In a recent webinar presented by our procurement partner, Tradition Energy talked about energy risk management and why it is vital for businesses.
With energy procurement an important factor in an energy management strategy, managing risks can be a complicated game of finding the sweet spot between taking advantage of market opportunities and leveraging all the factors surrounding your business’ use of energy.
An organisation’s energy team has to navigate market volatility, limit the businesses exposure to price risks and minimise energy expenditures.
But, in recent years, it’s clear that, due to benign wholesale prices, businesses are focusing more attention on holding onto the current cost base in their energy policy rather than looking at energy savings and a good all round energy management strategy.
Energy savings strategies are languishing on the corporate back burner – forced there by the static market. Non-energy related initiatives that provide better ROI claim the board room focus and, since 2016, business energy policy has slipped down the list of priorities in the board room and with employees themselves.
But – how long can this last?
Tighter system margins, more intermittent renewable power and changes to the way the energy industry must balance supply and demand will make half-hourly prices more volatile and the overall prices rise.
Not just about cost
Organisations are changing their business processes to accommodate for rising energy prices and, as renewable energy gains strength, supply becoming more localised and unpredictable.
Nailing the best energy procurement strategy for your unique business will address issues of cost but, why should it stop there?
As we see it, energy costs are going one way – up. And we know that budgets aren’t increasing.
Which is why energy management needs to return to the agenda soon. Understanding up-and-coming market risks enables planning opportunities, including a savings strategy that can reinvest money back into the business. Keeping costs down is a short-term approach but a cost savings strategy can deliver rewards for years to come.
What do we mean by energy-saving?
Energy Management and the process of monitoring, controlling, and conserving energy in a building or organisation leads to energy savings.
- Energy consumption needs to be metered and the data collected
- Energy savings opportunities sought and identified through analysis of data and building inspections
- Strategy to prioritise energy savings opportunities (from tackling billing inconsistencies to replacing inefficient equipment)
- Measure the performance of energy savings efforts through KPI setting
At TEAM Energy we help organisations with each area of this process.
For our customers, Sigma energy and carbon management software makes energy an integral part of business by helping to secure energy efficiency gains, sustain carbon reduction targets, comply with legislation and regulatory requirements and maximise cost recovery opportunities.
Our energy bureau services can work as an extension of an organisations energy team; taking the administrative burden of processing and checking utility bills and liaising with suppliers, allowing them to focus on monitoring and targeting.
At TEAM we have in-house energy consultants who can provide thorough building inspections to promote energy efficiency and help organisations get the most out of energy schemes and initiatives.
Overall, TEAM can provide software, outsourced support, or an energy consultant to help organisations implement an effective energy management strategy. And with Brexit looming on the horizon, it’s worth getting back on the board room agenda sooner rather than later…