Oil and gas, utilities put cash behind sustainability

June 18, 2013 | By Barbara Vergetis Lundin

U.S. spending on energy, environment and sustainability initiatives by large corporations will grow at just 5 percent annually until 2017, according to research from independent analyst firm Verdantix, from $34.6 billion in 2012 to $43.6 billion in 2017.

"Large corporations in the U.S. have no financial incentive to increase their investment in energy and sustainability beyond annual increases of 5 percent," said Patty Satkiewicz, Verdantix analyst and author of the report. "Policy on renewable energy, energy efficiency, GHG reporting and environmental compliance will not change. And low natural gas prices will keep downward pressure on electricity prices during the forecast period. CFO interest in energy management will not see an uptick."

In 2013 the oil and gas, utilities and retail sectors will account for 42 percent of total spending ($15.4 billion) by U.S. corporations on energy, environmental and sustainability initiatives. Energy management is the largest category of spending with companies outlaying $13.9 billion in 2013.

Compound annual growth rates for virtually all other industries are expected to remain trapped at 4 to 5 percent from 2012-2017.

"CEOs love to talk about their commitments to sustainability, environmental protection and energy efficiency, but press releases are not followed up with extra cash commitments" commented David Metcalfe, Verdantix CEO. "Weather impacts in 2012 like Hurricane Sandy and the drought in the mid-West were wake up calls without being cash calls. For spending growth to reach double-digits the US economy would need to expand at more than 4 percent per annum, Congress would need to pass new regulations on energy efficiency and environmental compliance, and corporations would need to compete more intensively on sustainability innovation."

For more:
- see this report

http://www.fierceenergy.com/story/oil-and-gas-utilities-put-cash-behind-sustainability/2013-06-18