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Is your business paying too much for energy?

Is your business paying too much for energy?

Is your business paying too much for energy?

Paying for the energy required to run an office can be a substantial overhead for businesses, particularly small and medium-sized enterprises (SMEs).

There are various actions any firm can take to manage this cost - maximising energy efficiency being one of them - but research has indicated that many companies are not being vigilant or proactive enough on this front.

Comparison site Love Energy Savings released a report suggesting that eight out of ten SMEs are paying too much for power. This follows on from figures released last year by the Competition and Markets Authority showing that the majority of these firms are still on standard tariffs.

The site encouraged businesses to take action on their energy bills and look for the cheapest provider, rather than being automatically rolled over onto more expensive deals.

All six of the UK's major energy suppliers - British Gas, E.ON, Scottish Power, npower, EDF Energy and SSE - have increased their standard tariff prices this year.

The average annual cost of dual-fuel standard tariffs from these providers is estimated to have risen by between seven per cent and ten per cent, with the possibility of further hikes this winter.

Love Energy Savings also found that it is not uncommon for SMEs to be charged more than bigger businesses.

Phil Foster, the comparison site's managing director, said action is needed to prevent "profiteering" by the biggest energy companies at a time when wholesale prices are falling.

He said it is "more important than ever" for firms to review their energy costs and make sure they are on a contract that "is working for them".

"That bills will continue to rise is becoming increasingly inevitable and failing to review your bills and find a tariff that offers you the best value for money can have a significant impact on your business's bottom line," Mr Foster continued. "The gap between the 'Big Six' companies' fixed price deals and their standard variable tariffs has already widened by more than half since November."

Do businesses need to overcome fear of change?

There are many positive changes businesses can make to improve their energy efficiency and consequently save money. However, identifying and actioning these changes can sometimes be a big challenge.

According to Love Energy Savings, there are many barriers to business efficiency, such as reliance on certain processes and resources, overconsumption of resources and a lack of balance between use of resources and productivity. But it's possible that one of the biggest barriers of all is fear of change.

The comparison site offered a number of tips that could help companies to overcome this concern and enhance their efficiency. It recommended being very open and communicative with staff, to reduce the risk of change being overly unsettling.

"By communicating your strategy, you can alleviate any fears your employees may have as well as reduce your own," Mr Foster advised.

Businesses looking for ways to improve their energy efficiency were also encouraged to focus on the advantages of change, rather than the potential drawbacks and hindrances.

 

Posted by Julie Tucker