The business case for renewable energy

the business case for renewable energy

At the heart of the climate crisis is energy, but it can also be the key to solving it. Fossil fuels are the largest contributor to worldwide climate change, making up more than 75 percent of greenhouse gas emissions worldwide and almost 90 percent of all carbon dioxide emissions. 

To avoid the worst impacts of climate change, sustainability management is critical, and in the realm of emissions, this means reducing them by nearly half by 2030 and reaching net zero by 2050. Continue reading as we explore renewable energy sources which are available in abundance all around us and how we can end our reliance on fossil fuels. 

What is renewable energy? 

Renewable energy is essentially energy that is derived from natural sources. These natural resources are replenished at a higher rate than they are consumed. Some examples of renewable energy sources include wind and sunlight. 

These sources are continuously being replenished. In essence, renewable energy sources are all around us and plentiful. They differ vastly from the likes of oil, gas, and coal, which are fossil fuels and non-renewable resources. These resources take hundreds of millions of years to create. 

Not only that but when fossil fuels are burned to create energy, they release harmful greenhouse gas emissions like carbon dioxide. With all this in mind, creating renewable energy creates less emissions than burning fossil fuels. Therefore, transitioning from fossil fuels to renewable energy is essential in tackling the climate crisis. 

Common renewable energy sources 

Renewable energy sources come in a variety of forms. Below are some of the most common sources of renewable energy.

Wind energy

This renewable energy source generates kinetic energy from moving air through the use of large wind turbines located in sea or freshwater (offshore) or on land (onshore). Wind energy has been used for many years, but the technology has evolved rapidly in the last number of years to maximise the electricity generated. 

Average wind speeds vary by location, but the world’s technical potential for wind energy exceeds the worldwide electricity production. Many areas in the world have strong wind speeds, however, remote locations are often the best for creating wind power. Offshore wind power, therefore, has a lot of potential. 

Solar energy

Solar is one of the most abundant energy resources, and it is a common misconception that it can only be harnessed in sunny weather. It is intercepted by the Earth at about 10,000 times more than the rate at which humankind consumes energy. 

Solar technologies can deliver cooling, electricity, fuels, natural lighting, and heating. They convert sunlight into electrical energy through mirrors or photovoltaic mirrors, which concentrate solar radiation. While not every country is equally endowed with solar energy, a significant contribution to the energy mix from direct solar energy is possible for each country. 

The cost of manufacturing solar panels has drastically reduced in the past decade, which means they are more affordable and often the cheapest form of electricity. These panels have a lifespan of around 30 years and come in an array of shapes depending on the kind of material utilised during the manufacturing phase.


Hydropower generates energy by transporting water from higher to lower elevations. It can be created from rivers and reservoirs. Run-of-river hydropower plants harness energy from the available flow of the river, while reservoir hydropower plants rely on stored water within a reservoir. 

Hydropower reservoirs generally have several uses, from water for irrigation, flood and drought control, energy supply, navigation services, and drinking water. Hydropower is presently the largest source of renewable energy within the electricity sector. It typically relies on stable rainfall patterns and can be adversely impacted by climate-induced droughts or changes to ecosystems that affect rainfall patterns. 

The infrastructure required to generate hydropower can also affect ecosystems in negative ways. With this in mind, most consider small-scale hydro more environmentally friendly, particularly for communities in remote locations. 

Geothermal energy

Geothermal uses the accessible thermal energy from the Earth’s interior. The heat is extracted from geothermal reservoirs using means such as wells. Reservoirs that are naturally sufficiently permeable and hot are referred to as hydrothermal reservoirs. 

By contrast, sufficiently hot reservoirs enhanced with hydraulic stimulation are referred to as improved geothermal systems. Fluids of various temperatures can be used to create electricity once at the surface. The technology for electricity generation from these reservoirs is reliable and mature. It has been in operation for almost a century. 


Bioenergy is created from a range of organic materials, referred to as biomass. Some of these include dung, charcoal, wood, and other manures for power and heat production and crops for liquid biofuels. 

The majority of biomass is utilised in rural areas for lighting, cooking, and space heating, typically by poorer populations residing in developing countries. 

Ocean energy

Ocean energy is another source of renewable energy. It comes from technologies that utilise the thermal and kinetic energy of seawater. For instance, using currents or waves to create heat or electricity. 

Ocean energy is still at a very early point in development. There have been several prototype tidal and wave current devices explored. However, the theoretical potential for it exceeds the current human energy requirements. 

The business case for switching to renewables

Businesses have compelling reasons to transition to renewable energy, driven by significant economic, environmental, and social benefits. One of the most persuasive factors is cost savings. 

The International Renewable Energy Agency (IRENA) reports that the cost of electricity from solar photovoltaics (PV) has dropped by 82% since 2010, making it one of the cheapest sources of new electricity, alongside onshore wind. 

These reductions in cost have enabled businesses to achieve substantial savings, with the Carbon Trust indicating that switching to renewable energy can lead to a 20-50% reduction in energy costs.

Renewable energy also plays a crucial role in job creation and enhancing energy security. IRENA reports that the renewable energy sector employed over 12 million people globally in 2022.

Diversified energy portfolios, including a higher share of renewables, can improve energy security and reliability by reducing dependency on imported fuels, which is particularly important for business continuity.

The environmental and social benefits are equally compelling. Transitioning to renewable energy could prevent 4-7 million premature deaths annually by reducing air pollution, according to the World Health Organization (WHO)

Additionally, widespread adoption of renewable energy could help avoid up to 75 gigatonnes of CO2 emissions by 2050, significantly contributing to global climate goals. Consumer preferences and corporate commitments further drive the shift towards renewables. 

A survey by Deloitte found that 68% of consumers prefer to buy from environmentally responsible companies, and 59% of businesses are integrating renewable energy as part of their sustainability strategy to meet consumer demand. 

Companies involved in the RE100 initiative report benefits such as increased brand reputation, stakeholder confidence, and market competitiveness due to their renewable energy commitments. 

Success stories – businesses that have made the switch

Businesses that make the switch to renewable energy will experience enhanced brand reputation and reduced operational costs, among other advantages. Below are some success stories of businesses that have taken the leap and reaped the benefits. 


Kohl’s, a major US retailer, has made significant strides towards sustainability. With over 1,000 of its stores equipped with on-site solar panels, Kohl’s has worked towards carbon-neutral operations. This initiative not only helps reduce greenhouse gas emissions but also aligns with their corporate sustainability goals, positioning them as a leader. 


Walmart has been a prominent player in renewable energy adoption, with ambitious goals to be powered entirely by renewable energy. By 2016, Walmart had installed 145 megawatts of solar capacity, making it one of the top corporate solar installers in the US. This initiative has not only helped reduce their carbon footprint but also resulted in cost savings and enhanced their public image.


Apple has committed to using 100% renewable energy for its facilities worldwide. The tech giant’s new campus in Cupertino, California, is powered by one of the largest on-site corporate solar installations globally. Apple’s investment in renewable energy is part of its broader strategy to reduce its ecological footprint and promote environmental sustainability. This commitment has improved Apple’s brand reputation and aligns with consumer expectations for sustainable business practices. 

Group V

Group V, a transportation company, transitioned to renewable energy by converting a significant portion of its fleet to bioethanol trucks and semi-trailers. This move was supported by a green loan from BNP Paribas, which provided favourable terms due to the alignment with the EU Taxonomy for sustainable activities. This transition has helped Group V reduce greenhouse gas emissions and improve operational efficiency, showcasing the financial and environmental benefits of adopting renewable energy. 

Bar One Clothing

Bar One Clothing, a Scottish garment wholesaler, improved its sustainability through the Zero Waste Scotland programme. They secured an interest-free loan to implement energy-efficient measures, including LED lighting and low-voltage distribution boards. These changes not only reduced their energy bills but also cut greenhouse gas emissions by an estimated 9.5 tonnes annually. This initiative highlights the cost savings and environmental benefits of investing in renewable energy and energy efficiency.

Factors that limit the use of renewable energy

Renewable energy has the potential to be a vital solution to the pressing worldwide challenges of energy security and climate change. However, it is important to recognise that some challenges with renewable energy hinder its widespread adoption.

For one thing, renewable energy sources are subject to fluctuation because they depend on weather conditions and perform better at certain times during the day. This intermittency can present challenges to grid stability. In addition, renewable energy costs have reduced significantly in the past number of years, but the initial capital investments are still considerable. 

Moving beyond costs, the transition to clean energy also requires extensive infrastructure development. This would include expanding transmission networks to connect population centres and remote renewable resources. Finally, there is the risk that renewable energy projects would face some opposition due to concerns surrounding noise or visual impacts. 


Renewable energy sources are not just good for the planet but have a host of other benefits such as improved health, affordable, democratic, and possessing the potential to create jobs. According to the Center for Climate and Energy Solutions, renewables made up 29 percent of electricity generation in 2020, and much of this came from hydropower. In 2023, this figure increased to 30 percent. Although this represents we still have a long way to go, it also signifies the good news that there is a growing appetite for renewables. 

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