Tuesday, October 23, 2007

Corporate Energy Strategy from the U.S. Environmental Protection Agency

Industrial energy management literature has become a veritable smorgasbord of technical how-to reference material (see the U.S. Department of Energy's BestPractices). This body of work will satisfy technical minds, but it is of little interest to corporate decision-makers who busy themselves with strategy, vision, and stakeholder communications.

Is energy not a strategic issue? The U.S. EPA thinks it is. "Energy Strategy for the Road Ahead: Scenario Thinking for Corporate Executives and Corporate Boards" was released this year to fill a chronic void. This concise, 36 page (easy reading) document identifies strategic business risks and responses to energy challenges both today and tomorrow. With this document as a platform, corporate leaders have some guidelines for addressing energy issues in strategic terms.

At the heart of this document are four scenarios for the future of industrial energy consumption. Any MBA will tell you that scenarios are wonderful planning tools for identifying challenges and lining up resources in response. A group of 20 commercial and industrial executives collaborated to develop the energy scenarios for this publication. Their vision includes:

(1) The Same Road: how to prepare for a world in which the business sector's level of concern for energy and the environment stays pretty much as it is today.

(2) The Long Road: where the future balance of economic, political, and energy dominance as we know it today becomes radically different. Industry undergoes a reactive transition to this rebalancing and sustains painful changes along the way.

(3) The Broken Road: a scenario where catastrophic political and/or market shocks finally inspire energy-smart (albeit belated) choices by industry.

(4) The Fast Road: this describes the challenges and opportunities that arise when pursuing a proactive political and economic fast-track toward global energy and environmental optimization.

This document is a must-read for any organization that aspires to having a useful energy risk-management strategy. While you're there, be sure to check out the extensive corporate energy management guidelines that the U.S. EPA has produced throughout this decade.

Betsy-- sorry it took me so long to get this one posted.



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