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Sustainable Energy: Key Performance Indicators, Renewable Sources, and Sustainable Procurement | SAP Solutions


The energy sector is facing a crucial moment as the global community tackles the pressing issues of climate change and strives for a sustainable future. Achieving a secure and affordable energy supply while reducing carbon emissions demands a shift from fossil fuels to net-zero carbon sources. Oil, gas, and energy companies must adapt by cutting costs in existing operations and investing in new business models that promote sustainability.
SAP plays a pivotal role in supporting this transition for energy companies. It offers innovative solutions that optimize legacy energy sources, integrate low- and no-carbon alternatives, enhance energy network resilience, and create new growth opportunities through reinvented business models. Recently, in a webinar titled "Sustainable Energy Transition for a Low Carbon Future," Benjamin Beberness, the Vice President and Global Head of Oil, Gas, and Energy at SAP, shared insights with other industry experts. Together, they shed light on how the energy sector is taking action to redefine the future of energy and drive sustainable energy practices.
To successfully transition to sustainable energy sources, collaboration between technology and energy companies is vital. Together, they can identify economically viable and efficient methods to achieve an optimal energy mix during this transition. Utilizing digital technologies in tandem can lead to profitable operations that prioritize both people's well-being and the preservation of the planet. This collaborative effort requires a comprehensive understanding of regional regulations, staying updated with evolving business needs, and effective monitoring and reporting of day-to-day operations.
A concrete example of SAP's contribution is the GreenToken solution, which utilizes a unique digital twin on a blockchain. This tool enables businesses to gain transparency in material sourcing and access environmental, social, and governance (ESG) data throughout their supply chains.
Integrating Intelligent Asset Management
Intelligent asset management is a crucial element in supporting the sustainability goals of oil, gas, and energy companies. To enhance their manufacturing processes, embrace cleaner fuel alternatives, and optimize global operations, industry leaders are adopting digital technologies and proven solutions.
Research conducted by McKinsey emphasizes the importance of running assets efficiently to minimize environmental impact. A mere 10% increase in production efficiency can lead to a 4% reduction in emission intensity. Thus, businesses carefully assess factors such as vibration, heat issues, and asset lifespan to determine the need for asset replacement, considering cost, safety, and ESG criteria. Integrating ESG information into asset management strategies has become a growing priority for companies.
To optimize asset health, performance, and risk, SAP Asset Performance Management leverages advanced machine learning and analytics.
Evolution of Business Models for Diversification
Recognizing the urgency of diversifying their offerings, energy sector leaders are expanding services at electric vehicle charging stations and implementing low-carbon technologies in new maintenance and operations projects. The focus on adaptability has led these companies to seek flexible technology platforms to revitalize their operations, expand retail presence, and venture into renewable energy markets. Technological advancements play a pivotal role in accelerating the transition towards renewable energy sources.
SAP E-Mobility is a technology solution that supports this transition by providing companies with the capabilities needed to build, run, and manage electric vehicle charging networks all on one platform.
Driving Continuous Innovation
ESG regulations offer businesses the opportunity to reduce their ecological impact while fostering innovation to achieve sustainability goals. Keeping core operations clean and scalable allows companies to prioritize sustainability, cultivate a culture of innovation, and stand out from competitors. Establishing a dedicated optimization office and leveraging technologies like automation, optimization, and artificial intelligence (AI) are part of this approach. Engaging employees and the wider community in intrapreneurship helps translate high-level sustainability objectives into practical solutions for day-to-day operations. Access to sustainability-related data is crucial, and digital solutions and technology play a pivotal role in collecting and analyzing data to drive sustainability goals. Tools like a green ledger system help businesses track emissions and adapt to new regulations while fostering collaboration and innovation.
Industry cloud solutions from SAP are built on top of SAP Business Technology Platform (SAP BTP), designed with flexibility and choice in mind, enabling users to accelerate innovation and unlock business potential.
Establishing Key Performance Indicators (KPIs) for Sustainable Energy
In the pursuit of sustainable energy, businesses must identify essential KPIs to strike a balance between financial stability and emission reduction. Revenue remains a significant metric across industries, but energy companies focus on satisfying employees and shareholders while achieving environmental goals. Crucial KPIs encompass the percentage of energy generated from renewable sources, embodied carbon representing emissions throughout the lifecycle of materials, and measures to decarbonize operations, enhance building efficiency, and prioritize safety and environmental policies in infrastructure development.
SAP Sustainability Control Tower empowers businesses to enhance their sustainability performance by monitoring progress and gaining valuable insights from reliable sustainability data.
Recognizing the Importance of Sustainable Procurement
Sustainable procurement plays a central role in any comprehensive sustainability strategy. Companies actively seek suppliers that adhere to sustainable practices to reduce scope 3 emissions, implement robust measurement systems, promote supplier diversity, and enhance communication, driving transformative changes in procurement practices. Ensuring compliance with regulatory requirements, including due diligence laws and SEC reporting, becomes a priority for corporate-level initiatives and individual buyers. Sustainable procurement practices are seamlessly integrated into supplier risk management and qualification platforms, ensuring a comprehensive approach to sourcing sustainably.
Monitoring the production, supply, and utilization of energy sources across the entire supply chain is made possible with technology solutions like Flexinergy by Evolution Energy, available on SAP Store.
By leveraging intelligent asset management solutions, promoting business model diversification, driving continuous innovation, identifying key performance indicators, and embracing sustainable procurement, oil, gas, and energy businesses can harness industry-specific solutions to secure an affordable and sustainable energy future. Learn more about how SAP's innovative solutions, together with our partners, help fuel profitable operations while protecting both people and the planet.