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BRITISH BUSINESSES TAKE ENERGY ACTION
Britain's biggest companies are taking action to safeguard their businesses in the event of winter blackouts. The results of a survey carried out jointly by the Major Energy Users’ Council (MEUC) and Power Efficiency show that over 95% are investing in such projects as renewable energy, installing onsite generation and starting behavioural change programmes to get co-operation from employees in reducing waste.
The report - ‘Powercut Britain – Are the lights going out for UK business?’ – contains the views of 129 major commercial and public sector energy users. They include 10% of the FTSE 100 with a spend of £1 billion per annum.
The survey follows recent warnings by Ofgem that the UK generating capacity is nearly at full stretch. With the planned closure of some coal and nuclear power stations, the Regulator warned that spare capacity could fall from today's 14% level to just 4% in three years, with a risk of ‘brownouts’ and ‘blackouts’ starting in the winter of 2015-16.
Other key findings of the report are:
Initiating ‘behavioural change programmes’ (60%), investing in renewable energy sources (50%) and installing onsite generation (43%) are the top three major actions businesses are currently taking to protect security of supply in the future.
The Carbon Price Floor, introduced this year at £16 per tonne of carbon emissions, is a cost which 35% of businesses say will need to be passed on to their customers by increasing the prices of their products and services. Nearly half of the businesses polled (42%) say it is a cost which will impact on profitability but one they will need to absorb for the time being.
Over 90% of those surveyed think that energy inflation poses a major threat to UK competitiveness.
Three quarters (74%) are aware of their obligations to report greenhouse emissions in their Directors’ Report as of September this year and of EU regulations which will compel energy surveys by 2015. Conversely, one in five businesses (21%) are unaware of these obligations. Nearly half (48%) have already taken steps to comply with these obligations whilst a third (33%) say they have done nothing.
Nearly two thirds (62%) say they have a clearly defined energy and carbon reduction strategy, but a third (33%) say they do not have one.
60% say they have plans in place to make a substantial investment in energy efficiency. A third (32%) say they are considering financing an energy efficiency programme through an Energy Performance Contract (EPC) or from an Energy Services Company (ESCo).
Commenting on the publication of the report, Andrew Buckley , director general of the MEUC, said:
“The parlous state of energy supply will come as little surprise to many in industry who have watched politicians sleep walk into this crisis of their own making. Whilst the relative merits of affordability, security of supply and environmental protection will continue no doubt to feature in the run up to the next election, business customers are having to take their energy future into their own hands now, as evidenced by the results of this survey.”
Andy Wild, managing director at Power Efficiency, added: “This report highlights the complex issues facing business in the UK today and underlines why we believe the issue of energy management is moving ‘out of the plant room and into the boardroom’. It provides a compelling insight into why managing energy costs and securing security of supply will dominate the agenda of UK businesses wishing to remain competitive in the coming decade.”
Copies of the report can be downloaded here