Sunday, 15 July 2012

Power Efficiency Releases Boardroom ‘Energy Agenda’ Guidance to UK firms

· With energy prices set to nearly double by 2021, creating an £8.4bn additional cost for the UK economy, Power Efficiency’s 10-point guide will help UK boardrooms minimise the pain ahead.
· Companies that do not manage energy strategically from the boardroom will “… see energy inflation eat into profits very sharply over the next decade.”

Power Efficiency has today released ‘The Energy Dilemma’, a ten-point guide, which will help board directors of UK companies understand why they need to take the energy issue ‘out of the plant room and into the boardroom’.

Power Efficiency, a Balfour Beatty company, is an energy procurement and carbon reduction consultancy, which acts for a number of blue-chip companies and many of the UK’s leading commercial property managing agents.

The paper was developed following research published earlier this year, commissioned through the independent consultancy Waters Wye Associates, which projected that energy costs are set to rise by 81% by 2021. The Government’s own Inter-departmental Analysts Group (IAG) predicts that gas and electricity will rise by 116% and 167% respectively over the next decade.

Bobby Collinson, managing director at Power Efficiency, said: “The touch points for energy management throughout an organisation are far reaching: procurement, IT, facilities, manufacturing and HR are just a few. The energy contract is only one part of the puzzle. Energy is a strategic issue for the future of all organisations that impacts the bottom line. Those that fail to treat it as a boardroom issue will see energy inflation eat into profits very sharply over the next decade.”

‘The Energy Dilemma’ can be downloaded at It covers several aspects of energy management, giving board members, especially MDs and FDs, clear advice on where they should focus in order to improve efficiencies and lower costs going forward.

Below is a brief summary of the agenda items in the white paper that Power Efficiency recommends are discussed at board level to ensure energy management is effective within an organisation:

· STRATEGY - Does the business have an energy management strategy, which addresses the issue of how we will manage rising energy costs?
· COMPLIANCE - Do we look at compliance as a ‘tick box’ obligation or is it something we can turn to our business advantage?
· PROCUREMENT – How do we procure energy? What is the basis of our supply contracts (fixed price or flexible) and if the latter, how robust is our risk management strategy?
· INVESTMENT - What level of capital investment do we need to reduce energy costs and become compliant? What ROI can we realistically expect from this investment?
· OPERATIONS AND MAINTENANCE - Do we risk a costly reactive maintenance programme or should we go for an alternative like Planned Preventative Maintenance (PPM) or Condition Based Maintenance (CBM) and what criteria will we use to make this decision?
· COST MITIGATION - Where can we look for help with our investment and running costs? What does the Green Deal mean for our business?
· MONITORING AND MEASUREMENT - If we don’t measure it properly, we won’t be able to manage it properly. What do we need to put in place to give the business a better understanding of its energy management performance?
· CREATIVE IDEAS - How can we challenge our thinking to create opportunities to improve energy performance? We need to ask questions like: Do we work the correct hours? Are we in the correct building?
· CONTINGENCY - We have taken energy supply for granted. What will the business do if supply is interrupted and can we take advantage of the National Grid’s STOR and Frequency Control Demand Management offerings?
· NEW SOLUTIONS – Is energy management something we can outsource or risk transfer? We’ve been hearing about new models for this market, which provide such a solution, for example, what is the ESCO model and is it right for our business?

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