The Energy Bill Relief Scheme for non-domestic customers has come as very welcome help for struggling businesses. Energy customers eligible for the scheme (which includes almost every organisation on a non-domestic contract) will pay a fixed price per unit, which is significantly lower than the wholesale prices predicted for this winter.
But the relief is temporary. The scheme is due to end in March 2023, with a review three months in to help determine what assistance the government should offer after this point. The government is clear that businesses should use this breathing space to come up with a long-term plan to help themselves.
“It is important that users who are less vulnerable to energy price increases (particularly larger businesses that are not energy-intensive) use the 6 months support provided by the scheme to identify measures they can take to protect themselves against high energy prices.”
Investing in price stability
Many businesses are already working to protect themselves against price volatility by moving away from conventional supplier contracts. This often means signing a corporate power purchase agreement (CPPA), committing them to buy energy directly from a renewable generator. One big advantage of this is almost always paying below market price for the energy. And, perhaps more importantly, it offers budget certainty by making the business less vulnerable to energy price changes.
Other businesses may approach the problem by developing their own renewable generation projects, either on-site or elsewhere.
Investing directly in renewables, whether through a CPPA or your own generation assets, is a welcome step towards price stability and energy security. But because of the naturally intermittent nature of renewables, it is usually necessary to manage the gap between production and consumption. The supplier managing the arrangements will almost always do this by supplementing with grid energy to keep the lights on.
This all makes sense – but when businesses don’t know exactly how much energy is in the mix supplying them, they don’t really have full control.
Data is key
At ENTRNCE we are clear that data is the key to developing a robust energy security strategy. That’s why we developed the Matcher, a tool for assessing just how well the energy consumption of your business aligns with periods of high renewable generation. It takes half-hourly snapshots of both consumption and sourcing patterns, then shares that data in an easy-to-read visual form. Many people are shocked to see the disparity between renewable production and the actual consumption of their business from half-hour to half-hour.
Having this information allows you to make better decisions on the consumption side, such as rescheduling high-energy processes for times of high renewable output. But crucially, it also allows you to make much better decisions on the sourcing side. Because the Matcher has simulation functionality, you can model the potential impact of any changes you are considering. Is the CPPA you’re about to sign really the right fit for your needs? Should you be diversifying the type of renewables you invest in? Should you be investing more in battery storage? The Matcher allows you to see how these decisions would play out in the real world, before you commit.
The government’s words are a heavy hint that businesses outside energy-intensive sectors cannot expect as much help as their heavy industry counterparts once the six-month relief scheme is over. The message seems to be that businesses who can reduce their energy use and reliance on the grid should do so as soon as possible. Energy efficiency measures and behavioural change to reduce demand are one piece of the puzzle, of course. But securing an alternative energy supply is essential for ensuring that you are protected from spiralling wholesale costs once the subsidy ends.
We are happy to offer a free one-to-one demo of how the ENTRNCE Matcher can help your business improve its energy security and protect itself from soaring costs.
For more information and to book a free demo, visit https://www.entrnce.com/match-energy-production