Time for energy cost action

When it comes to the actual cost of energy, though they are pretty much at the mercy of the market. In many cases, no amount of every saving equipment is going to mitigate what are, in the UK, some of the highest energy costs in the developed world. This has been brought into focus by Energy UK and the CBI in their joint report, 'Cutting Business Energy Costs: The case for action'. 

The trade bodies warn that persistently high business energy costs are threatening the UK’s global competitiveness, dampening investment plans and putting the brakes on the country’s growth ambitions. It seems to be something of a downward spiral – as margins are squeezed due to high energy costs, less money is available to invest in energy saving measures.

As the report highlights, while some energy-intensive sectors benefit from partial support, these schemes are limited in scope and often funded through levies on other customers, exacerbating cost pressures for those businesses outside the eligibility criteria.

It further calls upon the Government to deliver a robust national strategy to cut business energy costs – moving beyond short-term crisis responses and setting a clear path to a more affordable and sustainable energy future for businesses across the UK.

Louise Hellem, chief economist of the CBI, said:  “Developing a clear national strategy for business energy costs is about far more than just helping struggling firms to pay down sky high bills – it’s the very foundation of the country’s growth mission.   

“To their credit, the Government has recognised the scale and importance of the issue. But we know we must go further and faster to deliver meaningful solutions.  The modern industrial strategy and the British Industrial Competitiveness scheme represent a welcome start, but in a world where energy costs increasingly determine global competitiveness, the UK simply cannot afford to lose focus or momentum."

This is not the only high profile report of recent times to call upon the Government to take action over UK energy costs. In June last year Make UK published a report on 'Tackling Industrial Energy Costs', which likewise urged action to remove regressive policy levies from energy bills to reduce costs, and create a fixed electricity price to put British manufacturers on a level playing field with international competitors.

WIth businesses and trade bodies broadly aligned on the need to take action on non-domestic energy prices, let's hope that those with the ability to make changes take this as the right moment to take some positive action before the UK falls even further behind its competitors.

Charlotte Stonestreet

Editor