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Over half of UK’s SMEs failing to realise energy cost savings

Despite small to medium sized businesses (SMEs) seeking ways to manage the bottom line in tough economic conditions, over half have no measures in place to monitor energy efficiency, potentially missing out on major savings, according to research from npower.

The findings from the energy company’s latest Business Energy Index (nBEI) show that 53% of the 4.8 million* SMEs in the UK have no methods in place to manage energy efficiency, and nearly one in five (18%) didn’t know if they had reduced their energy consumption over the past 12 months.

This is despite figures from the report showing that where energy efficiency is being measured, 50% of SMEs reported savings of up to 10%, showing there is huge scope to make significant business savings, while also reducing carbon emissions.

Statistics from the Carbon Trust also highlight the potential for SMEs to reduce emissions further. The Trust found that SMEs have a potential energy saving opportunity of up to 20%, compared to 8% for large businesses.

Patrick Harvey, head of customer loyalty at npower, said: “This year’s npower Business Energy Index found that for SMEs, the greatest driver for increasing energy efficiency is cost, rather than the environment. This is why it is surprising that so many are still not measuring the positive impact that implementing energy efficiency measures can have on their business.

“The results of the research show the huge untapped potential for SMEs to both reduce emissions and increase savings.”

However, encouragingly, overall the nBEI found that the importance SMEs place on energy management and efficiency is at its highest level since 2005. When asked to rate the significance of energy management to their business out of 10, SMEs gave an average score of 6.7, which is up from just over 5 when the Index began.

Coupled with this, many reported to be proactively measuring their energy usage and recognising the payback of low-cost, quick-win measures such as turning equipment off, which was ranked as the most popular action over the past six months. This was followed by regularly monitoring consumption and reducing heat loss.

Patrick Harvey continues: “It is really encouraging that energy efficiency is working its way up the business agenda but there’s still a long way to go.

“More businesses need to realise that through simple to implement and low or no cost measures, they can lower their bills by around 10%. In today’s tough operating environment this is a saving that SMEs can’t afford to over overlook. This is why we’ve developed SmartStart – a toolkit and advice service which helps SMEs get energy saving measures up and running and gets them saving on their bills quickly. Smaller businesses don’t have to rely on their landlords or have a big team in place to identify and implement energy saving measures.”

*Figure from the Department for Business Innovation & Skills’ 2009 report (last available figures) – http://stats.bis.gov.uk/ed/sme/

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