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Energy Efficiency and the SME: The Time to Act is Here

SME newsThe next front in the war on energy costs is getting the UK’s SMEs to take energy efficiency measures seriously as a key plank of their business strategy, that is according to a recent Guardian seminar on business energy costs.

Such a proposition is unlikely to be attractive to all but the most committed environmentally aware businesses.

However with carbon reduction targets due to fall upon the country’s smallest businesses, their achievement of such goals could become the difference between profit and loss very quickly.

For all the talk of ‘spiraling’ costs, the business energy market, unlike its domestic sister, offers market based pricing opportunities and as a result enables businesses to always be in a position to strike an advantageous deal. Engagement is the key.

Still however engagement is too low and far too many businesses are missing out on savings that flow directly to their bottom line.

It is this low level of engagement that worries many with regards the take up by small businesses of energy efficiency measures.

One of the key issues according to the Federation of Small Businesses (FSB) is too much choice and not enough trust with regards the organisations offering ‘help’ with such schemes.

According to Mike Cherry, National Policy Chairman at the FSB there are over 800 separate sources of energy advice for small businesses from central and local government a situation that requires drastic streamlining.

Cherry said:

“Give us [small businesses] a one-stop shop to make it easier to see what is available and give clear indications about how to go about it.”

Cherry also said that SMEs find business energy suppliers lack transparency regarding the energy contracts available to them and the errors inherent in estimated bills:

“The issue that our members tell us is holding back growth, to some extent, is around cost-effectiveness and energy costs. We don’t believe that the energy companies and providers are giving enough information and advice to small businesses on what can be done to reduce consumption”

In addition Cherry called for more information regarding the Green Deal and the new European Energy Efficiency Fund:

“It is good that they stimulate thought and consideration of the issues, but where it is unhelpful is where it is imposed without giving help and support”

Richard Rugg, Managing Director of Carbon Trust Programmes, one of the government’s 800, supported the potential revolution for SMEs that energy efficiency measures could bring saying:

“You need to understand your energy consumption and bills. You need to be monitoring your energy and understand what the opportunities are of getting rid of inefficient technology and replacing it with efficient technology, although it will cost you in the short term.”

Guy Porteous, a director of Dancol Solutions, supported the benefits of energy efficiency and pointed to a more prosaic and frankly attractive boon, saying:

“If you reduce energy consumption by 20%, it is equivalent to a 5% increase in sales, so is that boring?”

Indeed the costs of implementing efficiency measures in businesses need not be high in terms of either outlay or time.

One of the most practical steps that businesses can take to cut energy usage and therefore costs is replacing standard lights with LED versions. Taking two businesses as an example:

  • 4D Data Centres, replaced 192 fluorescent lights with LED tubes and halved its lighting bill overnight.
  • Toni & Guy, Solihull, replaced myriad traditional downlighters in the salon with LED spotlights and the savings in excess heat generation and cost reduction were immediate.

However still too few businesses realise the potentially simple steps that can transform their energy usage levels, reduce costs and critically enable them to be pre-prepared for centralised and commercially set energy efficiency targets.

To find out how easy such measure can be for businesses to adopt visit our energy efficiency for businesses guide here.

The last word goes to the Guardian who in their coverage of the seminar delivered a stark warning on not curtailing energy use within businesses:

“If energy prices keep rising at current rates, some small businesses wonder whether they will still be economically viable in 10 years’ time”.