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How can businesses tackle energy price rises?

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There is a sense of imminent horror as businesses are facing substantial hikes in their energy bills. The head of the British Chamber of Commerce, Shevaun Haviland, warned, “Businesses will close their doors this winter” if they are not given support with soaring energy bills. Sadly, some have already decided to close.

Here is a range of things businesses - especially small businesses - can do to mitigate the impact of energy price rises this winter that will stave off closure.

Embrace government support

New PM Liz Truss’ energy relief package involved capping energy bills for businesses at the same price per unit as consumers for six months. Alongside capping energy bills, we should also expect VAT and business rates to be reduced, all of which have yet to be finalised.

There is also a range of government schemes including loan and grants already available that business owners can take advantage of.

The Government also offers incentives to businesses who reduce their carbon emissions and invest in green technology, which could help keep costs down.

Speak with your energy provider

Many energy suppliers will offer schemes or grants to help you improve your energy efficiency, much like the government schemes. You may be able to get subsidies on the upfront costs of energy efficient equipment, or you may be able to claim from a business hardship fund, if they offer it.

Suppliers will also be able to offer a payment plan to spread out the cost of energy bills over a longer period.

Consider switching energy supplier

If you can’t get much support from your current supplier, think about switching to another energy supplier.

One way you can look to reduce your energy bill may be to switch suppliers. Whilst there is no price cap for businesses, suppliers can offer new customer discounts, which can go some way to offsetting the increase in energy prices.

Business owners should check out price comparison websites to obtain lower prices, websites like Compare the Market, Money Supermarket and Go Compare.

Cut consumption

There are a many things business owners can do to reduce their energy bills at their place of work including:

  • Turning down thermostats
  • Using energy efficient equipment and LED bulbs
  • Installing sensors to ensure lights go off in rooms and corridors when they’re not being used
  • Turning off PCs and office equipment when not in use

Businesses can also look to install solar panels and insulate roofs and walls, and are also being advised to conduct an energy audit to identify quick and easy to make energy and cost savings.

Encouraging staff to be alert and practice energy saving is a good way way to reduce costs. Educate everyone on the importance of energy savings so they can do just that - make savings.

Talk with your bank

Banks are stepping up to support businesses manage rising costs and avoid falling into financial difficulties.

Advice and access to tools are available at major banks such as NatWest, Barclays, Santander and Lloyds.

Jurek Sikorski

Executive Director of Henley Centre for Entrepreneurship
Published 7 October 2022
Topics:
Leading insights

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