How are entrepreneurs capitalising on divestment?

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Many businesses (and politicians) will be keen to know the outcomes from the UN Climate Change Conference in Paris later this year. But change is already well under way in the business world and certain entrepreneurs are pushing for more.

It’s true that many entrepreneurs will admit that cutting carbon emissions is not their highest priority. Their attention is likely to be focused on the day-to-day running of their businesses, getting the next deal or contract, and ensuring cashflow is strong. But for other companies, particularly those working for larger clients, investing in new machinery or technology, or working on ways to reduce their energy bills, green thinking is increasingly making sense.

New business opportunity?
With the UN Climate Change Conference in Paris beginning in late November, it’s worth noting that businesses of all shapes and sizes are already changing the way they operate – the green entrepreneur is emerging.

Cost advantages

Among them is Andrew Ling, CEO of Perpetual V2G Systems, which works with a range of corporate clients with large vehicle fleets. His business has developed a battery management system designed for delivery vehicles with refrigerators on board. Typically, these vehicles need to keep the engines running even when stationary to supply power to the coolers. However, Perpetual’s system allows the vehicle to be switched off, saving fuel and lowering emissions.

The company’s customers include major supermarkets with large fleets of home delivery vans, but Ling says demand for his company’s services is driven by more than just a desire to cut emissions.

‘We’ve found certain parts of corporations are pushing for carbon reductions, such as sustainability or corporate social responsibility teams. But on the flip side, fleet managers are focused on keeping vehicles on the road and costs down,’ he says. ‘I personally don’t think CO2 reduction as a service is enough, especially within the long-established transport sector.’

Investor attitudes are changing

Dr Mike Pitts works for government agency Innovate UK, which provides match-funded grants to innovative companies. He’s worked with many green technology entrepreneurs and says there has been a shift in attitude towards them from investors and the wider business community.

According to Pitts, this has been driven by the growing belief that fossil fuels don’t have a long-term future and are only likely to become more expensive. ‘It is getting less efficient to use fossil fuels and the public is demanding change too – it is definitely getting more mainstream,’ he says. ‘People are looking to green entrepreneurs to develop new solutions, and it isn’t just about the cost of energy, but also because of wider societal and environmental factors too.’

Pricing problems

Pitts also points out that rising energy prices are a cause for concern for businesses, as consumers may be unwilling to pay more for the same. ‘The long-term trend for energy prices is for them to go up, even if it doesn’t look like that right now,’ he explains. ‘It’s a challenge for businesses: when resources are becoming more expensive, how do they keep their offerings affordable for consumers?’

So this is, perhaps, where the business world is prior to the Paris climate talks in 2015. Businesses want to clean their operations and they’re interested in the new ideas and technologies proposed by entrepreneurs that can help them to do so. But much of this is in response to rising energy bills, and as a result of public and political pressure on them to behave more responsibly. The green entrepreneur is coming to the fore, but he (or she) isn’t all the way there yet.

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