Partner Article

Energy expertise could help businesses make savings

Medium size businesses are missing out on significant energy savings by failing to have properly trained staff in place to procure energy.

Despite spending an average of £180,000 on energy each year, only 4% of medium-sized businesses have a dedicated energy specialist. For almost all businesses with this type of employee in place, almost 90% said that it had saved their organisation money.

In their ‘Energy Matters’ report, npower found that only a fifth of all businesses have a formalised energy strategy, while more than 80% of those responsible for procuring energy spend more time on administration that procurement.

Wayne Mitchell, industrial & commercial markets director, npower, commented: “The research found that the person responsible for buying energy can have a significant impact on a business’ revenue yet the importance of this role is undervalued across the UK.

“Businesses are missing a trick when it comes to having a positive impact on the bottom line by not positioning energy as a board level concern and having a strategy in place to manage its procurement.

“This is despite findings from our previous research which showed that medium-sized businesses rank energy as the second highest business risk they face, above cash flow, legislation and security.”

More than half of the businesses surveyed felt that energy purchasing is not a valued role in their organisation, and less than one in 10 has received any kind of forma procurement training. This means that more than 25% of respondents have remained on the same contract because they haven’t had time to review it.

In those businesses that do have a dedicated energy specialist the picture was very different. As well as saving their businesses’ money, it was in this role that the most amount of time spent was spent on energy purchasing, the presence of a formalised energy strategy was highest and the value placed on the role by the business was felt to be above average.

Mr Mitchell continues: “With office managers – not energy specialists – accounting for the majority of those responsible for energy procurement in medium-sized businesses it is easy to understand why the role can be undervalued, as these people will be juggling a wide variety of tasks to keep the business afloat.

“Through better managing energy procurement, costs can be kept to a minimum by ensuring energy is purchased at the correct times - namely avoiding peaks in the market - and with a little knowledge businesses can take control of this themselves.

“Anyone wanting to find out how should source this advice from their supplier and act now to start saving.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .