2020 was a challenging year (to say the least) and 2021 has not started much better and the uncertainty in global commodity prices is expected to continue. With the hope that the vaccine roll-out should allow the UK to return to some sort of pre-covid normality in 2021, the below summarises what to look out for in the utilities industry, how utilities may affect your business and tips to reduce your utility spend through 2021.
Your Purchasing Strategy
Energy commodity prices were extremely volatile through 2020 and will likely continue to be through 2021.
Now is a good time to review how you purchase your energy, more and more businesses can now access flexible purchasing contracts allowing you to spread the risk of when your energy is purchased and take advantage of market opportunities.
Green energy is now a very cost-effective solution to help you both reduce your utility spend and business’s carbon footprint.
Ensure you work with a consultant who you trust to have the best interests of your business at heart. Be wary of businesses who cold-call and present contracts which do not include fully inclusive rates, chances are these rogue consultants are inflating your rates with large commissions and you will not realise until your first invoice arrives.
Measure and understand where your utilities are consumed
‘If you cannot measure it, you cannot influence it’ turning your utilities in to a tangible cost which can be measured and reduced is not only key to any successful utility management strategy, but also one of the quickest, simplest and cost-effective ways to recognise real, tangible business savings.
If your business does not already have a half hourly meter, upgrading your meter to an Automated Meter Reading model (AMR) will provide you with actual data. For energy intensive areas more and more businesses are now installing sub-metering across their sites to measure gas, electricity and water usage to identify cost saving opportunities.
Energy Identify and Implement your ‘Quick Wins’
There is no point collating data if this is not turned into information to then implement savings. By linking all the data from your half hourly meters, automated meter readings and sub-meters to one energy management system you can make your data meaningful. Software is available which presents your data in a simplified manner allowing you to analyse patterns, compare sites and identify waste and savings opportunities within your portfolio.
Buy in from The Board
Your employees are your most important asset in reducing your energy spend and carbon footprint. Any company culture which encourages employees to pro-actively minimise consumption and waste must be driven from the top of your organisation.
We have tailored, innovative ways to sell the importance of energy waste to employees, examples include comparing energy wastage to the number of extra products a business has to sell and also comparing the cost of energy waste to the impact on business profitability and employee bonus targets.
Compliance
Approximately 12,000 companies classed as large undertakings will be captured by SECR (Streamlined Energy & Carbon Reporting) this year.
Your business will need to comply with SECR if it has two of the following: more than 250 employees, over £36m in turnover or a balance sheet total of more than £18m. Businesses which use 40MWh or less over the reporting period are exempt but will need to include a statement confirming your energy use. Public sector organisations are also exempt.
For businesses captured by ESOS (Energy Savings Opportunity Scheme), the ESOS 3 deadline is 5th December 2023 but it is a good idea to be aware ESOS 3 should be on your radar next year. Whilst ESOS is a compliance which originated in the EU we expect the UK to retain the scheme. If any changes to ESOS 3 are announced, we will be sure to keep you up to date on any changes which could affect your business.
Energy White Paper
The UK government published its Energy White Paper, ‘Powering Our Net Zero Future’ in December 2020. UK Businesses and the energy industry are impacted by the government’s 2050 Net Zero policy. Within the White Paper the government outlines plan to transform energy, drive a green recovery towards cleaner energy sources and provide a decisive and permanent shift away from our dependence on fossil fuels.
We will provide a more detailed report on how the Energy White Paper may affect your business.
Tax Reductions
Many UK businesses across most sectors are entitled to energy tax reductions or rebates.
Please contact hello@gleg.co.uk for a free energy health check which will identify any tax reductions or rebates your business will be entitled to.
How to Prepare
We understand your business is likely inundated with calls from organisations offering the ‘best’ deals and we understand these calls can sometimes be aggressive. Here at GLEG our business has grown through recommendations and zero cold calling; our business and services are built around the needs of our clients.
Our client relationships are built on trust and our single aim is to minimise your business utility spend. We are the trusted partner of our customers to manage all things utility related, allowing our customers to focus on what they do best.
Please feel free to contact hello@gleg.co.uk to arrange a more detailed discussion regarding your business utility management.