energy security Archives

Government energy support scheme announced for businesses

Posted on 14th September 202214th October 2022 by Leila Zerai

Update: The government released an update for the Energy Bill Relief Scheme on the 10th of October.

The following are some of the newly introduced changes that are being made to the scheme:

The government has expanded the Energy Bill Relief Scheme. Expansion of the scheme means that customers who signed contracts at the end of last year or the first quarter of this year are now covered.
Relief can be claimed on selected dates where wholesale energy prices were extremely high for fixed contracts signed between December 1st, 2021, and 31^st March 2022. Previously, this was only applicable to contracts signed on or after April 1st, 2022.
There’s a new requirement on suppliers to ensure the price customers pay does not fall below the government-supported price of 21.1p per kWh for electricity and 7.5p per kWh for gas. This means when wholesale costs, network costs, environmental levies, and supplier margins are all factored in, the price customers pay (known as the ‘effective retail unit price’) cannot fall below the government-supported price.
The Climate Change Levy and VAT can, however, be added on top of these costs.
For those customers on flexible purchase contracts, the government has confirmed further details will be released shortly.

The original blog post from September 14th can be found below.

Business energy consumers will receive financial support from the government, under a new 6 month energy support scheme, in response to the current energy crisis.

The government has said that non-domestic energy users will be offered an equivalent Energy Price Guarantee, as is currently being offered to domestic consumers. This is due to concerns that non-domestic consumers have been overly exposed to rising energy prices, without the benefit of the Ofgem price cap.

The Energy Price Guarantee for domestic consumers is set to replace the current energy price cap, and limits the amount of energy that suppliers will charge. The savings will be based on usage. This should lead to a typical UK household paying on average £2,500 a year on their energy bills for the next two years. The new support scheme for non-domestic consumers should result in similar savings.

The scheme for non-domestic consumers will be reviewed after 3 months to see how it is progressing and to consider where it should be targeted, to ensure those most in need receive support. After the 6 months have passed, only those industries considered to be ‘vulnerable’ will continue to receive support.

More information about the government scheme for businesses can be found here.

More broadly, the government has also set up the Energy Supply Taskforce, which will negotiate with energy suppliers with the aim of lowering wholesale costs. This is the main factor behind the current energy crisis. The Taskforce has already begun negotiations with domestic and international suppliers to agree long-term contracts that reduce energy prices and increase the security of supply.

How can EIC help?

At EIC, we understand the pressures that businesses are currently facing, as the energy crisis continues to wreak havoc on the economy. Our years of experience, and expert traders, can closely monitor the markets to find the best energy deals for you. Whether you are currently on a fixed or flexible contract, or looking to switch, we are well-versed in smart energy procurement. Our dedicated team are on hand – saving you time, and money.

Get in touch today to find out how we can help you with your bills during the energy crisis.

Energy security a key concern in Europe, and green energy will pay the price

Posted on 8th September 20226th September 2022 by Leila Zerai

We are in the midst of a dire energy crisis, due in large part to the ongoing Russian invasion of Ukraine – pushing wholesale gas prices up to astronomical levels.

As a result, energy security has never been more precarious. European nations are particularly reliant upon Russian gas supply, and Russia has just switched off the Nordstream 1 gas pipeline, sounding the alarm across Europe.

It is therefore understandable that Western nations are jittery about the state of energy security. But recent murmurings have suggested that countries are now putting green energy on the backburner, as their concerns over energy security takes precedence.

A recent survey by the World Energy Council has revealed the opinions of nearly 600 leaders working in the energy sector worldwide – and there is a marked decline in optimism regarding the pace of the energy transition. 44% of those surveyed felt that the crisis will slow the pace of the energy transition away from fossil fuels towards nuclear, hydrogen, renewables and storage. The report says that there has been a dramatic shift in policy focus, reprioritising energy security over affordability and environmental sustainability.

But what role does green energy have in navigating the current energy crisis? Is it a luxury that can’t be afforded during turbulent times? Or could it be the solution to our dependence on fossil fuels, sheltering us from geopolitical trouble?

Whilst the rise in electricity prices was due in part to lower than average wind generation, countries with a larger production of wind and solar electricity – such as the U.S. – have managed to avoid an electricity crisis. Countries such as Singapore, on the other hand, which derives only 1% of its total electricity from wind and solar, saw its wholesale electricity prices rise six times in November 2021.

It stands to reason, then, that greater investment in renewable energy can help to reduce reliance on fossil fuel energy and electricity. Unfortunately, the knee-jerk reaction is to focus on conserving as much fossil fuel reserves as possible, and to turn away from renewables. But diversified resources would ensure less reliance on fossil fuel supplies, making those countries less vulnerable to geopolitical challenges such as the current Russia-Ukraine crisis. Indeed, the current energy crisis has only served to highlight our worrying dependence on fossil fuels, and it is a shame that it has taken such unfortunate circumstances for a closer assessment of the current energy landscape.

The IEA conducted an analysis in May 2021 suggesting that greater investment in renewables, clean energy and clean technologies could help reduce demand for fossil fuels. They predict that, to reach net zero emissions by 2050, annual clean energy investment worldwide will need to more than triple by 2030 to around $4 trillion. Much of the anticipated clean energy innovations are still at demonstration or prototype phase, and will need to be brought to market soon, to meet net zero targets.

Expansion of renewables deployment requires zero fuel cost – the costs are the installation and operation costs. With the correct market mechanisms, energy prices could be stabilised easily. Onshore and offshore wind, solar and hydropower could deliver around a third of the cost of generating electricity using gas. This could lower the UK’s electricity bill by around £8.9 billion annually.

The situation on the ground though, particularly for small and medium sized businesses, is much more immediate. With the energy crisis turning into a cost-of-living crisis in the UK, and the very real possibility of an economic recession, businesses are desperate to stay afloat and keep their energy costs down. Renewable energy is, unfortunately, less of a concern under the circumstances. But you should take into consideration the fact that energy efficiency options and carbon compliance could go some way towards minimising and controlling your costs.

How can EIC help clients with their energy contracts during the crisis?

At EIC, we understand the unprecedented pressures that businesses are facing, as the energy crisis takes hold. We know that our clients on fixed term contracts are currently looking for alternative ways to procure energy. Many who may have previously considered it too risky, are now looking to flexible procurement as an alternative. But suppliers are now being more selective regarding the type of client they take on to a flexible contract. Energy volume requirements, the number of sites and credit status all play a part in their choices.

We recommend that you have an initial chat with us, to consider your options and decide how to put an energy strategy in place – so you can ride out the volatile market.

You should also bear in mind that carbon compliance is mandatory, and there can be repercussions if you do not comply, including financial penalties and loss of reputation. So it is always a good idea to take steps towards best practice in carbon compliance, as soon as possible.

Finding the best available option is a time consuming and specialised process. We make use of our specialised skill set, and years of experience, to manage your energy procurement during this turbulent time. We can also search for the best green deals, and help you to meet your carbon compliance requirements, so you can focus on your business.

Get in touch today to find out more about our energy procurement and trusted compliance services.

Could your organisation benefit from onsite generation?

Posted on 24th November 2020 by Josh Ellison

Access to clean electricity is becoming increasingly important for UK businesses. Onsite generation can provide a source of clean energy, whilst also protecting firms from supply chain disruptions and market changes. We break down the major benefits of generating your own electricity, as well as the advantages it will grant businesses on the road to net zero.

Onsite generation: What do you have to gain?

The immediate boons of onsite generation fall under three categories: energy security, increased flexibility, and a heightened reputation for corporate social responsibility.

Energy security

Energy security can be defined in two ways; the first is the physical security of the resource reaching your business from supply. Fortunately, UK supplies are relatively undisturbed by inclement weather conditions compared with other regions of the world. Despite this, any total loss of energy – no matter how brief – can be costly. This can be avoided by having a safeguard like onsite generation in place.

The second security threat refers more to the commercial landscape than the physical one. Energy wholesale contract prices are subject to change at the best of times. Depending on a variety of factors like peak demand times, supply chain disruption, or, in the case of big oil earlier this year, complete loss of demand.

2018 was a stark example of how sudden and dramatic these price changes can be. In just a six-month period, between March and September, winter electricity contract prices increased by over 40%.

The fact is that the majority of this price hike was due to non-commodity costs like transmission and distribution. These are practically absent when generating onsite, meaning you are less at the mercy of market changes.

Increased flexibility

As with supply security, onsite generation gives you greater control over all aspects of your energy usage. You can scale back your reliance on the grid during high-generation days and, when combined with your own battery storage, even remove your dependence on the grid completely. In a way this gives you the best of both worlds. It removes your attachment to swings in the market but allows you to use the grid as a safety net for low-generation periods.

UK manufacturing has already seen huge gains by combining generation and battery storage technology. A 2018 report from CBS indicated that this sector alone could save over £500m annually by adopting such systems.

Installing your own generation equipment also makes it easier to scale and budget your energy needs as your business grows. Moreover, it improves the value of your business real estate by turning passive roof space into an asset.

Improve your green reputation

Corporate social responsibility is climbing the priorities list of commercial businesses. Onsite energy generation is an excellent way to demonstrate your commitment to reducing your carbon footprint. It also shows your allegiance with a growing section of the energy industry – one that will be centre stage for the global fight against climate change.

Additionally, most UK firms will be required to uphold TCFD standards of reporting the potential risks climate change poses to their functionality. Potential investors will feel confident knowing that you are not only bolstering your own energy supply but actively reducing your contribution to climate change.

Finally, your customers will thank you and new customers will seek you out for reflecting their values. Research conducted in 2020 showed that out of 10,000 global respondents, 50% say they only buy products from brands that ‘try to be eco-friendly’.

Beginning onsite generation and other considerations

At EIC, we provide guidance on the installation and integration of onsite generation into your business model. We recognise the value of such technologies in isolation. However, we also believe that parallel technology working in tandem can release even greater returns for you.

As such, alongside battery storage and onsite generation options we also offer intelligent energy management services. After all, it would be a shame to make savings from your own energy generation and then lose them to inefficiency. To find out more about these services and how they can work for you, get in touch.

Alone, together: Mental health during lockdown

Posted on 27th May 202027th July 2020 by Josh Ellison

EIC looks back on the recent Mental Health Awareness Week UK, this year’s theme of kindness and some of the stories of kindness that have emerged from the energy sector since lockdown began.

Kindness to all

The theme of kindness could not have been more appropriate for this year’s Mental Health Week UK, with so many struggling under the emotional, financial and medical burdens of COVID-19 and the subsequent lockdown.

Indeed, kindness, solidarity and generosity are things that have been in great demand as a result of the widespread concerns wrought by coronavirus. Despite the added pressure felt simultaneously by the commercial energy sector, it’s proponents have responded with a magnanimity seldom anticipated by their customers.

Orsted

Danish renewables supplier, Orsted, has promised more than £165,000 to various health and charity organisations across the UK to help support them through the crisis, beneficiaries include Guy and St. Thomas’ Hospital and Liverpool University Hospitals NHS Foundation Trust. Duncan Clark, the supplier’s UK region head, impressed the importance of solidarity between companies and their customers:

“Across the UK, the current situation is having a profound effect on families and communities.. It is at times like these that we must come together to do what we can to support each other.”

Duncan Clark, Orsted

British gas

Big six supplier British Gas stated their allegiance to customer welfare early on in the lockdown by announcing that vulnerable customers would be issued with 2 weeks of discretionary credit for electricity. The support will be pre-loaded onto keys or cards while gas customers will receive £5 credit, British Gas is also offering a remote version of the same service for those customers with smart meters.

Emergency measures

Emergency credit limit for gas and electricity has been extended across the board by many major suppliers in the UK, with E.ON raising the limit tenfold from £5 to £50 and nPower raising emergency credit limits from £7 to £45.

Hands across the oceans

The trend of solidarity hasn’t stopped in the UK, energy companies across Europe are taking up the cause of customer support during the challenges of COVID-19. Italy was infamous for being one of the worst affected European countries and taken as an omen to be heeded by other EU states, domestic energy giant ENEL has answered with vigour. The supplier has donated €23m to support Italian healthcare professionals by funding hospitals, beds and machinery and president Patrizia Grieco framed this move as an act of duty from ENEL.

“We are an Italian multinational with strong ties with the territory. It’s natural but also a duty to aid the territories where we operate and the communities we work with every day.”

Meanwhile in France, multinational ENGIE, has also contributed to Italy’s fight against the virus by providing free electricity and technical assistance on the construction of new medical units.

A kinder world

The primary beneficiary of the lockdown measures however, might be an unexpected one, with the slowing of economic activity and the subsequent drop in emissions, the planet is receiving a long overdue dose of kindness from our entire species.

COVID-19 may have given us an opportunity to reflect on our current practices as well as a vision of what the world could look like with better, greener behaviour from us.

EIC are champions of sustainable business practices through an end-to-end approach that can support you from initial procurement of your utilities, through to maximising their efficiency with IoT in order to faster deliver a sustainable commercial culture.

The strides EIC is taking to help the UK build a green commercial sector and reach climate targets are myriad and you can find out how to engage with them on our website.

Here comes the Sun

Posted on 20th May 202027th July 2020 by Josh Ellison

EIC explores the benefits and future of on-site solar generation for businesses, how COVID-19 has highlighted and bolstered the strengths of solar power and how EIC can help businesses engage with the technology.

The wild blue yonder

Lockdown, while effective, has been a source of ongoing financial and emotional strain for many in the UK and businesses are no exception. However, there have been a number of benefits to this economic slowing that perhaps are going overlooked.

Chiefly, air pollution, in proportion with industrial energy demand, has dropped significantly. Combined with the severe oversupply of Oil and faltering resilience of fossil fuels generally, this has given solar generation the opportunity to enjoy a moment in the sun.

However, solar is not a recent arrival to the energy scene, existing theoretically since at least 1839 thanks to French scientist Edmund Bacquerel. Bacquerel’s work was groundbreaking because it was the first time that solid material with no moving parts had been used to convert sunlight directly into electrical energy.

A guiding light

Since 1839, we’ve come a long way and furthest perhaps in the last five years, during which time the costs of solar have halved while storage options have improved consistently with the introduction of graphene and vanadium technology.

The conditions of lockdown have demonstrated that renewable energy sources are likely to be the most resilient to the supply chain disruptions that a major crisis can create.

In fact, EU solar generation jumped by 28% year-on-year, between March 28th and April 26th of this year compared to 2019, breaking generation records while doing so.

Energy security is a basic necessity for the survival of any business and, as such, will be a subject of great scrutiny throughout lockdown and in its aftermath. Novel technologies like on-site generation will become more attractive, not only for their resilience but for the savings that their flexibility offers.

The use of on-site photovoltaics can also improve a company’s carbon profile while providing a measure of protection against supply failure.

EIC manages around 12TWH each year and with over 40 years industry experience, we are able to create bespoke energy solutions for your needs. We can help you engage with on-site generation, saving you as much as 20% on your energy usage or 40% when combined with on-site battery storage. Better still, in times of plenty, you’ll be able to sell excess energy back to the grid and further offset energy costs.

Our solutions page contains full details of our on-site generation and storage offerings, as well as further information on the compliance service we provide that can be bolstered by such technology.