known as the Marginal Abatement Cost (MAC) curve, prioritises carbon emissions reduction projects. The MAC curve was pioneered by McKinsey and Company and originally used to deliver a successful study of global abatement potential. Nowadays, it is heralded as the more powerful tool in sustainability...
However, if organisations want to capitalise on the financial incentives from carbon emissions reduction, they should focus on utilising the expertise and intelligence that sits along the MAC curve.
The backbone of achieving a successful level of sustainability is employing accurate carbon emissions data. This is essential to deliver your benchmark footprint and therefore creating accurate return on investment forecasts. Thanks to the UK legislation drive, the market for carbon emissions data capture tools has grown rapidly over the last two years, making it significantly easier for organisations to consolidate their data on one platform, without relying on multiple spreadsheets.
While organisations are primarily focusing on collecting their electricity data, there are a number of other sustainability metrics that organisations may not realise could play a huge part in their carbon emissions reduction, being waste reduction and transport an example of two of them.
Therefore, businesses will need to source and collect all their sustainability data and invest in a platform that can do this within the minimum time expense. The second part of the process is to understand your organisational drivers and restrictions when it comes to energy efficiency projects.
Also, increasing fuel prices will ultimately increase the attractiveness of long-term energy efficiency projects, and viceversa. To mitigate unknown fuel prices a solution can be binding your energy procurement strategy in with your sustainability strategy. This will deliver a more robust MAC curve, with a greater understanding of the financial implications.
Abatement strategies are important to reduce the long term costs of carbon emissions. Such models define in more detail the expected future costs of carbon emissions to enable long term investment strategies.
However, the biggest reported barrier for implementing abatement strategies is financing. Capital expenditure projects are unfavourable in these economic times, and when wrongly invested, these projects can deliver net loss or margin erosion.
Developing a robust business case using the expertise of data and strategy, MAC curves and financing will greatly increase your success of achieving an effective sustainability strategies.
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We help our clients reduce their carbon emissions - helping them to conserve energy, save money and boost business performance.
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