Beyond industrial energy efficiency: defining the multiple roles that businesses can play for climate positive action

In the last three decades, significant research and policy attention across OECD countries has focused on how to encourage greater energy and resource efficiency in industry. This has been justified on the basis of cost, energy and emissions savings, and productivity improvements that can accrue to both large enterprises and SMEs. However, with the increasing urgency of climate change and in response to the energy crisis which has affected millions of businesses, there is a need to look beyond efficiency and consider the multiple roles that businesses can (and must) play in accelerating the transition towards net-zero. In focusing on efficiency, researchers and policymakers have tended to frame industrial organisations primarily as (1) consumers of energy and resources, with interventions to reduce these whilst maintaining output (productivity). There has also been a focus on ‘eco-innovation’ policies that address a second role that businesses play in energy transitions, as (2) enablers of low-carbon consumption (e.g. developing green products and services). Using findings from a two-year research study on the governance of SMEs and climate change, including 76 interviews with industry stakeholders, expert workshops, and a narrative literature review, we discuss the effectiveness of these dominant role-framings, and highlight three additional roles that warrant attention and analysis: businesses as (3) adopters of critical low-carbon technologies and services including demand-side flexibility; (4) citizens with the power to influence policy agendas and contribute towards local placemaking efforts; and (5) social influencers, creating and embedding social norms around consumption choices and environmental responsibilities. This paper seeks to widen the discourse of industrial decarbonisation, challenging researchers and policymakers to reconsider their assumptions about the role of business in the energy system, and to forge new approaches which capitalise on their potential for climate-positive action.