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Tag: energy efficiency

  • Krieger: AI has arrived for Long Island’s development community | Long Island Business News

    In Brief:
    • AI enhances smart buildings by predicting occupancy and environmental needs for improved comfort and efficiency.
    • HVAC systems use AI to optimize energy consumption, processing real-time data on temperature, humidity, and weather.
    • AI monitors equipment and lighting, detecting issues early and adjusting usage for cost savings.
    • Construction design benefits as AI integrates data to improve planning, schedules, and overall productivity.

    More than 25 years ago, the Long Island development community was hailing the introduction of what was described as “the smart building.” One could program a system to say: “If ambient temperature exceeds 72 degrees Fahrenheit, turn on the air conditioning” or “turn off the lights at 6 p.m.”  It was thought to be revolutionary in controlling costs, providing for tenant or visitor comfort, and monitoring energy consumption.

    If that was a “smart building” in the year 2000, hold onto your hats in 2026.

    AI is taking the smart building and giving it a doctorate.

    Far from the monitoring devices that were reactive in a smart building, AI is creating a learning curve that can predict needs, respond accordingly and then provide a level of efficiency that was unimaginable just several short years ago. It’s akin to comparing a programmable thermostat to a system that now understands the thermal dynamics of your entire building and anticipates your needs before you are even aware of them.

    The most significant impact of AI will likely be in the area of heating, ventilation and air conditioning, which typically consume 40% to 50% of a building’s energy. Today’s AI systems are beginning to process data from sensors integrated into the design before the foundation is poured. These sensors will send real-time information to AI regarding temperature, humidity, occupancy and even outdoor weather conditions.

    AI will then predict patterns based on occupancy data, anticipating when spaces will be used, and then direct the HVAC system to achieve maximum efficiency while protecting comfort levels. Its learning algorithms will continue to refine its response, adapting to changing weather and whether the space was actually used as AI initially predicted.

    But that is not AI’s only use. Building owners know that traditional maintenance follows fixed schedules. The problem with this management tactic is that equipment could be replaced prematurely or, worse, the schedule misses the early warning signs of pending failure. AI systems will continuously monitor equipment performance. It is capable of detecting even subtle warning signs such as electric motors that seem a little “off,” fluctuations in electrical systems, or unexpected plumbing pressures. It is akin to having an all-knowing custodian with superpowers who is working 24/7.

    Lighting systems will also be integrated with AI going far beyond the occupancy sensors that currently turn lights on and off when they recognize motion in a room. AI is now capable of reviewing space utilization data so that it understands how different areas are used throughout the day and provide light accordingly. That means a reduction in energy costs.

    B2K Construction, and its president Jon Weiss, will spend many hours working on construction designs that will eventually become steel and concrete. AI systems have become an associate that can take what appears to be unconnected disciplines and create a holistic approach to building design and construction schedules. In the year to come it will not only demonstrate the ability to accumulate more information but to learn from that data and then offer solutions that create efficiencies and improve productivity at the construction site.

    We are looking at an era when computing power is expected to become cheaper while AI becomes more sophisticated.

    For developers welcoming in 2026, AI is offering an essential tool for design, construction and function that is ensuring smart buildings will now come with an advanced diploma.

     

    Steven Krieger is CEO of B2K Development in Jericho, whose family of companies includes B2K Construction.


    Opinion

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  • How Small Businesses Can Break Free From the ‘Efficiency Trap’ | Entrepreneur

    Opinions expressed by Entrepreneur contributors are their own.

    After decades of working with small businesses, I’ve witnessed a troubling pattern: the harder entrepreneurs try to maximize efficiency, the less efficient they become. This efficiency paradox plagues businesses of all sizes, but it’s devastating for small companies where every resource counts.

    McKinsey research shows that small and medium businesses operate at 50% of the productivity of large firms — a gap that stems from misguided efficiency efforts. Understanding and resolving this paradox can transform how you operate.

    The two types of efficiency

    Here’s a concept from the Lean methodology that changed how I think about business operations. There are two approaches to efficiency: resource efficiency and flow efficiency.

    Resource efficiency focuses on maximizing the utilization of your resources. You build a queue of work to ensure your resources are busy. It’s like having a writer with articles to write, ensuring they’re productive for all eight hours of their workday.

    Flow efficiency optimizes for speed through your system. Instead of building queues, you focus on moving work through your process quickly. Using the writing example, you’d interview someone, have the writer create the article, review it and publish — no waiting, no queues.

    The healthcare system provides a stark illustration of this. In Canada, we optimize for resource efficiency. Specialists are fully booked, CT machines run at maximum capacity and patients wait months for diagnoses. I’ve seen cancer treatment systems operate differently — where patients can see specialists, get scans and receive diagnoses in one day. Their CT machines sit idle sometimes, but patients get answers immediately.

    Here’s the paradox: by trying to maximize resource utilization, we create inefficiencies that slow down our operation. You think you’re being efficient by keeping everyone busy, but your customers are waiting months for what could be done in days. The side effects can be devastating: lost customers, damaged relationships, missed opportunities and consequences that are incalculable.

    Related: 6 Ways to Make Your Business More Efficient

    The hidden cost of context switching

    This efficiency paradox doesn’t just happen at the system level — it shows up in how we structure our work. When we try to maximize resource utilization, we create what I call “efficiency theater” — looking busy while being less productive.

    Consider the hidden cost of context switching. According to research, context switching reduces productivity up to 40%. There’s a mental tax every time you switch between tasks. If you make 50 context switches in a day, you’ve paid that tax 50 times. But if you can organize your day to switch only five times, you’ve reduced that waste.

    This connects directly to those two types of efficiency, revealing the paradox. Resource efficiency minimizes context switching — you batch similar work and stay in your zone. Flow efficiency increases context switching when one person handles multiple steps in the process.

    Despite the context-switching penalty, flow efficiency delivers better results by eliminating other wastes: delays, queues and work sitting idle. The goal isn’t choosing between resource or flow efficiency; it’s identifying and eliminating whatever is hurting your business most. Sometimes that’s context switching. Sometimes it’s customer wait times. The art is knowing which matters more.

    This connects to what Paul Graham wrote in his essay on maker versus manager schedules. When you’re in maker mode, you need long, uninterrupted blocks of time. In manager mode, you’re switching contexts constantly. Most small business owners try to do both simultaneously, creating massive inefficiency.

    I’ve learned this the hard way. When I try to write code in the morning, handle customer calls at lunch, review financial reports in the afternoon and then jump back to coding, I accomplish far less than if I dedicated entire days to specific types of work.

    Identifying waste in your systems

    Understanding this paradox helps you spot waste in your systems. Ask yourself: Why is this taking so long? What unnecessary steps have we added?

    I discovered a major inefficiency in our software development process around branching. We were using long-running branches, working on it for weeks, then trying to merge everything back together. The longer these branches ran, the more problems we encountered. We were trying to be efficient by letting developers work uninterrupted, but we were creating waste.

    The solution was simple: shorter running branches with uncompleted features hidden by feature flags. Now, if a branch needs to run longer, we require daily rebasing. This policy change eliminated hours of integration headaches and reduced our bug count. It transformed our development from resource-efficient to flow-efficient.

    Related: Don’t Waste Money on Unnecessary Spending — Here’s How.

    Balancing improvement with stability

    Some business owners resist change, citing “if it’s not broken, don’t fix it.” This mindset can leave you vulnerable to competition. The key is adopting a continuous improvement mentality — not because something is broken, but to stay ahead.

    Think about computer processors. Intel doesn’t wait for its chips to fail before developing faster ones. They know competitors are innovating, so they must too. When Intel failed to keep pace with this philosophy — falling behind competitors like Apple’s M-series chips — we’re watching a once-dominant company struggle for relevance. The same applies to your business processes.

    However, you need the right people. Some team members thrive on improvement and change, while others prefer stability. Both have their place, but in competitive industries, you need people comfortable with evolution.

    The cost of partial work

    Another source of waste is unfinished work. Starting something and not completing it before moving to the next shiny object creates partial work waste. Unless you’re experimenting or researching, unfinished work represents time invested with no return.

    The efficiency paradox teaches us more isn’t always better. The most efficient path involves letting resources sit idle to maintain flow. Sometimes it means saying no to new initiatives to complete existing ones. It means being intentional about how you work.

    Start by examining your operations. Where are you optimizing for busy-ness instead of throughput? Where has context switching become a hidden tax on your productivity? How can you batch similar work together to improve flow?

    Efficiency isn’t about keeping everyone busy — it’s about delivering value quickly and consistently. Once you understand this paradox, you can build systems that serve your business and customers.

    Alykhan Jetha

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  • Groundswell and Local Leaders Announce $20 Million Investment in Local Energy Resilience Program


    LANETT, Ala., February 21, 2025 (Newswire.com)
    –
    A new $20 million regional initiative announced today will bring critical home repairs, energy efficiency upgrades, and community resilience projects to more than 500 households across Alabama and West Georgia. Funded by the U.S. Environmental Protection Agency’s (EPA) Community Change Grant, this groundbreaking investment will reduce household energy bills by hundreds of dollars a year, strengthen local infrastructure, and establish 10 community resilience centers to protect residents during extreme weather events – creating lasting economic and environmental benefits across multiple counties.

    Building a resilient community requires collaboration and investment, and this new $20 million initiative is bringing together local officials, municipal partners, and community business owners across Georgia and Alabama to make it happen. With a focus on energy efficiency, community resilience, and empowerment, the effort will create conditions for long-term economic development in Alabama and West Georgia

    The SOUL™ (Save On Utilities Long term) program will provide home safety and energy efficiency upgrades over the next three years, helping households lower electricity bill costs and strengthening resilience against extreme weather. SOUL helps reduce utility bills by enhancing home energy efficiency, focusing on senior citizens and hardworking families facing high energy costs.

    Through this initiative, 500 households will benefit from such energy efficiency upgrades as improved insulation and lighting, as well as vital home repairs including heating and air conditioning system upgrades, roof repairs, and the replacement of aging appliances-all through Groundswell‘s SOUL program. This funding will direct over $11 million into home improvements-reducing average annual energy burdens by 30% to 65%, improving indoor air quality, and increasing the overall health and safety of homes.

    The grant will serve five counties in Alabama and one in West Georgia. The investment will support the development of community resilience hubs. These hubs will offer vital resources during extreme weather events while serving as long-term centers of stability and connection. Additionally, they will help local host institutions save on energy costs-an estimated $6,000 per year per building, or more than $100,000 over the hub’s lifespan-allowing those savings to be reinvested into serving the community even more effectively.

    “This funding isn’t just about improving homes, it’s about building community power,” said Michelle Moore, CEO of Groundswell. “Groundswell’s initiatives are designed to ensure that our work delivers savings while also strengthening resilience and opportunity for all. By reducing energy burdens, strengthening local infrastructure, and investing in workforce development, we’re creating lasting, sustainable clean energy solutions that directly benefit families across Georgia and Alabama.”

    The work will also support economic development-creating new opportunities for small businesses and enhancing workforce development opportunities.

    “Our community is full of hardworking people who deserve homes that are safe, efficient, and affordable to keep running,” said City of Lanett Mayor Jamie Heard. “This grant gives us the chance to make sure folks aren’t struggling to heat their homes in the winter or cool them in the summer. Investing in our residents and their homes means investing in our local workforce, and that’s a win for everyone.”

    Source: Groundswell

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  • Pearl Certification to Incorporate New National Definition of a Zero-Emissions Building in Its Certification Standards

    Pearl Certification to Incorporate New National Definition of a Zero-Emissions Building in Its Certification Standards

    A leader in home-energy efficiency certification, Pearl will incorporate the U.S. Department of Energy’s Zero-Emissions Definition into its Certification standards. Pearl is now working with homeowners to help them achieve and be recognized for meeting this ambitious goal.


    CHARLOTTESVILLE, Va., June 6, 2024 (Newswire.com)
    –
    Pearl Certification is proud to announce our support of the new National Definition of a Zero Emissions Building put forward today by the U.S. Department of Energy, the Biden administration, and federal agencies. As a national leader in energy-efficient certification for homes and home features, Pearl looks to drive public awareness and interest in zero-emissions buildings by incorporating the new definition into a forthcoming Pearl Certification standard. 

    “We look forward to working with the Department of Energy and the White House on leading national adoption of this important definition,” said Robin LeBaron, president and co-founder of Pearl Certification. “To advance decarbonization and electrification, the White House has set ambitious criteria, and we will leverage the definition in our own zero-emissions standard within the Pearl Certification system.” 

    The newly established definition identifies a zero-emissions building as one that is:

    • Highly energy efficient
    • Free of on-site emissions from energy use (all electric)
    • Powered solely by clean energy

    “We support this definition because it’s practical and removes ambiguity about how zero emissions are defined,” said LeBaron. “We’re also pleased that the definition makes it possible for low-income homeowners to achieve zero-emissions status.”

    Using the national definition, Pearl has already identified several zero-emission and ‘nearly zero’ homes in its network of 200,000+ certified homes. One of those homes belongs to Scottie and April Chambers, young professionals and new parents living in an energy-efficient home in Charlottesville, Virginia. Their home, purchased from the Thomas Jefferson Community Land Trust and certified by Pearl, is all-electric, and the addition of a solar photovoltaic system has brought them close to zero emissions. 

    “Our home’s energy efficiency features and solar system keep our utility bills surprisingly low,” said Chambers. “And after learning about the new zero-emissions definition and consulting with Pearl Certification’s staff, we’re considering switching to a clean power plan offered by our local utility company to ensure that our energy is sourced from renewable resources and fully meets the zero-emissions definition.”

    The home’s Pearl Certification documents its energy-efficient and renewable systems so that buyers, agents, and appraisers can recognize and value it properly at time of sale. The report is part of Pearl’s mission to generate demand for energy-efficient (and zero-emissions) homes by increasing home value.

    As with all energy-efficiency initiatives, education and tools will be essential in driving awareness of the benefits of a zero-emissions home.

    “We know there are more homes like Scottie’s and April’s out there,” said LeBaron. “And many more who are close. With the Zero Emissions criteria incorporated in the Pearl Certification Standards, plus access to educational, planning, and savings tools, like our homeowner app Green Door, we can help them get to zero. Americans earning a zero-emissions certification should be able to see a return on this investment in their home — and their planet.”

    About Pearl Certification

    Pearl Certification is the gold standard in high-performing home certifications, bringing visibility to the valuable features that make them healthy, safe, comfortable, and energy- and water-efficient. Pearl is the only national sponsor of the U.S. Department of Energy’s Home Performance with ENERGY STAR® program and partners with the National Association of REALTORS® Green Resource Council. Pearl has certified over 200,000 homes in 49 states and Washington, D.C. On average, Pearl Certified homes sell for 5% more than comparable homes, according to independent appraiser studies. For more information on how Pearl Certification drives demand for energy-efficiency homes, visit www.pearlcertification.com and register.greendoor.app.

    Source: Pearl Certification

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  • Stumped by Heat Pumps?

    Stumped by Heat Pumps?

    Now stretch it really hard and quickly hold it to your upper lip, which is sensitive to temperature. You will feel that it’s warmer than it was before. That’s because you’re adding energy to the rubber band, which increases its temperature.

    Are you ready for the awesome part? Keep it stretched for a little while until it returns to room temperature. Now let the rubber band relax and quickly touch it to your lip again. It’s now colder than room temperature! Seriously, try this for yourself.

    So if you had a big enough rubber band, could you use this to cool your house? Wait a minute, you’re gonna say: In the first stage, when we stretched the rubber band, it got hot, and then it cooled back to its original temperature—and in doing that it heated the air. You’re right. But what if we could vent that warmer air outside? Then you could keep just the cooling phase inside.

    Boom. You just re-invented the air conditioner! Instead of a rubber band, an AC has a fluid called a refrigerant that circulates in a closed loop from inside to outside. This fluid has a low specific heat, so it changes temperature quickly, and a very low boiling point—turning into a gas at something like –15 Fahrenheit.

    How’s it work? The gas is first compressed, causing it to heat up to like 150 degrees. The hot gas circulates in a set of copper coils outside, with a fan blowing over them, so the gas loses thermal energy to the atmosphere. (Copper also has a low specific heat.)

    Then it’s pumped back inside, where the pressure is quickly reduced, causing it to expand and instantly cool down to around 40 degrees. As the now cold fluid circulates through indoor coils, a fan blows warm inside air over it, heating the fluid again and cooling the indoor air in the process. As the system circulates, it basically picks up thermal energy indoors and carries it outdoors.

    By the way, this is exactly the same process that your fridge uses to keep your cheese and soda cold. In both cases, the process makes something inside cooler and something outside warmer. Put your hand behind the fridge and you’ll see what I mean. Just for kicks, here’s a guy who actually built a refrigerator that runs on rubber bands.

    So Heat Pumps Aren’t New!

    You thought this was going to be an article about heat pumps, right? Well guess what. We’ve been talking about heat pumps this whole time, because they run on the same principles. A heat pump cools your home just like an air conditioner, by circulating a refrigerant and varying the pressure to change its temperature, so it takes thermal energy from one place and puts it in a different place.

    So back to the big mystery: How can a heat pump increase the temperature of indoor air on a cold day without actually generating any heat? Simple: Just run it in reverse! This time we let the hot compressed refrigerant cool off inside the house to raise the indoor air temperature. The low-pressure, cold gas then goes outside to warm up.

    Warm up outside? Yep. Even on a freezing day, the air still has thermal energy. So long as it’s above absolute zero—which, believe me, it is, since that’s around –460 Fahrenheit—the air molecules are in motion. And since we’re cooling the refrigerant to, say, –15 degrees, which is lower than winter temperatures in most places, it will wring thermal energy out of even frigid air.

    Of course, you can’t get energy for free. Heat pumps rely on electricity to drive the compressor and fans. But if you have solar panels at home, or if the electricity in your area is even partly from non-carbon sources, replacing a gas furnace with a heat pump can make a big difference in reducing greenhouse gas emissions. And it’ll probably lower your utility bills in the process.

    Rhett Allain

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  • 8 Trends to Watch Out for In Grid Energy | Entrepreneur

    8 Trends to Watch Out for In Grid Energy | Entrepreneur


    Opinions expressed by Entrepreneur contributors are their own.

    For many, the future of energy seems so close yet too far away. That image is coming into view but is still blurry and distant for many. As a clean grid energy expert, the future is now. These technologies exist, and they’re getting better every day. They will define what the energy grid and the homes and businesses of the next 50 to 100 years it supports will look like.

    For over 20 years, I’ve been working and leading in the energy-saving and home improvement industry. I’ve been learning and using my years of experience to educate people about green living for years. More recently, I’ve been working on the prototype for the home of the future in Denver, CO. Here are some of the energy trends and innovations I see as promising for energy-efficient homes of today and tomorrow.

    1. Grid analytics

    Grids can now collect obscene amounts of data on how energy is used. It can track connected asset performance and identify equipment issues. It can identify trends associated with the time of year and weather patterns through predictive analytics to manage energy production, storage and distribution effectively.

    Related: 5 Renewable Energy Sources To Look Out For in 2024 and Beyond

    2. Grid AI

    Artificial intelligence can use machine learning to adapt automatically to trends. Imagine a grid that ramps energy production up and down ideally to reduce wasted resources, driving energy efficiency up and, over time, the cost to manage energy down.

    In the shorter term, grid AI switches between renewable and non-renewable energy sources. In the future, it can shift among renewable to reach the most eco-friendly and cost-effective mix based on environmental or other factors.

    3. Remote microgrids

    Microgrids deliver hyper-local energy to rural locations. Rather than depending on a more extensive energy grid infrastructure with so many ways to fail between the grid and place, a microgrid produces and stores the energy where it’s needed, using whichever renewables are most available.

    4. Suburban and urban microgrids

    Today, many microgrids are treated as backup systems for essential services like hospitals, critical data centers, or disaster relief command posts. But as the technology advances, we’ll see many more communities using microgrids for everyday applications and even in more urban areas.

    This would mean localizing power to “keep the lights on” while staying connected to (but able to disconnect from) a larger grid. With the concern over the potential for strategic attacks on energy grids, decentralizing the grids is a promising solution.

    Related: 6 Tips to Invest in Renewable Energy Now

    5. EV-supportive grid management

    Fossil fuel usage continues to be one of the biggest environmental threats. Electric vehicles can reduce our dependence. But problems exist. Charging thousands of EVs taxes older energy grids and makes owning an EV cost-prohibitive for the average family.

    Green energy grids can and are working with EV owners to solve these problems. Vehicle to Grid (V2G) technology allows EVs to return power to the grid when needed without inconveniencing the car owner. Furthermore, it starts charging the vehicle when demand drops, helping the grid balance more efficiently and preventing blackouts. Whether energy companies reduce rates during non-peak hours or provide specific discount incentives for EV owners using this technology, this system can significantly reduce EV ownership costs.

    6. Grid cybersecurity

    As mentioned, centralized grids are increasingly at risk. While physical attacks are possible, cyber-attacks are much more likely. So, it’s no surprise that grids get a makeover with tools like data encryptions, anomaly monitoring, and faster threat detection and response.

    Related: Here’s Why Solar Entrepreneurs Don’t Go Off the Grid

    7. Longer and more energy storage

    We’ve taken leaps and bounds in the energy storage sector. The U.S. Energy Information Administration (EIA) has said storage capacity will double in 2024 and continue to increase, making the storage of renewable energy a more viable option in the longer term, further reducing dependence on non-renewable backups or supplementation. At the same time, the storage cost is declining as capacity increases and battery degradation decreases.

    8. The solar grid side hustle

    As Kartik Menon pointed out in their recent article, improvements in grid analytics and connectivity have the potential to open up a new solar side hustle and regional energy collaboration. As sun-soaked homes generate more power than they can use or store during peak production, they need a marketplace to offload the excess and potentially pay for energy when production is low. This system could turn whole blocks into microgrids of neighbors sharing resources.

    Grid energy is essential to daily life. But the grids of tomorrow are going to look very different. More efficiency, decentralization, greater security, and AI-powered optimizations will help grids power through and deliver to their customers. We’ve already seen these technologies take shape today, but they still have a way to go. While there is undoubtedly more to be discovered and missing links to be revealed, we’re on our way to the green-energy-powered world we want to see.



    Abe Issa

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  • The price tag of COP28’s renewable energy pledge

    The price tag of COP28’s renewable energy pledge

    COP28 wrapped on Wednesday with officials touting a pledge to triple the world’s renewable energy capacity by 2030. It even came twinned with a vow to double global energy-saving efforts over the same period.

    Predictably, the promise came with some high-flying rhetoric.

    COP28 President Sultan al-Jaber, the oil CEO helming the talks, claimed the goal “aligns more countries and companies around the North Star of keeping 1.5 degrees Celsius within reach than ever before,” referring to the Paris Agreement target for limiting global warming.

    But are the flashy pledges as ambitious as they sound? POLITICO crunched the numbers and here’s what we found: While the renewable energy target is well within reach, progress on energy efficiency has been a lot slower.

    Countries would need to cut their energy intensity — the amount of energy used per unit of GDP — at least twice as fast between 2023 and 2030 as they did in previous years, which calls for major investments and substantial changes in individual behavior.

    To achieve the renewable target, countries will need to bet big on solar and wind. These two technologies are set to account for around 90 percent of new capacity additions, due to their increasing availability and decreasing costs.

    Improving energy efficiency is a more complex challenge. It will require action on multiple fronts, from housing and construction to mobility and consumer behavior.

    Progress has been unequal and largely concentrated in richer countries, which also tend to attract most of the private investment in green technology. Good headway has been made in some areas like the electrification of transport, while building renovation is lagging.

    If world leaders are serious about these pledges, they’ll have to put their money where their mouth is (or convince private investors to do so) and mobilize nearly $30 trillion in green investment between now and 2030, with buildings and the industrial sector taking the lion’s share of these funds.

    Pricey, perhaps, but still probably cheaper than environmental catastrophe.

    Karl Mathiesen contributed reporting.

    Giovanna Coi

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  • WTF is the ‘Global Stocktake’? We explain the ‘heart’ of COP28

    WTF is the ‘Global Stocktake’? We explain the ‘heart’ of COP28

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    DUBAI, United Arab Emirates — Now the real work starts. 

    The first few days of the COP28 climate conference featured so many lofty declarations and flashy promises that you’d be forgiven for asking what delegates are still doing here. But the main negotiations have only just gotten underway. 

    At the core of this year’s summit sits something called the “Global Stocktake,” often abbreviated to GST — a nondescript name that conceals its vital role in international climate efforts. 

    In short, it’s about drawing up a report card on where the world stands eight years after signing the Paris Agreement, and how countries plan to fix their inevitable shortcomings. That plan coming out of COP28 will help determine whether the world can stave off the worst impacts of climate change or careen toward unlivable temperatures. 

    German climate envoy Jennifer Morgan called the stocktake the “heart” of the Paris climate accord; Toeolesulusulu Cedric Schuster, chair of the Alliance of Small Island States, labeled it a “lifeline” for especially vulnerable countries like his native Samoa. 

    The outcome of this obscure process is also what high-ranking ministers will be haggling over when they arrive for the second week of COP28 — and what the United Arab Emirates hosts will be judged on in the end. 

    “What makes this COP unique as compared to the previous COPs? First and foremost, it’s the Global Stocktake,” EU lead negotiator Jacob Werksman told reporters on Monday. 

    So what is it? Let’s take a look. 

    What are we even talking about? 

    The Global Stocktake broadly refers to a thorough assessment of how much progress countries are making toward the Paris Agreement targets, which committed countries to limiting global warming to below 2 degrees Celsius and ideally to 1.5C compared to the pre-industrial era. 

    The process consists of three components. The first stage, gathering all the relevant information, began two years ago. The second phase, evaluating that data, ended this summer. 

    The final task — the response to this assessment — concludes at COP28. That’s the hard part.

    Under the Paris accord’s terms, countries have to conduct this exercise every five years. 

    Hang on, the assessment already happened? 

    Yup. You’ll sometimes hear that countries will conduct an assessment of their climate efforts while in Dubai, but the United Nations already published its report summarizing the findings in September — concluding that the world is falling short of its Paris goals. 

    “That assessment has been done, it is clear we are not on a track,” Morgan told a press conference in Dubai last week. With current efforts, she noted, “we will see a temperature rise of 2.5C to 2.9C.” 

    She added: “That is unimaginable.”

    Beyond 1.5C, climate impacts like extreme weather or sea-level rise get substantially worse. Scientists warn that overshooting that threshold risks triggering irreversible tipping points like dramatic polar ice loss, which would further exacerbate warming. 

    So what’s happening at COP28? 

    Negotiators in Dubai are discussing what countries should do with that report, which gave strict instructions to retain any hope of hitting the 1.5C target: First, cut 43 percent of greenhouse gas emissions this decade (compared to 2019 levels), then hit net-zero emissions by 2050. 

    But there are profound divisions over how to get there.  

    “The first component is taking stock of what the gaps are,” said Tom Evans, who tracks the stocktake negotiations in Dubai for think tank E3G. “Second, what do you do about these gaps? And that’s where the political flashpoints are.” 

    What could that response look like? 

    A lot of things, but the idea is for everyone from the Paris Agreement — that’s nearly 200 countries — to endorse a coherent plan by the summit’s end. 

    Again, not easy. 

    The document is expected to both look back at what went wrong and then look ahead with guidelines on how to remedy those shortcomings. That roadmap should include a climate wish list — everything from cutting emissions to preparing communities for climate change fallout to financing for both.

    So … words on a page. Does that even matter? 

    It does, for a few reasons. 

    First, the text will give clear directions to countries as they draw up their next climate action plans. The Paris Agreement requires governments to submit new plans by COP30, which takes place in Brazil in 2025. 

    Second, those words send a powerful signal to markets, local governments and more. If nearly 200 countries agree on a text that says a coal phaseout is necessary, investors will take the hint. 

    With the stocktake, “we have the opportunity to take a set of decisions … that finds the clarity that business leaders need to invest in the future,” Morgan said. 

    The outcome will also test the Paris accord’s integrity. These regular check-ins and the requirement to then update climate plans are meant to ensure everyone is upping their efforts over time. 

    “The effectiveness of the Paris Agreement is at stake,” Evans said. 

    And what do countries want? 

    The end result should set out what to do about planet-warming fossil fuels, as well as efforts to prepare for a warmer future and steps to ensure poorer countries have the resources to do that, as well. 

    “No one is trying to tear the whole thing down,” said Evans. 

    That doesn’t mean countries are close to an agreement. 

    Urgent calls for a fossil fuel “phaseout” — a much-debated term — are especially contentious. 

    Many developing countries say they need more financial support to back ambitious language on fossil fuels and other efforts to reduce emissions.

    German climate envoy Jennifer Morgan called the stocktake the “heart” of the Paris climate accord | Sean Gallup/Getty Images

    Meanwhile, the EU, the U.S. and climate-vulnerable countries are trying to ensure new plans don’t exempt any industries and cover all greenhouse gasses, not just carbon dioxide — something China recently said it was on board with.

    Going in the other direction, several countries whose economies depend on oil and gas exports — Russia and Saudi Arabia among them — are trying to push for language that would allow for the continued use of fossil fuels. 

    What’s the UAE’s role here? 

    The UAE is running the show and must shepherd the stocktake to a conclusion. At some point, the officials in charge will have to produce a draft text for countries to accept or reject. 

    COP28 President Sultan al-Jaber — who, controversially also helms the UAE’s state-run oil giant — has repeatedly insisted he would push for the “most ambitious response possible” to the stocktake. But he has remained vague on what that might look like. 

    Still, Evans said, “They’re aware that it’s the centerpiece of their COP. The shine of those early pledges will fade, and they’ll need to produce something.” 

    How are the negotiations going? 

    There are already some rocky signs. 

    As of Monday evening, negotiators hadn’t produced a detailed draft text, despite spending some 10 hours talking behind closed doors on Sunday. 

    A text outlining possible “building blocks” was released on Friday, but it’s more of a broad summary that left all the hard questions unanswered. Regarding the energy sector, for example, options included “phasedown/out fossil fuels” and “phasedown/out/no new coal.” In other words: All options are on the table.

    What’s next? 

    Over the coming days, negotiators will try to agree on as many sections of the text as possible, but their bosses will take over in the summit’s second week to resolve the thornier questions. 

    This week’s talks will “inevitably lead to some very important political questions for ministers to resolve in the second week,” said Werksman, the EU negotiator. “Exactly what those questions are, we can’t fully speculate on — but we imagine that the issue of how we’re going to address fossil fuels will be top of the list.”

    Technically the deadline is December 12, but if past COPs are any guide, overtime is possible.

    Zia Weise

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  • Climate action or distraction? Sweeping COP pledges won’t touch fossil fuel use

    Climate action or distraction? Sweeping COP pledges won’t touch fossil fuel use

    DUBAI, United Arab Emirates — A torrent of pollution-slashing pledges from governments and major oil companies sparked cries of “greenwashing” on Saturday, even before world leaders had boarded their flights home from this year’s global climate conference.  

    After leaders wrapped two days of speeches filled with high-flying rhetoric and impassioned pleas for action, the Emirati presidency of the COP28 climate talks unleashed a series of initiatives aimed at cleaning up the world’s energy sector, the largest source of planet-warming greenhouse gas emissions. 

    The announcement, made at an hours-long event Saturday afternoon featuring U.S. Vice President Kamala Harris and European Commission President Ursula von der Leyen, contained two main planks — a pledge by oil and gas companies to reduce emissions, and a commitment by 118 countries to triple the world’s renewable energy capacity and double energy savings efforts. 

    It was, on its face, an impressive and ambitious reveal. 

    COP28 President Sultan al-Jaber, the oil executive helming the talks, crowed that the package “aligns more countries and companies around the North Star of keeping 1.5 degrees Celsius within reach than ever before,” referring to the Paris Agreement target for limiting global warming. 

    But many climate-vulnerable countries and non-government groups instantly cast an arched eyebrow toward the whole endeavor.

    “The rapid acceleration of clean energy is needed, and we’ve called for the tripling of renewables. But it is only half the solution,” said Tina Stege, climate envoy for the Marshall Islands. “The pledge can’t greenwash countries that are simultaneously expanding fossil fuel production.” 

    Carroll Muffett, president of the nonprofit Center for International Environmental Law, said: “The only way to ‘decarbonize’ carbon-based oil and gas is to stop producing it. … Anything short of this is just more industry greenwash.”

    The divided reaction illustrates the fine line negotiators are trying to walk. The European Union has campaigned for months to win converts to the pledge on renewables and energy efficiency the U.S. and others signed up to on Saturday, even offering €2.3 billion to help. And the COP28 presidency has been on board. 

    But Brussels, in theory, also wants these efforts to go hand in hand with a fossil fuel phaseout — a tough proposition for countries pulling in millions from the sector. The EU rhetoric often goes slightly beyond the U.S., even though the two allies officially support the end of “unabated” fossil fuel use, language that leaves the door open for continued oil and gas use as long as the emissions are captured — though such technology remains largely unproven.

    Von der Leyen was seen trying to thread that needle on Saturday. She omitted fossil fuels altogether from her speech to leaders before slipping in a mention in a press release published hours later: “We are united by our common belief that to respect the 1.5°C goal … we need to phase out fossil fuels.” 

    Harris on Saturday said the world “cannot afford to be incremental. We need transformative change and exponential impact.” 

    But she did not mention phasing out fossil fuels in her speech, either. The U.S., the world’s top oil producer, has not made the goal a central pillar of its COP28 strategy. 

    Flurry of pledges  

    The EU and the UAE said 118 countries had signed up to the global energy goals.

    The new fossil fuels agreement has been branded the “Oil and Gas Decarbonization Charter” and earned the signatures of 50 companies. The COP28 presidency said it had “launched” the deal with Saudi Arabia — the world’s largest oil exporter and one of the main obstacles to progress on international climate action.

    Among the signatories was Saudi state energy company, Aramco, the world’s biggest energy firm — and second-biggest company of any sort, by revenue. Other global giants like ExxonMobil, Shell and TotalEnergies also signed.

    They have committed to eliminate methane emissions by 2030, to end the routine flaring of gas by the same date, and to achieve net-zero emissions from their production operations by 2050. Adnan Amin, CEO of COP28, singled out the fact that, among the 50 firms, 29 are national oil companies.  

    “That in itself is highly significant because you have not seen national oil companies so evident in these discussions before,” he told reporters.

    The COP28 presidency could not disguise its glee at the flurry of announcements from the opening weekend of the conference.

    “It already feels like an awful lot that we have delivered, but I am proud to say that this is just the beginning,” Majid al-Suwaidi, the COP28 director general, told reporters. 

    Fred Krupp, president of the U.S.-based Environmental Defense Fund, predicted: “This will be the single most impactful day I’ve seen at any COP in 30 years in terms of slowing the rate of warming.” 

    But other observers said the oil and gas commitments did not go far beyond commitments many companies already make. Research firm Zero Carbon Analytics noted the deal is “voluntary and broadly repeats previous pledges.”

    Melanie Robinson, global climate program director at the World Resources Institute, said it was “encouraging that some national oil companies have set methane reduction targets for the first time.” 

    But she added: “Most global oil and gas companies already have stringent requirements to cut methane emissions. … This charter is proof that voluntary commitments from the oil and gas industry will never foster the level of ambition necessary to tackle the climate crisis.” 

    Some critics theorized that the COP28 presidency had deliberately launched the renewables and energy efficiency targets together with the oil and gas pledge. 

    The combination, said David Tong, global industry campaign manager at advocacy group Oil Change International, “appears to be a calculated move to distract from the weakness of this industry pledge.”

    The charter, he added, “is a trojan horse for Big Oil and Gas greenwash.” 

    Beyond voluntary moves 

    A push to speed up the phaseout of coal power garnered less attention — with French President Emmanuel Macron separately unveiling a new initiative and the United States joining a growing alliance of countries pledging to zero out coal emissions.

    Macron’s “coal transition accelerator” focuses on ending private financing for coal, helping coal-dependent communities and scaling up clean energy. And Washington’s new commitment confirms its path to end all coal-fired power generation unless the emissions are first captured through technology. U.S. use of coal for power generation has already plummeted in the past decade. 

    The U.S. pledge will put pressure on China, the world’s largest consumer and producer of coal, as well as countries like Japan, Turkey and Australia to give up on the high-polluting fuel, said Leo Roberts, program lead on fossil fuel transitions at think tank E3G. 

    “It’s symbolic, the world’s biggest economy getting behind the shift away from the dirtiest fossil fuel, coal. And it’s sending a signal to … others who haven’t made the same commitment,” he said. 

    The U.S. also unveiled new restrictions on methane emissions for its oil and gas sector on Saturday — a central plank of the Biden administration’s climate plans — and several leaders called for greater efforts to curb the potent greenhouse gas in their speeches. 

    Barbados Prime Minister Mia Mottley called for a “global methane agreement” at COP28, warning that voluntary efforts hadn’t worked out. Von der Leyen, meanwhile, urged negotiators to enshrine the renewables and energy efficiency targets in the final summit text. 

    Mohamed Adow, director of the think tank Power Shift Africa, warned delegates not to get distracted by nonbinding pledges. 

    “We need to remember COP28 is not a trade show and a press conference,” he cautioned. “The talks are why we are here and getting an agreed fossil fuel phaseout date remains the biggest step countries need to take here in Dubai over the remaining days of the summit.”

    Sara Schonhardt contributed reporting.

    Zia Weise and Charlie Cooper

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  • Kamala Harris at climate summit: World must ‘fight’ those stalling action

    Kamala Harris at climate summit: World must ‘fight’ those stalling action

    DUBAI — The vast, global efforts to arrest rising temperatures are imperiled and must accelerate, U.S. Vice President Kamala Harris told the world climate summit on Saturday. 

    “We must do more,” she implored an audience of world leaders at the COP28 climate talks in Dubai. And the headwinds are only growing, she warned.

    “Continued progress will not be possible without a fight,” she told the gathering, which has drawn more than 100,000 people to this Gulf oil metropolis. “Around the world, there are those who seek to slow or stop our progress. Leaders who deny climate science, delay climate action and spread misinformation. Corporations that greenwash their climate inaction and lobby for billions of dollars in fossil fuel subsidies.” 

    Her remarks — less than a year before an election that could return Donald Trump to the White House — challenged leaders to cooperate and spend more to keep the goal of containing global warming to 1.5 degrees Celsius within reach. So far, the planet has warmed about 1.3 degrees since preindustrial times.

    “Our action collectively, or worse, our inaction will impact billions of people for decades to come,” Harris said.

    The vice president, who frequently warns about climate change threats in speeches and interviews, is the highest-ranking face of the Biden White House at the Dubai negotiations.

    She used her conference platform to push that image, announcing several new U.S. climate initiatives, including a record-setting $3 billion pledge for the so-called Green Climate Fund, which aims to help countries adapt to climate change and reduce emissions. The commitment echoes an identical pledge Barack Obama made in 2014 — of which only $1 billion was delivered. The U.S. Treasury Department later specified that the updated commitment was “subject to the availability of funds.”

    Meanwhile, back in D.C., the Biden administration strategically timed the release of new rules to crack down on planet-warming methane emissions from the oil and gas sector — a significant milestone in its plan to prevent climate catastrophe.

    The trip allows Harris to bolster her credentials on a policy issue critical to the young voters key to President Joe Biden’s re-election campaign — and potentially to a future Harris White House run. 

    “Given her knowledge base with the issue, her passion for the issue, it strikes me as a smart move for her to broaden that message out to the international audience,” said Roger Salazar, a California political strategist and former aide to then-Vice President Al Gore, a lifetime climate campaigner. 

    Yet sending Harris also presents political peril. 

    Biden has taken flak from critics for not attending the talks himself after representing the United States at the last two U.N. climate summits since taking office. And climate advocates have questioned the Biden administration’s embrace of the summit’s leader, Sultan al-Jaber, given he also runs the United Arab Emirates’ state-owned oil giant. John Kerry, Biden’s climate envoy, has argued the partnership can help bring fossil fuel megaliths to the table.

    Harris has been on a climate policy roadshow in recent months, discussing the issue during a series of interviews at universities and other venues packed with young people and environmental advocates. The administration said it views Harris — a former California senator and attorney general — as an effective spokesperson on climate. 

    “The vice president’s leadership on climate goes back to when she was the district attorney of San Francisco, as she established one of the first environmental justice units in the nation,” a senior administration official told reporters on a call previewing her trip. 

    Joining Harris in Dubai are Kerry, White House climate adviser Ali Zaidi and John Podesta, who’s leading the White House effort to implement Biden’s signature climate law. 

    Biden officials are leaning on that climate law — dubbed the Inflation Reduction Act — to prove the U.S. is doing its part to slash global emissions. Yet climate activists remain skeptical, chiding Biden for separately approving a series of fossil fuel projects, including an oil drilling initiative in Alaska and an Appalachian natural gas pipeline.

    Similarly, the Biden administration’s opening COP28 pledge of $17.5 million for a new international climate aid fund frustrated advocates for developing nations combating climate threats. The figure lagged well behind other allies, several of whom committed $100 million or more.

    Nonetheless, Harris called for aggressive action in her speech, which was followed by a session with other officials on renewable energy. The vice president committed the U.S. to doubling its energy efficiency and tripling its renewable energy capacity by 2030, joining a growing list of countries. The U.S. also said Saturday it was joining a global alliance dedicated to divorcing the world from coal-based energy. 

    Like other world leaders, Harris also used her trip to conduct a whirlwind of diplomacy over the war between Israel and Hamas, which has flared back up after a brief truce.

    U.S. National Security Council spokesperson John Kirby said Harris would be meeting with “regional leaders” to discuss “our desire to see this pause restored, our desire to see aid getting back in, our desire to see hostages get out.”

    The war has intruded into the proceedings at the climate summit, with Israeli President Isaac Herzog and Palestinian Authority leader Mahmoud Abbas both skipping their scheduled speaking slots on Friday. Iran’s delegation also walked out of the summit, objecting to Israel’s presence.

    Kirby said Harris will convey “that we believe the Palestinian people need a vote and a voice in their future, and then they need governance in Gaza that will look after their aspirations and their needs.”

    Although Biden won’t be going to Dubai, the administration said these climate talks are “especially” vital, given countries will decide how to respond to a U.N. assessment that found the world’s climate efforts are falling short. 

    “This is why the president has made climate a keystone of his administration’s foreign policy agenda,” the senior administration official said.

    Robin Bravender reported from Washington, D.C. Zia Weise and Charlie Cooper reported from Dubai. 

    Sara Schonhardt contributed reporting from Washington, D.C.

    Robin Bravender, Zia Weise and Charlie Cooper

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  • ‘We simply are nowhere’: EU slams lack of progress at G20 climate meeting

    ‘We simply are nowhere’: EU slams lack of progress at G20 climate meeting

    G20 climate ministers failed to make progress on key issues on Friday, drawing sharp criticism from the European Union. 

    Talks in the southern Indian city of Chennai took place against the backdrop of scientists finding that July is on track to become the world’s hottest month on record. 

    But the discussions wrapped up without consensus on the global transition away from fossil fuels; last week’s G20 energy ministerial ended on a similar note. 

    The EU, represented by Environment Commissioner Virginijus Sinkevičius at the meeting, responded with exasperation. 

    “At the end of our meeting today, is the glass half full or half empty?” Sinkevičius asked in his closing remarks. “It is certainly empty when we look at where we stand on G20 commitments to address climate change — we simply are nowhere.” 

    Noting the devastation wrought by extreme weather across the globe in recent weeks, he decried the G20’s inability to find agreement on climate and energy issues as “disheartening.” 

    He added: “We cannot be driven by the lowest common denominator, or by narrow national interests. We cannot allow the pace of change to be set by the slowest movers in the room.” 

    France’s Ecological Transition Minister Christophe Bechu also told Agence France-Presse he was “disappointed” with the outcome, adding that discussions with China, Saudi Arabia and Russia in particular had been “complicated.”

    The split forced the Indian G20 presidency to publish an incomplete outcome document on issues countries managed to agree on, as well as an additional chair’s summary on others where ministers did not reach consensus. 

    “There are some issues about energy and target-oriented issues,” Indian Climate Minister Bhupender Yadav acknowledged in a press conference Friday. 

    There was no agreement on setting global goals for scaling up the deployment of renewables and energy efficiency — a key objective for the Emirati presidency of this year’s COP28 climate talks — or on phasing down planet-warming fossil fuels.

    Earlier on Friday, COP28 President Sultan al-Jaber expressed concern that the EU-backed target for tripling global renewable capacity had “yet to find expression in G20 outcomes.” 

    The chair’s summary included a short section on the energy transition that listed the issues that were discussed, concluding: “G20 members expressed views reiterating their positions” outlined at last weekend’s energy ministerial in Goa. 

    Discussions on efforts to reach a peak in global emissions by 2025 also ended without consensus, according to the document. 

    German climate envoy Jennifer Morgan echoed Sinkevičius’ disappointment, saying: “While fires rage around the world and temperatures break records, the G20 as a group has unfortunately been unable to act with the necessary sense of urgency and clarity.” 

    Progress, she added, “was blocked by a small group of countries.”  

    The EU and Germany both praised the G20’s “strong signal” on stepping up the fight against plastic pollution and deforestation, as well as countries’ agreement to look at deep-sea mining regulation.

    Still, on climate, the G20 “were asked to make bold choices, to demonstrate courage, commitment and leadership,” said Sinkevičius. “But we, collectively, failed to achieve that.” 

    All eyes are now on the G20 leaders’ summit in New Delhi in September. 

    “The disappointing G20 energy and climate outcomes show ministers don’t have the mandate to negotiate on the defining issues of our time,” said Luca Bergamaschi, co-founder of Italian climate think tank ECCO. “G20 leaders must step in and together agree the actions needed for a safer planet.”

    Louise Guillot contributed reporting.

    Zia Weise

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  • The SBA guidelines on energy efficiency in mortgages: Where things stand 180 days before coming into force – Banking blog

    The SBA guidelines on energy efficiency in mortgages: Where things stand 180 days before coming into force – Banking blog

    The self-regulation guidelines from the Swiss Bankers Association (SBA) on the promotion of energy efficiency in mortgages have shone a sudden spotlight on the subject of ESG in financing. While the current guidelines are limited in scope, they nevertheless present challenges for banks in Switzerland, as they may well be extended in the future. Banks are well advised to adjust their lending operating model not only in the short term, but also strategically for the longer term.

    ESG criteria for mortgage financing are new in Switzerland

    With the Paris Agreement, Switzerland set a goal of reducing greenhouse gases by 50% from a 1990 baseline by 2030. However, this is only a stepping stone to the net zero target for 2050.[i] Despite making significant progress, Switzerland narrowly missed its targets for 2020.[ii]

    Buildings account for a significant proportion of greenhouse gas emissions (roughly 25%) and an even higher proportion of energy consumption (approximately 45%).[iii],[iv] Heating, much of it powered by fossil fuels such as natural gas and oil, makes up the bulk (68%) of this energy consumption.[v] Achieving climate goals will necessarily entail building renovations with focus on energy efficiency, but the 0.9% renovation rate in Switzerland remains far too low despite the incentives of a carbon tax and a building energy renovation programme.[vi] This suggests that there may be an “information deficit”. Unsurprisingly therefore, mortgages and mortgage providers are increasingly attracting attention from regulators — after all, mortgage providers have regular contact with both new and existing property owners, and consequently have opportunities to discuss sustainability issues with their clients. But while in the EU clear rules on dealing with potential climate risks from financing already exist (EBA/GL/2020/06, 4.3.5 and 4.3.6), Switzerland has so far limited itself to disclosure of climate-related financial risks, and only for category 1 and 2 banks (FINMA Circular 2016/01). Sustainability is an increasingly important topic in the political arena, fuelled among other things by the debate around UBS and CS. For example, a bill of targets in climate protection, innovation and energy independence was adopted with a substantial majority of 59.1% in the referendum of 18 June 2023, and this is likely to further intensify regulatory pressure. The SBA self-regulation “Guidelines for mortgage providers on the promotion of energy efficiency” that came into force on 1 January 2023 introduce ESG-related lending requirements for the first time in Switzerland, requiring banks to address the topic of energy efficiency in buildings with customers for mortgage financing.[vii],[viii]

    Numerous challenges for banks despite narrow scope

    It should be noted that there are two limitations to the guidelines. First, they are voluntary self-regulation by the Swiss Bankers Association (SBA).[ix] Unlike other self-regulation (such as CDB 20), the guidelines are only binding on SBA member institutions. This means for example that the Raiffeisen banks are not directly affected by the guidelines despite their large share of the mortgage market (approx. 17% in 2022). The same goes for insurance companies and pension funds (approx. 5% market share in 2022).[x] There are also limitations relating to the properties concerned. The guidelines apply exclusively to owner-occupied single-family and vacation homes. Nevertheless, the new requirements are sufficiently comprehensive to present banks with challenges that should not be underestimated — not least because the guidelines also apply to existing loans. The guidelines concern five main topic areas: (see Figure 1 for detailed contents of each section).

    1. Provision of information (Art. 5)

    2. Advising customers (Art. 2 & Art. 5)

    3. Terms and conditions (Art. 3)

    4. Data (Art. 4)

    5. Training and professional development (Art. 6)

    With the exception of the “Terms and conditions”, the requirements in each area are compulsory and member institutions must implement them appropriately. However, implementation is complex because the guidelines contain principles-based requirements (thus leaving room for interpretation) while also covering matters that have an impact on the overall process (such as capturing energy efficiency data). Figure 1 provides an overview of the key contents along with selected implementation challenges for each topic area.

    SBA image 1

    Figure 1: Overview of key contents of the new guidelines and selected challenges for banks

    It is unsurprising that some Swiss banks have made more progress than others with implementation, particularly in view of the transition period up to 1 January 2024. Nevertheless, banks would be well advised to obtain clarity as soon as possible as to what changes will be needed by the end of 2023.  If they fail to do so, they run the risk of having to implement a large number of tactical auxiliary measures shortly before the end of the transition period, which could impair their competitiveness. An interim analysis by the exclusive Deloitte Mortgage Survey in early June (see Figure 2) found that some 88% of institutions indicated that they had already incorporated ESG issues into their consultations. Where further-reaching measures are concerned, however, the picture is more differentiated. Just 21% of respondents use ESG as a criterion in property appraisals (for mark-up/write-down purposes), while only 33% have special terms for houses with a good eco score. By contrast, 25% of respondents plan to define ESG-related KPI targets for their mortgage portfolios, while 42% intend to introduce customer incentives for ESG renovations in 2024.

    ESG_Blog_1

    Figure 2: Survey on implementation status (as of 30 June 2023, n=24)

    Taking the opportunity for sustainable optimisation of lending operations

    While banks have the option of relying on particular tactical measures in implementing the new guidelines (e.g. manual entry of certificates and labels in customer files, fact sheets/links to subsidy programmes), this approach is likely to fall short in meeting changing regulatory demands. The provisions in some other markets go considerably further than those in Switzerland. For example, the draft of the seventh MaRisk amendment (published in September 2022) adopts parts of the previous German Federal Financial Supervisory Authority (BaFin) memorandum on managing sustainability risks, such as adjustments to credit risk strategies and appetite considering ESG risks, as well as ESG risk measurement at the portfolio level. The requirements will be subject to audit. At present this is not the case for the new SBA guidelines, but it is quite conceivable that FINMA will take similar measures in the years to come. The scope of properties affected is also likely to expand (to include, for example, investment properties). Last but not least, it is also clear that Switzerland will not be able to avoid the international trend towards better measurement and reporting of climate risks. Banks are therefore well advised not to take the changes associated with the SBA guidelines too lightly. The opportunity here is to use the momentum to achieve a better strategic alignment of their lending business with future challenges, such as those related to their future operating model (see also https://blogs.deloitte.ch/banking/2021/03/strategic-trends-and-implications-for-bank-operating-models.html). There are already examples in the market of banks with innovative, comprehensive solutions, such as home2050, a collaboration between Basellandschaftliche Kantonalbank and the canton’s leading energy supplier:  among other things this offers a solution for assessment of the potential, financing and installation of solar equipment and the associated energy system.

    In deciding what to do next, banks should specifically ask themselves the following five key questions:

    1. What gaps still exist in respect of the SBA requirements?

    2. What short, medium and long-term measures can be taken to close these gaps?

    3. What further initiatives/projects could impact the implementation of the guidelines, and where can synergies be utilised?

    4. Are we seeking a purely tactical implementation for the sake of compliance, or will we utilise the momentum for a comprehensive, forward-looking transformation of the lending business?

    5. Will we implement the requirements ourselves or work with an external partner?

    You can also view this blog on our website in English and German.

    Marc Grueter blog

    Marc Grüter, Partner, Lead FS Transformation

    Marc has 16 years of experience as a partner for leading strategic consulting firms and Big Four companies in Switzerland. Within his project portfolio, he focuses on:

    • Strategy development, target operating model design and digitalisation

    • Process optimisation and re-engineering, efficiency enhancement and cost optimisation

    • Automation, transformation and application of advanced analytical tools

    Email | LinkedIn

    Eric blog

    Eric Gutzwiller, Director, FS Transformation

    Eric has more than 10 years of consulting experience for leading universal and cantonal banks. Within his project portfolio, he focuses on:

    • Front-to-back lending process optimisation, standardisation, application of digital automated technologies

    • Strategy development and redesign, front-end and sales enablement, income optimisation projects

    Complex reorganisations and comprehensive cost optimisation initiatives at banks.

    Email  | LinkedIn

      Simon heller blog

    Simon Heller, Director, Lead Sustainability Services Risk Advisory

    Simon has 18 years of experience in sustainability topics in the finance sector. Within his project portfolio, he focuses on:

    • Sustainability and climate strategies, climate risks

    • Net zero targeting and decarbonisation of enterprises and real estate portfolios

    • Sustainability reporting and ESG ratings

    Email| Linked

      Pablo Paron

    Pablo Paron, Manager, FS Transformation

    Pablo has more than 5 years of consulting experience for leading universal and cantonal banks. Within his project portfolio, he focuses on:

    • Design of target operating models (TOMs) for the lending business, including strategy development and redesign

    • Front-to-back process optimisation, standardisation and application of digital automated technologies

    Market entry strategies, due diligence and platform implementation

    Email| LinkedIn 

    ____________________________________________________________________________________________________

    [i] https://www.bafu.admin.ch/bafu/en/home/topics/climate/info-specialists/emission-reduction/reduction-targets.html

    [ii] https://www.bafu.admin.ch/bafu/en/home/topics/climate/info-specialists/emission-reduction/reduction-targets.html

    [iii] Federal Office for the Environment [FOEN] – CO2 statistics (2022)

    [iv] Swiss Federal Office of Energy [SFOE] – Analysis of Swiss energy consumption 2000-2020 by specific use (2021)

    [v] The Federal Council – Switzerland’s long-term climate strategy (2021)

    [vi] https://www.sia.ch/de/politik/energie/modernisierung-gebaeudepark/

    [vii] Requirements are only binding for SBA member banks

    [viii] A transition period until 1 January 2024 applies for adaptation of internal bank processes

    [ix] Cf. https://www.swissbanking.ch/en/topics/regulation-and-compliance/self-regulation

    [x] Market share based on own calculations using SNB and FINMA data

    Lena Woodward

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  • This Is the Solution You Need to Both Cut Costs and Go Green | Entrepreneur

    This Is the Solution You Need to Both Cut Costs and Go Green | Entrepreneur

    Opinions expressed by Entrepreneur contributors are their own.

    Representing more than 99% of all businesses across the country and employing some 60 million people, the success of small and medium-sized business (SMBs) is intrinsically linked to the economy’s well-being. But times are tough for SMBs: margins are narrowing, interest rates are rising, supply chain shortages and inflation remain rampant and to top it all off, stakeholder demands for sustainability have never been greater. Today’s pressures demand new solutions; with clean technologies, SMBs have the chance to not only address and overcome these challenges but also turn them into a competitive advantage.

    While the word “cleantech” often conjures up sprawling images of utility-scale solar arrays and offshore wind farms, this is a fairly superficial depiction of the industry — a stereotype, so to speak. In reality, many small-scale cleantech solutions are quickly becoming a regular part of consumers’ everyday lives and increasingly playing an outsized role in reducing businesses’ operating costs. For many — like locally owned and operated retail business owners — these expenses underscore a majority of their ongoing resource challenges and present a massive economic opportunity to advance cleantech adoption.

    Related: What You Can Learn From the Rise of Sustainability-Focused Entrepreneurship

    Slashing energy bills

    Rising and seldom-predictable energy costs have long been a thorn in SMB owners’ sides. Retail spaces, especially restaurants, for example, can’t turn off — or even turn down — their appliances, cooling equipment or lighting to scale back on operational costs, making them particularly susceptible to volatile energy prices.

    Fortunately, cleantech business models, such as Energy Efficiency as a Service (EEaaS) are enabling new solutions to this problem, allowing businesses to access cost-and emission-saving equipment upgrades through long-term contracts. And within just a few years, these investments pay for themselves through cumulative energy savings. From new HVAC architectures to optimized lighting, temperature and refrigeration controls, IoT sensors and heat pumps, everyday cleantech solutions are proven to drive down operating costs, freeing up time and capital that owners can deploy elsewhere.

    Determining what investments are needed might sound cumbersome, but experienced and trustworthy cleantech partners make it easy. After assessing a space’s energy footprint, EEaaS companies can quickly identify a site’s most pressing upgrade needs, facilitate immediate action and deliver measurable outcomes.

    Driving public and private favor

    Understanding macro forces that are actively reforming the U.S. economy is also key to staying profitable, as it enables business owners to align their core offerings with consumer wants and needs, minimizing commercial friction for a more pleasant experience. In recent years, sustainability, once an afterthought, now plays an often outsized role in consumer choices. Inundated with impactful reminders of climate change, including extreme weather events, rising sea temperatures and declining biodiversity, consumers want to know that the businesses they’re frequenting are aware of their environmental impact and actively looking to reduce it.

    In addition to sizable cost savings, replacing inefficient technologies with cleaner alternatives offers SMBs opportunities to leverage reputational benefits and boost customer satisfaction. From improved indoor air quality and temperature stability to quicker, more reliable service operations and sensory-friendly lighting, the opportunities of sharing one’s sustainability journey are unparalleled. Customers quickly take notice and are inclined to come back.

    And for franchisees, incorporating cleantech into your operations can help drive positive corporate relationships. Showcasing environmental proactivity and improved customer contentment is bound to impress, especially when paired with long-term overhead savings, which cleantech fruitfully delivers.

    Related: The Evergreen Action Path to Reaching 100% Clean Energy

    Getting ahead of the curve

    While the prospect of mandatory environmental, social and governance (ESG) reporting remains distant for some, this attitude runs contrary to existing policy and regulatory signals and will lead to detrimental long-term outcomes. The SEC initially proposed ESG reporting guidelines in 2022 and though it faced delays following regulatory disagreements, it’s widely expected to be finalized in 2023. Recognizing the economic imperative of ESG adaptation, other jurisdictions have also moved quickly to embrace mandatory ESG reporting. The European Union strengthened its existing regulations earlier this year, for example, whereas China, Canada and others are widely expected to roll out their own ESG frameworks by 2023 and 2024, respectively.

    Businesses that are part of a chain, franchise or other corporate structure will inevitably feel pressure from their parent companies to reduce greenhouse gasses in the coming years. Even those that are fully independent will bear some impact as consumers continue to make clear the importance of strong ESG practices. However, getting ahead of the pack by adopting cleantech can preemptively neutralize these pressures, ensuring compliance with corporate ESG policies while positioning oneself as a community leader on the environmental front — an increasingly powerful sales hook.

    Now more than ever, SMBs need real, tangible solutions to rising operating costs and evolving consumer demands. Solutions must be flexible, affordable and long-lasting; cleantech, despite its niche-sounding nature, has broad applications that can help small and medium business owners stay competitive and impress stakeholders with next-generation quality and efficiency. EEaaS companies — as key enablers of the green economy — offer SMBs streamlined access to clean technologies and their many benefits.

    Al Subbloie

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  • energyware™ Drives Energy Conservation for Businesses Through Incentives for Sales Team

    energyware™ Drives Energy Conservation for Businesses Through Incentives for Sales Team

    The company is offering a range of incentives for its channel to ensure energy conservation continues to be a priority.

    Press Release
    –

    Nov 21, 2022 08:00 EST


    NEW YORK, November 21, 2022 (Newswire.com)
    –
    energyware™, a leading national provider of energy-efficiency technology, is committed to offering support to businesses seeking energy-efficiency solutions and making advances in the environmental space. In alignment with this ongoing commitment, the company is pleased to announce it has launched a tiered incentive program for its sales agents that aims to drive the adoption of energy efficiency in businesses while providing the team with a range of compensation opportunities for their efforts.

    energyware’s™ sales agents help customers determine the best options in financing, design, implementation, oversite and return-on-investment accuracy. Now through Dec. 31, sales team members can earn the following incentives:

    • For the first $100,000 in sales, agents receive a $500 American Express gift card.
    • For $259,000 in sales, agents receive a $1,000 American Express gift card.
    • For $500,000 in sales, agents receive a $1,500 American Express gift card.
    • For $1 million in sales, agents receive airline credit and lodging for a trip of their choice (up to a $3,000 value).
    • For $5 million in sales, agents receive a leased luxury car of their choice (terms and qualifications may apply).

    Incentives are offered only to those who originate the lead, and only one incentive will be paid per deal. All sales must be completed before Dec. 31, 2022, at 11:59 p.m. to qualify. Agents will also receive a commission in addition to each incentive.

    “energyware™ is one of the most respected energy efficiency firms in the country, and our team helps customers make high-impact energy consumption improvements through our consulting services and design work,” said Jake Jacques, CEO of energyware™. “Our sales agents are making a difference through their support, and we want to ensure they’re recognized for their ongoing hard work and dedication in this critical space.” 

    The world we live in will change beyond all recognition unless there is a growing shift in how energy is used. energyware™ continues to be a one-stop-shop for businesses seeking energy efficiency solutions and has positioned itself as an industry leader in creating a better energy future.

    The company’s solutions are at the forefront of solid business practices, and its mission is to provide the highest quality services at below-market pricing. The knowledgeable and experienced energyware™ team offers project consultation, project management, and maximizing the overall performance of these solutions, which includes LED smart technology engineering and deployment and solar technology.

    Interested in accelerating the adoption of energy efficiency? Learn more about the promotion at the channel promotion page, where channel agents can submit leads directly to energyware™.

    About energyware™

    A national provider of energy efficiency technology, energyware™ eliminates the guesswork of energy efficiency by bringing engineers, designers, best-in-breed manufacturing, and trained energy technology installers all under one umbrella.

    Source: energyware

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  • energyware™ Highlights Benefits of Energy Efficiency, Sustainability Advisors for Businesses

    energyware™ Highlights Benefits of Energy Efficiency, Sustainability Advisors for Businesses

    Advisory services can offer businesses various valuable options when exploring every aspect of energy efficiency.

    Press Release
    –

    Oct 17, 2022 08:00 EDT


    NEW YORK, October 17, 2022 (Newswire.com)
    –
    Using energy more efficiently is one of the fastest, most cost-effective ways for businesses to save money, reduce greenhouse gas emissions, create jobs and meet growing energy demands. The bottom line is that anywhere energy is used, there is an opportunity to make improvements. energyware™, a leading national provider of energy-efficiency technology, is committed to offering support to businesses seeking energy-efficiency solutions and making strides in the environmental space.

    A recent survey found the global industry is accelerating its investment in energy efficiency in the next five years as the race toward net zero deepens. A key finding was that more than half, or 54%, of the companies surveyed are already investing, while 40% plan to make energy efficiency improvements in 2022. An energy efficiency expert will be able to provide these businesses with several options when looking at every aspect of energy efficiency, including solar, LED, HVAC, water efficiency and energy procurement.

    energyware’s™ solutions are at the forefront of solid business practices, and its mission is to provide the highest quality services at below-market pricing. The knowledgeable and experienced energyware™ team offers project consultation, project management and optimization of the overall performance of these solutions, which includes LED smart technology engineering and deployment and solar technology.

    “Energy efficiency experts design an easy path with less disruption for businesses that are looking to go green, as well as serves as a guide on the journey towards reducing expenses and the carbon footprint,” said Jake Jacques, CEO of energyware™. “Our team helps simplify this process for clients by assisting with selecting and implementing energy conservation practices and technologies.”

    In recent years, companies have ramped up their commitment to Environmental, Social and Governance (ESG) practices as investors and shareholders are now using it as an important capital market measure. And the evidence showing companies that prioritize ESG issues are generating superior long-term financial performance is undeniable.

    The world we live in will change beyond all recognition unless there is a growing shift in energy consumption. energyware™ continues to be a one-stop-shop for businesses seeking energy efficiency solutions. By offering a wide range of options, energyware™ has successfully positioned itself as an industry leader in this critical space.

    To learn more about how energy procurement, LED lighting and solar energy services can help businesses save money on energy costs, visit www.energywarellc.com.

    About energyware™
    A national provider of energy efficiency technology, energyware™ eliminates the guesswork of energy efficiency by bringing engineers, designers, best-in-breed manufacturing, and trained energy technology installers all under one umbrella.

    Source: energyware

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