ENVIRONMENTAL AWARENESS How to become more energy resilient
Energy is a hot topic for businesses. In fact, according to the latest npower’s Business Energy Tracker report, energy is the top risk that businesses are facing for the second year in a row, and it is now a board-level issue for more than 90% of the large organisations surveyed. Anthony Ainsworth, chief operating officer at npower Business Solutions, offers some advice to businesses
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t’s not difficult to see why. The volatile wholesale energy market has continued to bring uncertainty and high costs to UK businesses. Last year, gloomy forecasts resulted in an unprecedented intervention from the government in the
form of the Energy Bill Relief Scheme (EBRS), a six-month initiative to help businesses navigate the winter. However, with the EBRS being replaced by the Energy Bills Discount Scheme (EBDS) on 1 April 2023, which is a lower form of support for most businesses, in this year’s Business Energy Tracker, we wanted to further understand the impact the energy crisis has had on business attitudes to energy, sustainability and investing for the future. This in-depth piece of research, produced with support from the Major Energy Users Council (MEUC) and Energy Intensive Users Group (EIUG), gathers the voices of over 100 large UK organisations. The results reveal the impact energy volatility is having on business confidence. More than one in five (21%) said that they had seen the cost of energy for their business rise by more than 50%, with one in 20 reporting a rise of more than 100%. And, when it comes to forecasting the next 12 months, almost three quarters (72%) of businesses anticipate the cost of energy to keep rising, with one third (36%) saying they believe it will increase significantly.
Sustainability is now an important way to manage risk
As a result, the research showed that businesses are becoming increasingly proactive when it comes to managing energy risk, with net zero and sustainability investments recognised as a crucial way to take control and mitigate the risks posed by the volatile energy market. In fact, sustainability measures are now the top investment priority for businesses - up from second place in 2022 - with almost two thirds (60%) of respondents saying it would be their number one priority this year. It is clear that businesses recognise the increased resilience these measures can bring, while also contributing to their overall decarbonisation targets.
So, what actions can businesses take to give themselves greater control of their energy spend and become more resilient?
1.Get to know your energy data
Understanding exactly where and how you are using energy is crucial to reducing both costs and carbon. The Business Energy Tracker showed that use of smart energy management tools saw an increase compared to 2022, with 56% of businesses implementing this measure, compared to 48% last year. To help assess the most suitable path to Net Zero for your organisation, our Net Zero Calculator, an easy-to-use, interactive tool, provides businesses with insight into where and how you currently use energy, what impact your sustainability projects are already having, and then the best measures for the future. This means you can plan an effective and sustainable energy strategy.
2.Maximise energy efficiency
The Business Energy Tracker showed that energy efficiency remains the top way to manage risk, with nearly two thirds (61%) of businesses saying they were implementing this measure, up from 58% last year. After all, the less energy you use, the less you will pay. The capital that this ultimately saves in
reduced energy costs can be used to finance investment in further energy-saving or low- carbon technologies.
3.Become more self-reliant and energy resilient
The results of this year’s Business Energy Tracker showed an increased willingness from businesses to invest in sustainable on-site generation, such as solar photovoltaic (PV), wind or combined heat and power (CHP). Last year, just over one in four (27%) businesses said this was in their plans - 2023 sees it rise to over a third (36%), with solar PV the most popular solution. It’s easy to see why - as well as making your
organisation less exposed to the fluctuations of the wholesale energy market, it also helps your business to reduce carbon emissions, lower energy costs and provide an increased stability of supply.
4.Understand how the energy market impacts your business
Understanding the wider factors that impact both commodity (energy supply) and non-commodity costs (such as industry charges) and how this ultimately affects what your business pays, has never been more
28 BUILDING SERVICES & ENVIRONMENTAL ENGINEER JUNE 2023
important. We have developed simple-to- follow guides that can help you navigate the complex energy market, which can be accessed here.
5.Investigate eligibility for relevant government benefits
While businesses have recently been able to access the EBRS and now the EBDS to help protect them from rising wholesale energy prices, there are other schemes that they could be eligible for to help them reduce demand. For example, businesses can claim capital allowances when they buy energy efficient, or low or zero-carbon technology for their business, such as zero emissions vehicles. More information on these can be found on the government website.
Does policy need to change?
However, for businesses to have the confidence to invest and press ahead with their sustainability plans, the right policy must be in place. With the former Department for Business,
Energy and Industrial Strategy (BEIS) being split into four new sector-focused entities, including the Department for Energy Security and Net Zero (DESNZ), we also wanted to find out what businesses wanted to see in terms of energy policy. An interesting finding is that businesses would welcome more than just reductions in their energy invoices. Three quarters (75%) of respondents would like to receive incentives to reduce their overall power demand through energy efficiency initiatives, while 60% would like more support in switching from fossil fuels to renewable alternatives.
Towards a more sustainable and secure future
Without doubt, the last 18 months have hit businesses hard, and will have a lasting impact. However, while measures such as the EBRS and the EBDS are welcome interventions, a focused and long-term approach is needed to enable businesses to reduce energy demand and improve their energy efficiency. That said, there are additional steps businesses can take right now to help them to reduce energy costs and carbon emissions, as well as support the UK’s net zero goals. For more information, and to download a copy of the Business Energy Tracker, visit
https://npowerbusinesssolutions.com/ businessconfidence
Read the latest at:
www.bsee.co.uk
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