Who can benefit from access to energy data in your company?

Sustainability can no longer be ignored in today’s corporate world. Many companies and organizations are beginning to take forward-thinking steps to reduce their environmental impacts and disclose information through sustainability reports to gain a competitive advantage and maintain their license to operate. However, many are realizing that creating a sustainability report can be a daunting task, as collecting disparate waste, energy, and water data can be very difficult.

Urjanet aligned an expert panel to discuss best practices for acquiring data and organizing it in a sustainability factbook. This panel dives deeply into the main drivers of sustainability reporting and elaborates on new sustainability reporting trends and initiatives.

THE PANEL:

Francis Quinn Director of Sustainability Technologies

Alisdair McDougall Industry Research Analyst

Chris Happ CEO

Jerome Montrone Senior Vice President

Erik Becker Vice President

RESOURCES

EXPERT Q&A:

IMPROVE SUSTAINABILITY PERFORMANCE WITH BIG ENERGY DATA

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For more information, please refer to the webinar replay, “Big Energy Data & The Sustainability Factbook.”

What is driving the increased attention on sustainability reporting and information?

VERDANTIX: One factor is that the government and stock exchanges are really ramping up the rules and regulations around sustainability disclosure. Firms are experiencing increasing pressure to report, creating challenges for those who have yet to consider how to begin to develop a sustainability strategy and how to acquire the information they need. When governments and stock exchanges add requirements for more information, organizations such as the Global Reporting Initiative, SASB, and the IIRC develop frameworks to help firms report on non-financial data.

Additionally, there are risks involved with weak non-financial reporting. Lenders may refuse to provide loans because of a lack of sustainability governance. This will impact top-line growth in corporate balance sheets. Also, exceeding greenhouse gas emissions limits as a result of failing to keep track of the data can lead to fines, penalities, and a damaged reputation.

Many focus on sustainability reporting and communication to avoid falling behind competitors. A company’s insufficient reporting puts a message out to the market that it lacks innovation and risk management. This plays into the minds of not only the investors, but also other important stakesholders such as employees and customers.

WORKIVA: Sustainability is a new and advanced approach to assess the vitality of companies. It’s becoming increasingly relevant on a global scale for the in-depth evaluation of investment and development opportunities. Sustainability, in fact, is of paramount importance because investors, faced with the uncertain evolution of the global financial crisis, are now looking to evaluate not only the short-term financial performance of companies, but also their real viability. In other words, their ability to face new challenges and manage risks generated by our fast-changing world.

You all know what these risks are. You all know where the new opportunities lie. I ask you, what company, in what sector, is not concerned by at least one of the following topics: climate change, deforestation, wealth distribution, population growth, diminishing fossil fuel sources, and water

scarcity? These are topics that touch every company in some way, either as a risk or as a potential opportunity to grow business.

So, the rationality behind sustainability creates a new paradigm for business reporting in the 21st century, with direct consequences to how business viability and growth potential are evaluated.

Why are sustainability leaders so focused on energy even though they have many other priorities?

VERDANTIX: Sustainability leaders have so many things on their plate, and so many important topics with which to be concerned. So why energy? The beauty of energy management is the fact that it has that cost item associated with it. Each kilowatt-hour of energy you save goes directly to your business.Again, if you look at firms maybe in the grocery retail sector that are making five or six percent profit margins, one dollar in savings is quite good when you look at the sales required to generate that profit. Once you start talking about $1 million, $10 million, $20 million, $100 million of savings, and you think about that in terms of the revenue required, you’re suddenly getting into some very big numbers. This helps sustainability leaders gain interest from the executive team, which begins to appreciate it a little bit more. That’s where we really see energy management as a good gateway for sustainability leaders to show that sustainability does actually impact the performance of an organization. For these reasons, sustainability leaders try to make sure that energy issues are addressed first and foremost.

What does Big Energy Data specifically include? Can you deliver water usage data?

URJANET: In the case of billing data, there’s actually a lot of information on the utility bill. There are 125 or 150 data elements on a single utility bill, and all

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“The beauty of energy management is the fact that it has that cost item associated with it. Each kilowatt-hour of energy you save goes directly to your business. “

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of them are provided in our feed, along with a copy of the bill image itself. This information is typically produced monthly.

Now, when you start to look at meter data, you’re talking about information that is several orders of magnitude larger because these observations are coming out sometimes in 15-minute increments. When it comes to meter data, there are massive amounts of usage and demand data. In relation to your question about water, yes. The Urjanet service includes electric, gas, water, and sewer data.

Is it necessary for small companies to follow the Global Reporting Initiative (GRI) guidelines?

VERDANTIX: A lot of the research around sustainability reporting does show that it’s the larger firms that are taking the leaps and bounds in sustainability reporting. I would ask the question: is it necessary for a small company to have a Human Resources policy? Or a policy around recruitment and equality? It’s the same when it comes to sustainability. If it’s something that your organization values, it’s something you should work to do. Again, it doesn’t need to be a full-blown GRI report, but it needs to capture the information that is important to your organization so that it can be shared.

One of the reasons that small firms potentially wouldn’t choose to do a full GRI report is that it requires a fairly big time commitment. Again, options offered by Workiva and Urjanet are really starting to automate that process, reducing the time commitment, and allowing smaller firms to access information that they can share with their customers. Small companies are beginning to do more analysis with this information to see whether there are any efficiencies they can improve through their energy or other sustainability practices.

Although it’s not necessary to do a full, flashy GRI or integrated report, there’s certainly value that can be found in related data and that data should always be shared with your customers and your stakeholders. When you’ve got that information, you should share the progress you are making.

WORKIVA: When I was the Chief Sustainability Officer at L’Oreal, it was obligatory for companies that wished to have preferred supplier status to have a sustainability report. We didn’t necessarily look for

a full GRI report, but we did look for companies that were willing to sit down with us and talk about what they had reported on, why they had chosen their particular indicators, and where they were going. Sharing your story with people in your value chain could help keep your company name on the list of preferred suppliers. It’s definitely something worth thinking about, especially for small or medium-sized enterprises.

Do cost savings and energy management tie back into stock value?

VERDANTIX: We definitely see that they do. Nobody is investing in energy management just for the sake of doing so. We’re truly seeing that non-tangible assets are playing more and more of a role in determining the value of a company. When we see firms such as DuPont, which claims to have avoided $6 billion in energy costs since 1990, we can validate the positive impact of energy management. When we talk about energy management, we are talking about energy efficiency, reducing costs, improving profitability, and improving opportunities around pricing to remain competitive in the market. Essentially, you’re competing against firms that are coming from regions such as India, China, and Brazil, which may be facing higher manufacturing costs. We definitely see that the firms that have strong sustainability and energy management strategies really are setting themselves up for the future, and not just in their stakeholders’ perceptions of them in the stock market.

WORKIVA: The value of companies is increasingly being measured in terms of their intangible assets. Intangible assets are primarily composed of intellectual capital and relationships with stakeholders. So, your company must be thinking about questions such as, “How good is our reputation?”, “How much goodwill or trust do our operations generate amongst our stakeholders?”, “How well do we understand and manage new risks and opportunities?”, “Can we innovate?”, and “Are our products and services safe and ethical?”. These have all become really important questions for determining market value.

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What are the best sustainability metrics to track?

BEACON CAPITAL: I would recommend tracking as many as you can, especially those related to LEED points. We assess the building environment for our tenants, cost savings, and the building’s environmental impact. Therefore, we use economic data, energy data, indoor environmental air quality data, and more.

GOBY: I would say the key sustainability metrics most people want to track are energy, water, and waste. They are looking at what goes into and out of a building and how much power it uses. These factors are the basis for the carbon footprint calculation.

Has the Cox Enterprises energy program, which is geared towards sustainability, been validated by a third party? If so, what was the verified energy performance improvement over the past twelve months?

URJANET: Yes, in fact, Cox Enterprises did have third parties come in to validate aspects of their program. I’m not sure which organization they used for the third party validation, but they can probably cite some of the specific figures around what their gains have been in energy efficiency. I do know that they’re saving around 10-15% in energy spend in certain deregulated markets, and that they’ve seen similar improvements, especially in their Manheim Auto locations.

I know that Workiva has cloud-based applications for financial, managerial, and sustainability reporting. Is the Workiva Wdesk factbook standard or can it be customized?

WORKIVA: The factbook is customized for each customer for the simple reason that no two companies are the same, so they collect data in different ways. They also collect data with slightly different processes and report on different indicators. There are several different reporting frameworks that people report with, and there isn’t

complete standardization in what people report on and more particularly how that data is collected. We try to support our customers as much as possible by giving them complete flexibility in how the factbook is structured, and then ultimately in what they wish to report on. The key point of the factbook is not just to handle data that might go into a report like a GRI, CDP, or DGSI, but it’s also to increase the value of all the information that a company might use, both to manage its operations internally and to report externally.

We end up systematically doing customizations for our customers, but for us it’s a pretty straightforward process. The factbook looks and feels like a very, very familiar environment, and that’s done deliberately to help people get onboard, get them accustomed to using it, and ultimately get them to use it as the one source of truth for their data sets.

What are the drawbacks of using something simple, like Microsoft Excel spreadsheets, for sustainability data management?

VERDANTIX: The first one will be the time commitment. The time commitment required to contact all of the individuals from all of your sites who are responsible for keying in all of the information around energy consumption and sustainability is substantial. You have to chase individuals down who haven’t sent you the information you need. With an automated solution, you don’t have to worry about collecting the data from each person. Instead, the data is collected as soon as it becomes available.

The second disadvantage is inaccuracy. We all suffer from fat thumb syndrome and lapses in concentration every now and again. When you’re capturing data manually, a sizeable number of mistakes make their way into the data set. This can be very important when someone like the CEO, CFO, or CSO is starting to make some significant decisions. Automated solutions have checks in place to make sure that all of the information is accurate as it’s going into your systems.

Flexibility can be another challenge. Changing KPIs or how you structure your reporting can be very difficult and labor-intensive with Excel and require you to retrain each individual you are collecting information from. So, due to time restraints, firms

“With an automated solution, you don’t have to worry about collecting the data from each person. “

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end up choosing to capture the bare minimum of data that is needed to satisfy the requirements to date. An automated solution allows you to make centralized changes, updating everything automatically and enabling more timely reporting. You can also capture all of the information, regardless of whether you need it now, to ensure that if you ever need it in the future, there’s a back log of information at the tips of your fingers.

Lastly, when looking at all of the above factors, you see that there is a higher cost associated with using simple data management tools. Some people may disagree, but what I might ask them is how often and how frequently they would like to do sustainability reporting. Would they like it to be more granular? More accurate? Well, I would tell them to imagine how much that would all cost using Microsoft Excel spreadsheets compared to using an automated solution, which streamlines many processes for you.

I would like to find a better way to collect sustainability data for my locations abroad. Is Urjanet Utility Data available outside of North America?

URJANET: Yes. We’ve rolled out to about 1,100 utility providers in North America for electric, gas and water. That represents about 80% of all the utility accounts, and we’re now rolling out in Europe. By the end of 2015, we’ll be in 20 different countries across Europe with plans to enter South America and Asia.

How does a sustainability system enable or facilitate the validation of data, acknowledging that not all human oversight can be automated?

URJANET: In our data collection process, we’ve got about 150 different audits that we run on each piece of data that flows through the system. All of those audits help ensure that the data is accurate. Then, we find applications like the Workiva Wdesk that take the validation of data a step further.

WORKIVA: Although it may be necessary to validate data with some human oversight, our common platform does have automated checks and allows users to quickly identify any errors. In the case of Wdesk, we customize variances for cells where data is entered, and these can

be set to whatever degree of tolerance people wish to help check for anomalies. Plus, we have a full certification validation platform that’s built into Wdesk that allows for a chain of command to subsequently validate the data as it rolls up through the organization. I would say that you get the most improvement in data validation by having something that is intuitive, is easy to use, and takes the drudgery out of collecting, consolidating, and analyzing these data sets.

By simply giving people more time to focus on the analysis of the data they’ve collect instead of just brute data collection, you get better results. When people are less stressed, they have more time to check their data set for accuracy.

Can the Workiva factbook be integrated with other existing energy management and sustainability services, or is it just with Urjanet?

WORKIVA: It can be integrated into other existing systems. I mean, the commonality here is Excel. Once the given system exports into an Excel format, a PDF format, or some sort of a Word document, it can be synchronized into Wdesk, and from Wdesk into the factbook. So, the field there is quite broad.

How hard is it to get good utility data for sustainability purposes, and what’s the process that makes it automated?

URJANET: Well, as it turns out, it’s really hard to get good utility data. It’s such a challenging problem that there are third party companies that have offices set up all around the globe with hundreds of people keying bill data into databases. That’s the problem we’ve really solved with automation. Our customers send us a list of the utility accounts they want to activate on the platform, and then all the manual processes they were undertaking before go away and are replaced with our automated feed.

What is the most significant benefit of an automated data and/or software solution?

VERDANTIX: I really do believe it is having all of

“The value of companies is increasingly being measured in terms of their intangible assets.”

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that information in one central location where you can really have faith that the information is accurate, first and foremost. Then, the ability to really let all of your great employees access that information, allows them to go in and start slicing and dicing the data. The benefits become almost limitless in terms of how you can treat the data, manipulate it, and find new opportunities. An automated system allows teams to have a great foundation to really start making some important decisions, both from a sustainability perspective and from a business perspective. Business performance is at the heart of the benefits of an automated solution. I believe the most significant benefit is empowering individuals to tackle the data and really go out there and find opportunities that make a difference to your organization.

ABOUT URJANET

Urjanet’s mission is to provide the world with easy access to automated energy data. Our cloud-based platform seamlessly extracts and normalizes disparate utility bill and interval data directly from the source, and delivers it into the business systems and products that rely on it. Leading commercial enterprises and energy solutions providers use Urjanet data to gain deeper insight into energy consumption and spend. Urjanet is a privately-held company headquartered in Atlanta, Georgia. For more information, visit www.urjanet.com.