The rising cost of energy has long had an impact on business profitability; in fact over the past 15 years the compound average annual electricity price increase for a medium-sized business has been almost four percent, which is twice the rate of inflation. This is a concern for UK companies, which are currently exploring ways to reduce reliance on fossil fuels.
In response to these concerns the PA Consulting Group has released a report, advising UK businesses on how best to avoid being hit by this increase in energy prices. The advisory document, entitled How Businesses can Shelter from the Gathering Energy Storm, outlines four key areas of opportunity including energy efficiency investment, smart energy, demand-side management and adopting a crisis mindset.
Mark Livingstone, PA Energy Expert, comments: “Expect forward thinking energy suppliers to introduce new innovations that will provide further opportunity for saving. Really understanding your energy use, and smart ways of changing, holds the key to reducing costs.
“Today some industrial customers have contracts with their electricity suppliers that give them a price break in exchange for offering the flexibility of reducing load in times of pressure. In the future, expect this capability to extend much further as smart energy and electricity market reform increase the incentives on offer.
“As the future storm clouds gather, there are opportunities that today’s business leaders can turn to their advantage and make a difference to a company’s profitability,” he concludes.