Supple supply

Energy looks set to be a major campaigning issue for next year’s general election with Labour leader Ed Miliband pledging to fix prices if voted in.

Dwindling resources, an ongoing battle over renewables subsidies and the controversial structure of the supply market have seen energy prices soar in recent years. The number and complexity of deals on offer are rapidly increasing.

In this context, householders can be forgiven for being confused and concerned about their energy supplies – but manufacturers simply have to get on top of the situation if they want to thrive in the new era.

“For many manufacturers, energy has always been one of the main cost factors in production,” says Dale Marriott, head of UK at energy supplier Gazprom Energy.

“The cost of energy has been steadily rising over the past few years, and this is set to continue as the UK undergoes a project to future-proof its power generation. As a result, energy procurement will become an even higher priority for UK manufacturers of every kind.”

The simplest way to cut your bill, of course, is by using less energy. This may sound obvious but many companies stop short of truly minimising their usage.

Jonathan Akers, head of energy consultancy British Independent Utilities (BIU), says: “Manufacturers need to look at lighting, especially in warehouses, and also variable speed drives are an obvious choice.

“Heating and cooling processes need to be checked to ensure that energy is not wasted in the preparation process and lost rather than reused.”

Marriott says manufacturers should check the performance of process equipment.

“In many cases, investment in replacing out-dated or worn-out assets with newer and potentially more efficient technology can be justified by medium-term reduction in energy costs,” he says.

“For high-volume manufacturers, the pay-off time for energy efficient equipment will continue to get shorter.”

A spokesman for Energy Team says the West Sussex-based consultancy advises clients to commission an onsite energy audit as a starting point for minimising their outlay.

Recommendations from such an audit may include implementing specific staff awareness campaigns or installing efficient lighting. These can make a real difference, but are only part of the journey.

“At the end of the day, there is only so far a business user can go with reducing consumption,” said the spokesman. “Goods and services still have to be produced.”

To bring down costs further, manufacturers can look at the times of day they buy their electricity.

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