Energy Cuts Growing in Importance at US Companies

No official studies today, but I do have some anecdotal evidence that energy saving measures, once a non-issue with corporations in the United States, are becoming de rigeur for cost-conscious companies. And in the recession, the number of firms that qualify as cost-conscious — even cost-obsessed — is growing by the day.

The evidence is Kohlberg Kravis & Roberts, one of the world’s largest private equity funds, trumpeting that it saved $16.4 million between three companies by making them more “environmentally-friendly”. Of course, that’s a buzz word, and it certainly didn’t mean asking employees at the companies, U.S. Foodservice, Primedia and Sealy, to spend weekends planting trees or flush the toilets less. The money was primarily saved through using less fuel and raw materials.

KKR and its partner, the Environmental Defense Fund, will now apply the methods at four more companies. But KKR obviously has a greater interest than other folks in making small improvements to the bottom line; in a way, that’s its claim to fame. The question is, how many other firms and corporations are also enacting permanent energy cuts?

It may just be a certain class of companies. Alcoa, for example, an aluminum company, is bragging about a 36 percent reduction in greenhouse gas emissions in 2008. But making aluminum is one of the most energy-intensive processes in the world, so a companies in that industry should need little motivation to cut its usage. Along the same lines is the chemical giant DuPont, which used a different metric to talk its efforts up, saying last year that it had saved 2.7 trillion BTUs of energy.

Separately, some forward-thinking companies are also leading the effort. In a report by environmentalist group Ceres, IT company IBM got top honors for its climate change initiatives, along with some other tech firms like Applied Materials and Intel. Apparently, the more brainy the company, the more likely it is to pay attention to energy and/or the climate (although the geekiest, Apple, got low grades).

But the tide seems to be turning, and more companies are taking notice; KKR is just one small example. The recession has cut energy demand, for electricity, liquid fuels and other sources. Could it be that when it’s all over, demand doesn’t rebound to pre-recession levels? If the trend keeps on, it might not.