November 2005
Energy Efficiency – Can Auditing Or Campaigns Tackle Rising Bills In SMEs?
Small and medium sized enterprises (SMEs) use around 50% of the total UK business energy, costing more than £6 billion a year. With energy prices rising, that expenditure may dent competitiveness unless energy efficiency measures can reverse the trend.
The Environment Chairman at the Federation of Small Business, John Holbrow, said in October: "Small businesses are suffering owing to the huge energy price rises of the last 12 months. Our members need help in understanding what they can do to help cut energy usage and reduce their bills."
The Carbon Trust, the UK body to help business and public sector organisations cut carbon emissions, recognise that more than £1 billion a year is being haemorrhaged by SMEs due to energy waste.
Energy Price Rises and the role of Energy Audits
An EEF survey of 371 companies published earlier this autumn found that 93% had experienced an increase in energy prices over the last twelve months. These rates are more than double the level of increases in 2004 and 80% of those surveyed expected the cost to increase further in the next twelve months.
The survey highlights that companies are responding to these increases in a number of ways, in particular by looking at how they buy energy and by pressing ahead with further energy efficiency measures.
- 60% of companies that had experienced energy price increases have either changed or investigated changing their energy supplier.
- Over half the companies had carried out an energy efficiency audit and most have followed up the audit with energy efficiency investments. However, the figure was 40% for companies with less than 50 staff.
Virtually all the companies in the EEF survey who had carried out an energy audit found them to be beneficial, with savings identified and actioned.
Campaigning for Energy Efficiency
However, the EEF survey highlighted that attempts by smaller companies to improve their energy efficiency are being hampered by a lack of engagement with the agencies set up by government to deliver guidance.
In particular, companies are excluded from a free energy survey by the Carbon Trust if their energy bills are less than £50k. EEF believes that all firms should have access to this publicly-funded facility.
“What we need is a service where smaller firms can get help with energy auditing and energy management in general, said EEF environmental advisor Wendy Stephenson. “At the moment there is nowhere to go.”
She said, “the Carbon Trust did run a pilot programme with the Energy Saving Trust for users with annual bills of £10k to £50k but they made it clear they weren’t saving enough CO2.”
The Carbon Trust suggest that, in many cases the bespoke advice from experts working on its telephone helpline was sufficient.
This month the Carbon Trust launched a nationwide advertising campaign called ‘Lifeblood’ aimed at making British businesses become more energy efficient. It highlights the fact that British small business is wasting as much as 30 per cent of its energy; an average of £7,000 per business.
Dr Garry Felgate, Director of Action Energy from the Carbon Trust, said: "Put simply, energy is the lifeblood of British business. Without it a business could not operate. This campaign uses powerful images to show SMEs just how much energy they are wasting, something which directly affects their bottom line. Even simple measures, such as insulating a roof space or lowering office temperatures by just one degree, can significantly reduce heating bills. We hope that this new campaign will drive many more small businesses to take action and save money".
Dr Felgate recognises the position of SMEs. “SMEs face very difficult barriers. I can relate to this as the Carbon Trust is itself a small business and we know that finding time to focus on energy is a real problem. However, rising energy prices will result in increasing energy costs unless businesses do something about energy usage now.”
If you are interested to discuss energy management or specific energy efficiency measures, contact Steve Stones on 024 7632 3260.
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