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Businesses warned to increase energy resilience

Businesses warned to increase energy resilience

Businesses warned to increase energy resilience

Many businesses in the UK are failing to adopt an energy resilience strategy, claims a new report.

Research from Centrica Business Solutions suggests the average UK mid-sized firm could be risking £2.8 million per year in potential opportunities and damage.

The Resilience Report gathered information from more than 300 enterprises across the UK to assess how they are prepared for possible energy problems.

 

Many senior energy decision-makers estimated the cost of a serious energy failure would equate to around seven per cent of their annual revenue. However, the figure is estimated to be considerably higher, with even temporary blackouts costing firms around 17 per cent of yearly income. 

There are concerns some businesses are failing to have significant procedures in place to prevent financial losses and overall perception of their brand. The report estimates those firms with an effective resilience strategy are 13 per cent more likely to have a good brand reputation and 34 per cent more likely to financially perform well. 

It was clear energy resilience was a key issue for UK industry, with 88 per cent of organisations polled saying it was important, while 58 per cent recognise it is now critical for businesses to have correct policies in place, especially as 52 per cent believe they are likely to experience some form of energy problem over the next 12 months. 

However, a number of businesses are neglecting to adopt a formal approach to energy resilience. Just 18 per cent were found to have an official procedure currently in place, with 32 per cent admitting they have no appropriate strategy regarded the issue.

Centrica’s study also discovered eight out of ten of those firms surveyed had experienced at least one incidence of energy-related failure over the past year. As a result, around one in four businesses had suffered some form of damage to equipment.

Alan Barlow, UK director of Centrica Business Solutions, explained despite many businesses being aware of the growing changes regarding energy, few have taken steps to protect themselves from potential harm.

He added: "There are reputational and financial benefits to an energy resilience strategy so it’s important that organisations make the right investments and take steps towards implementing a strategy. Back-up power systems provide protection against power outages, and batteries can provide energy in less than a second, mitigating the risks of temporary brown-outs.”

The government and industry regulator Ofgem recently outlined plans to give businesses more control over their energy consumption in a bid to reduce costs and allow organisations to take a more flexible approach to how they consume and store energy. Such measures may prove useful in enabling firms to increase their energy resilience, as well as enabling suppliers to provide more innovative energy solutions.

 

Posted by Julie Tucker

Image courtesy of iStock/Natali_Mis