Over the past few months and years, uncertainty has loomed large in the background of both the UK and global economies. From the impact of COVID-19 to Brexit's ever-present ambiguity, the pressure for organisations to better control their finances is most certainly on.
As a result, there has been a greater awareness when it comes to cost-saving solutions, along with an increase in brokers and consultants promising to help businesses make their money go further. Likewise, with a greater need for social responsibility and environmental targets for organisations to achieve, a spotlight on sustainability has come into focus perhaps more than ever – with businesses refining their energy management strategies accordingly.
Recent research goes some way to showing what businesses are prioritising with regards to energy. A recent SEFE Energy survey of 216 energy decision-makers working in UK companies reveals how these businesses buy and manage their respective organisation's energy. In this article, we'll delve into the report to examine its findings in greater depth.
Energy as a strategic priority: a key focus for many businesses
Our report found that energy, including finding the right supplier, is now a key focus for many businesses, one that requires careful consideration and involvement from multiple departments and internal stakeholders.
A glimpse at the results shows the following:
Additionally, nine out of ten decision-makers weren't satisfied with how their business currently treats the topic of energy, preferring it to be a greater priority. More involvement with senior managers was viewed as a key progression to drive down costs and spearhead innovation.
A move towards more environmentally-conscious practices
The second most important business challenge amongst those surveyed, sustainability and environmental pressures are high on the agenda for many organisations.
More eco-friendly initiatives have flourished of late, with 96% of businesses predicting that environmental factors are going to continue to shape energy management over the next two years. Sustainability scored highly as something that informs current strategy, with 85% stating its importance.
Green credentials have also been seen as playing a major role in a business' brand and reputation; two-thirds of the organisations noted an increasing move towards more eco-friendly approaches. But how have such businesses been demonstrating their green credentials? Renewable energy, cited by a quarter of those surveyed, proved popular; providers that supply reliable energy while minimising carbon emissions too, are an inviting proposition as a result.
Thus, those involved with buying are becoming more and more conscious of energy regulations that demand greener practices. Of the current regulations, the following were noted as playing a large role in future energy management strategies:
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The impact of technology on energy management
A massive 93% of businesses mentioned that technology, as a means to bolster innovation and efficiency, will impact their energy management over the next two years. Energy procurement, in particular, was felt to benefit from incoming tech, while 23% of businesses felt that modern innovations would help with trading as part of a flexible purchasing agreement.
Smart meters and automated meter reading also stood out, with 45% of businesses citing them as the main means of improving energy management. This was also reflected in the large number of businesses' (97%) awareness of the smart meter roll-out set to come into play in 2024.
However, as promising as the technology landscape looks to some businesses, to others it presents a challenge. Over a third (38%) of organisations felt that while they understand the importance of vital energy information, they simply didn't have the technology to access it. Such issues aren't always down to cost but can also be the result of faulty equipment not working in the desired way.
Fluctuating energy prices: the big concern
Perhaps the largest issue highlighted by the study came in the form of changing energy prices. For energy managers, outside factors are always a problem when it comes to fluctuation, but in these uncertain times, it's perhaps a greater risk than ever to an organisation's energy supply, as the below results show:
Differing industry sectors: attitudes and approaches
Unsurprisingly, there were differences across industries in how they approached their energy use. The most notable variances include the following:
Despite 79% of manufacturing firms taking steps towards more eco-friendly energy, those surveyed felt they needed more help. 32% felt that their suppliers could offer green or renewable products to aid the move towards environmentally friendly practices.
Technology could lead the way
24% of retail energy buyers believe energy could be improved through technology designed to provide greater transparency on energy consumption, especially since many have to buy and administer gas and electricity for a variety of stores across the country.
Such a variance in retail estates poses a challenge. 61% felt that managing energy more effectively across these different sites could be achieved through technology that simplifies the process.
Tackling climate change
The public sector is another industry facing pressure to improve their environmental efforts, according to 52% of those surveyed, with 24% feeling that their awareness of green solutions offered by suppliers was limited.
Countering energy supply risks – what are businesses doing?
The results of the survey were certainly encouraging with regards to countering risks. Over half of the businesses we surveyed are either already on their way to reducing risk, or have at least made plans to do so in the next 12 months.
Steps to mitigate energy supply risks
Percentage of businesses already doing this
Percentage of businesses that plan on doing this in the next 12 months
Improving supplier/management service
Managing down consumption to reduce restrictions
Improving cyber security measures
Investing in innovation to reduce consumption
Improving forecasting on energy use
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The views, opinions and positions expressed within this article are those of our third-party content providers alone and do not represent those of SEFE Energy. The accuracy, completeness and validity of any statements made within this article are not guaranteed. SEFE Energy accepts no liability for any errors, omissions or representations.