I thought the answer to this question would be an obvious yes. Since the pandemic hit, I’ve read about dramatic drops in company energy use and seen first hand the massive drop in traffic. All that corresponding gasoline for commuting, energy for office heating, lighting and cooling – that has to be having a huge positive impact, right?. Well, it turns out that like most things environmental, it’s complicated and it depends.

If you are a company with a large population working from home, your own emissions have likely dropped significantly. So have your energy bills. The most recent research in June showed that companies have saved nearly $9 billion in energy costs during the pandemic.

The problem is that energy is just moving over to your employees – and their use is actually up by $12B, with a net increase of 1% in total usage. Compounding the issue is that employee energy is less likely to be from renewable sources, particularly if they work for a larger, more progressive employer on climate.

Opportunity Cost of Working From Home

But shouldn’t the benefit of the reduced commuting offset that increase? The IEA researched this in gory detail and the answer: it depends. If an employee commuted less than 3.7 miles or took shared transportation (carpool, public transit), then the increase in home energy is higher than the reduction from the commute. But if the employee drove alone in a car for more than 3.7 miles, then the commute benefit was greater than the home energy increase. It also depends on how often employees work from home. If everyday, then the employer can reduce footprint or shutter entire floors as they did in the earliest days of the pandemic. If it’s a mix, they can’t. The most comprehensive review of all of the research concluded that “part-week teleworking could lead to a net increase in energy consumption.” If you’re curious about your situation, a new hybrid workplace calculator can model various scenarios.

Now there are many other benefits to working from home so I’m not advocating that we all go back to the office. But companies who care about their footprint, particularly those who have set carbon neutrality or 100% renewable energy goals, need to care a lot more about their employee footprint at home.

Corporate Action

Some companies are tackling this directly. Zapier and Mcdonald’s are measuring and offsetting their employee footprint. Goldman Sachs is offering employees a way to purchase renewable energy at home. Many of WeSpire’s customers are running efforts to help employees reduce their personal footprint. We are also adding greater measurement and offset capabilities. Another debate is about the cost of energy and whether employers should be subsidizing the increase in usage. For the average employee, it’s been about $60 per month but in high cost states like Connecticut, the increase has been as high as $200 a month. Should employers cover that? In some states, like California, it’s required. In most states, it’s not.

While many return to office plans are shifting due to the Delta variant, the pause can lead to more strategic long-term decisions about hybrid work. Should in-office/out of office days be coordinated to improve collaboration and enable closing off entire floors or buildings? Should less-used commute benefits be replaced or supplemented with home energy benefits? Should rewards be able to be used for offsets? At a bare minimum, companies should start by measuring employee footprint because ultimately, you can’t manage what you don’t measure.

Quote of the Week: “Strategy is about making choices, trade-offs; it’s about deliberately choosing to be different.”

Michael Porter