Digitalisation accelerates industry energy savings – report

British companies are reporting energy savings of up to £100,000 ($128,000) as a result of investment in digital technologies, a study has found.

The study, from the Manufacturers Association (MAKE UK) and software company Sage, found that almost two-thirds of the companies that had adopted digital technologies were making energy savings.

Half of them reported savings of between £10,000 and £100,000 ($12,890 – $128,000) in the past 12 months, while most of the rest reported savings below £10,000 that were nevertheless still significant to their balance sheet.

Moreover, the companies reported other benefits beyond energy savings, including labour and non-labour elements such as water savings and less material wastage.

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“Britain’s manufacturers have long been at the forefront of digital innovation globally and they have taken significant steps to cut carbon emissions and move towards net zero,” comments Stephen Phipson, CEO of MAKE UK, calling on the government to help to drive the process forward.

“Government needs to help them move forward faster by committing to a national rollout of the industrial digitalisation programme Made Smarter across the UK and expand its remit to include industrial decarbonisation.”

Made Smarter was formed as a public-private platform to connect manufacturers to digital tools and skills to advance their business operations.

While the traditional wisdom is that electrification is the key to decarbonising industry and manufacturing, the study shows that digitalisation is also a significant contributor.

Almost half of companies surveyed said that digitalisation has been their firm’s top driver of productivity improvements, with production processes streamlined and tightened up.

Multiple digital technologies are being deployed. In particular, manufacturers are using new data analytics tools, new data capturing tools and supply chain management tools to decarbonise.

Data analysis has also proved popular with manufacturers to help them drive energy efficiency and decarbonise their businesses with over a third of companies surveyed highlighting this as being helpful to their business.

The survey found that almost half of the manufacturers have implemented or are planning to implement plans to increase their energy efficiency, with just 16% having no plans.

Nevertheless, barriers to digitalisation remain, the survey found. These include the upfront investment costs and skills shortages.

Among the other recommendations is the introduction of a ‘Help to grow green’ scheme, with existing funds reshaped to become more accessible and including smaller funding levels, for example for energy audits and submetering.