What’s more, research suggests employees are choosing to work in the office rather than remotely to cut home energy bills. More people in the workplace means higher energy usage and bigger bills. So how can SMEs cut energy costs but remain productive?
We’ve put together some handy tips to help with energy efficiency. But before we get started, what financial support is available for business owners?
In September 2022, the government announced business customers would now get the same level of support with their energy bills as domestic ones. The energy bill relief scheme runs from 1st October 2022 until 31 March 2023. Those who qualify will get discounted gas and electricity rates.
The scheme is available to everyone on a non-domestic contract including:
There are some exclusions. You may not qualify for the discount if you use gas or electricity for the purpose of generating power you sell back to the grid. Power stations, for example.
For all non-domestic users in Great Britain, the government-supported price is set at:
As estimated wholesale costs for energy this winter of £600 per MWh for electricity and £180 per MWh for gas, you’ll be paying a lot less during the six months the scheme is running.
If you use heating oil or other fuels instead of gas, you will be provided with comparable support. The government’s expected to announce these discounts shortly.
You don’t have to do anything to get the non-domestic discounts. It’s automatic. Expect to see the discount from November 2022 when your supplier bills you for October’s usage.
If you’re out of contract, don’t worry. Set up your contract as normal. Your supplier will automatically apply the relevant discounts to your bills for the duration of the relief scheme.
The government will review the scheme in December and decide if support needs to continue after the March 31st cut-off date. In the meantime, here are some tips to help you save energy and reduce your bills.
Start by letting your staff know you want to make the company more energy efficient. Small changes to employee behaviour – even if it’s just turning off the lights in a room when they leave it – can make all the difference. Making energy saving a team effort.
Before you can start cutting energy costs, you need to identify where and how your business wastes energy. If you don’t have a smart meter, think about installing one. Daily meter checks will show you your average usage and reveal when there are spikes.
You should also carry out an energy audit to work out how, where and when your business uses gas and power. And how much you spend on each.
The Department for Business, Energy & Industrial Strategy estimates an audit will cost around 1% of your total energy bill. But you may find your current supplier will offer you a free energy audit when you switch tariffs. Your other option is to do it yourself.
Analyse the data
Go through your energy bills for the last two years. If you can, break down the usage by category (heating, air conditioning). Or look at gas and electricity usage per month/quarter/year.
If heating and air conditioning costs are high all year round, you could reduce them by adding insulation or window treatments. If your bills have increased in the past year, why is this? Have your staff been working longer hours, for example? Or is your equipment running less efficiently and using more energy?
Walk around your site/premises
Take a walk around your business’s location to see if you can spot any problem areas. Consider:
Other things to look out for include:
Create an action plan
Now you know how, where and when you’re using energy, plan how to reduce it. Focus on quick fixes like insulation, timer switches and thermostat settings to start with. Then move on to the bigger, more costly projects – replacing old boilers, windows, and lighting systems. The initial outlay might be expensive but you’ll be saving in the long run.
List the changes you’d like to make and the amount they’ll cost alongside a column noting the money you expect to save. It’ll help you keep track of changes and budget year on year.
Get smart with your lighting. It accounts for around 40% of your energy usage so it makes sense to start savings here.
You want to keep your employees warm in the winter and cool in the summer, of course. But bear in mind that increasing the temperature by just 1 degree can cost you up to 8% more. And leaving your air conditioning on all day in summer can add another 30% to your bill.
Along with monitoring temperatures and timing, there are other things you can do to help:
If you run a manufacturing business, you’ll have machinery running costs to pay. Save energy and costs by switching off motors during lunch hours. And turn off machinery at the end of each day. If you label switches by machinery, your employees will know what they can turn off and how to do it correctly.
Laptops use less energy than desktop computers, just remember to turn them off at the end of the day. Also, unplug phone chargers, PCs, and printers when not in use. It’s a myth that leaving computers in standby mode costs you nothing. Even a blinking power light drains energy.
Remind your employees to turn off and unplug daily. And check banks of switches – do they need to be left on or can you unplug them (or remove some of the plugs)?
Whether running a kitchen is part of your business or you have a small one for employees’ use, there are lots of ways you can save energy.
7. Go paperless
Turning off your printer when it’s not in use will save energy. But how much do you really need to use it anyway?
Cost saving shouldn’t mean skimping on your business insurance. If there’s a claim and you have a gap in your cover or you’re underinsured, you could end up seriously out of pocket. Protect your work, your bank balance, and your employees with Towergate’s range of business insurance policies.
We offer tailored business insurance and trade-specific policies to suit your needs. For more information visit our small business insurance page. Or call 0344 346 0409 to speak to a specialist adviser.
Alison Wild BCom (Hons), MAAT, ATT, Taxation Technician is a highly respected industry professional who has been working with and advising SMEs in areas including tax, pensions, insurance and marketing for over 25 years. She is a member of the Association of Accounting Technicians (AAT) and Association of Tax Technicians (AAT) and also has considerable experience as a residential landlord.
Date: November 01, 2022
Category: Small Business