Environmental matters have always been at the centre of what we do. That’s partly because our core product is recycled and reengineered tyres, but partly because energy is a big cost to us.
 
The energy efficiency measures we’ve incorporated into our manufacturing operation often have a payback period of less than two years.
 
Our individual assembly points are measured not only on the quality of what they produce but also on the kilowatt hours of energy they use per tyre. We have an energy clock in the factory that shows the kilowatts the factory is using at any one time. When we shut down for the weekend this has to read below 3kw before we leave.
 
Overall, we have reduced our electricity usage by about 15% and gas usage by about 10% without impacting on product quantity or quality and with very minimal capital expenditure.
 
We undertake such energy efficiency measures because we immediately see the financial return, not for any ‘green PR’ reasons. In some ways, energy efficiency should be viewed as a straightforward cost decision rather than anything green.
 
We helped found the Plymouth Resource Efficiency Club which enables local manufacturers to share best practice. It was established with a grant that required us to show total savings equal to five times the level of the grant. This was easily achieved and the savings continue.
 
When you move from energy efficiency to energy generating projects the business case becomes harder. The scale and capital intensive nature of such projects means that sometimes they may not be undertaken by a single business.
 
One of our current challenges is to use heat efficiently in our manufacturing process. This opens up a number of interesting opportunities but most are at a scale beyond which we would normally be comfortable committing to on a single project. To make use of all available economies of scale and reduce the business risk they would involve a degree of co-ordination between several local businesses.
 
The big prize would be a fully integrated heat and power system with other businesses but, given its scale, this is a difficult project to deliver in the current economic environment.
 
Smaller generation projects certainly look more attractive with the new Feed In Tariffs. We will be considering any opportunities they open up for us.
 
Longer term, we are aware that while our core products have a lower carbon footprint than new tyres, that benefit is not fully factored into its price to customers. Only when all such discrepancies are fully priced in will businesses be fully incentivised to go green.

Francis Clark has offices in Exeter, Plymouth, Salisbury, Taunton, Tavistock, Torquay and Truro. Francis Clark is the winner of the ‘Auditor of the Year - Mid Tier’ in the National Financial Directors’ Excellence Awards 2011, and LexisNexis Best General Tax Practice Award 2009. More information is available by logging on at our Online Information Centre