U.K. businesses taking steps to prepare for energy shortfalls


A new survey indicates that the majority of businesses in the United Kingdom are worried about the security of their energy supply, and many are already taking steps to address this.

This follows recent warnings by Ofgem that the U.K. generating capacity is nearly at full stretch. With the planned closure of some coal and nuclear power stations, Ofgem has 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.

According to the report from the Major Energy Users Council (MEUC) and Power Efficiency, 60% of the businesses have initiated ‘behavioral change programs’, 50% are investing in renewable energy sources, and 43% are installing onsite generation.

Further, nearly two thirds (62%) say they have a clearly defined energy and carbon reduction strategy, and 60% have plans in place to make a substantial investment in energy efficiency.

Over 90% of the U.K. businesses also think that energy inflation poses a major threat to the country’s competitiveness, and energy is now a boardroom issue for almost three-quarters of them.

“Doubts over whether the lights will stay on combined with the belief that energy inflation is now a threat to future business make sorry reading,” says the MEUC in its overview of the survey. “Rather than counting on gas and electricity to be both readily available and at reasonable cost to aid our recovery, it seems that uncertainties over our energy future may well be having a detrimental effect.”

However, in its overview Power Efficiency warns against an immediate knee-jerk reaction by companies, stating that getting the strategy right, and taking a holistic view of energy, is vital to the success of any energy savings program.

“We have seen businesses install onsite generation without seeing it as part of the overall objectives of an energy savings program (the savings should come first!) and as a result over investment has resulted in installations of onsite CHP and biomass which, in the end, have been built with unnecessarily high capacity.”

Other findings from the survey are:

  • 75% of businesses employ a specialist energy manager or a staff member with specific responsibility for energy efficiency
  • 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.

By Jonathan Spencer Jones