Majority of energy managers still unaware of rising non-commodity costs, while 88% say they lack a tool which measures the impact on future bills
More than half of senior decision makers responsible for energy spend at UK businesses remain in the dark about rising non-commodity costs, a YouGov survey has revealed.
The research, commissioned by nPower Business Solutions, found that 58% of corporate decision makers and energy managers are “unaware or unsure” of the potential impact of non-commodity costs on energy bills over the next decade.
Non-commodity costs – the various network and policy charges associated with Britain’s ongoing low-carbon transition – are estimated to increase by up to 45% in the next ten years. As a direct result of this increase, a recent study of the UK energy market carried out by SMS Plc forecasts that electricity costs will rise by 55% between 2018 and 2028, while gas costs are set go up 21%.
Although two-thirds of respondents to the YouGov survey said they expected their energy costs to rise during this ten-year period, only 13% believed these costs would increase by more than 40% on current rates.
Such a finding not only demonstrates a lack of understanding concerning the possible effects of non-commodity costs, but also emphasises the need for business to better plan for future.
The same conclusion can also be drawn from the fact that 88% of respondents said they lacked access to a tool that can predict how their energy costs will alter in coming years.
Energy Risk Forecaster
Fortunately, SMS Plc has devised a tool exactly for this purpose. By allowing British businesses to project their potential electricity and gas costs for up to ten years in advance, the free-to-use Energy Risk Forecaster aims to assist business energy users in developing long-term investment, procurement and efficiency strategies.
Commenting on the Energy Risk Forecaster, Paul Jarvis, Head of Energy Markets at SMS Plc, said:
“We’ve created this tool in response to the demand from energy users who need to better manage their long-term price risks. As the tool provides a complete picture, building up both non-commodity costs and wholesale price forecasts, it’s been extremely well received by our clients.
“Using our forecast as a benchmark, we help energy users develop strategies to not only mitigate the risk, but to also unlock the benefits that the new market is creating for those willing to plan ahead and adapt quickly.”
You can use the Energy Risk Forecaster to project your 10-year costs here.
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