Companies amp up energy concerns in era of roiling markets

As energy markets face volatility and unprecedented transformation, two recent surveys show how both corporations and utilities are dealing with new business complexities.

Nearly three-quarters of corporations see energy costs rising over the next five years, and almost four in 10 expect increases of at least 15 percent, according to a new survey.

Interviewing 100 companies with revenues of $1 billion or more -- including British Airways, Goodyear Tire & Rubber Company, China Southern Airlines and Marks & Spencer Group, among others -- the Ernst & Young survey sought to understand global corporate energy spending, efficiency measures, renewable integration and self-generating energy strategies.

Some 68 percent of respondents purchase electricity generated from renewable sources. Big names include IKEA, Google, Toyota, Toshiba, Hertz, FedEx, AT&T, Audi and PepsiCo. Most impressive, according to the report, VW plans to increase renewable energy usage to almost half (46 percent) of its total energy spending in the next five years.

While only a handful of respondents reported renewable energy accounting for more than five percent of their companies' total energy portfolio -- and more than half reported no self-generation -- the survey projects that one-third will increase that share over the next five years.

Still, challenges remain for global corporations in financing and capital expenditures to accurately predict payback periods for investments in advanced energy strategies.

"The barriers to self-generation and renewables adoption are mainly related to risk and financial return, suggesting that adoption could come even faster with financing innovations and increasing cost-competitiveness of renewables," said Gil Forer, Ernst & Young's Global Cleantech Leader in the report. "Only those businesses with a comprehensive and diverse energy strategy will be able to create and maintain competitive advantage in the resource-constrained world of today."

Energy efficiency remains a leading strategy with a variety of technologies deployed including energy demand management (47 percent), building energy management systems (20 percent), energy-efficiency lighting (18 percent) and building automation (18 percent).

While the E&Y survey gave a clear picture on current trends in the energy demand side, another recent survey by Black & Veatch sheds light on the big changes taking place in the U.S. electric utility industry.

Next page: 65 million electric vehicles by 2025?