Written By: Graham Paul – Service Delivery Director
Graham leads service delivery, sales and marketing to enhance customer experience and scale TEAM’s carbon and energy services with a data driven, outcomes focus.
Summary
A new joint report from Energy UK and the Confederation of British Industry (CBI) warns that persistently high energy costs are undermining the competitiveness of UK businesses, limiting investment and slowing progress towards Net Zero. The report urges the Government to move beyond short term interventions and develop a clear, long term national strategy to reduce business energy costs and support economic growth.
What the Report Says
The report, Cutting Business Energy Costs: The case for action, highlights that British businesses face some of the highest energy costs among developed economies, placing them at a disadvantage compared with international competitors.
According to Energy UK and the CBI, these elevated costs are having several direct consequences:
- Reduced competitiveness, particularly for energy intensive and manufacturing sectors
- Delayed or cancelled investment, including investment in low carbon technologies
- Pressure on business operations, with some organisations scaling back activity because of rising energy bills.
Dhara Vyas, Chief Executive of Energy UK, summarised the challenge clearly:
“Energy costs persistently above those faced by their counterparts in other countries harm the competitiveness of UK businesses, prevent them investing in the future – including in the switch to clean energy and can contribute to businesses having to cut back their operations.”
Why This Matters for UK Businesses
The report argues that high energy costs are no longer a short‑term issue linked solely to recent market volatility. Instead, they represent a structural challenge that risks holding back the UK economy if left unaddressed.
Energy UK and the CBI warn that:
- Businesses are increasingly factoring energy costs into decisions about where to invest and operate
- Ongoing uncertainty makes it harder for organisations to plan for the long term
- High costs can act as a barrier to decarbonisation and clean energy investment, slowing progress towards Net Zero goals.
The report also notes that while government support has been directed towards household energy bills, support for businesses has been more limited, increasing pressure on commercial and industrial organisations.
“What this report highlights very clearly is that high energy costs are no longer a short‑term issue for UK organisations. When electricity prices are materially higher than those faced by European peers, it affects competitiveness, investment decisions, and the pace at which organisations can improve energy efficiency. Understanding where energy is used and where it can be used more efficiently is becoming a fundamental part of managing cost and risk.”
Graham Paul, Service Delivery Director, TEAM Energy
The Call for a National Strategy
Energy UK and the CBI are calling on Government to develop a robust national strategy that:
- Moves beyond short‑term crisis measures
- Provides clarity and confidence for businesses planning future investment
- Supports a more affordable and sustainable energy system over the long term.
The report sets out the foundations for a wider programme of policy and economic analysis, including:
- Examining how energy costs influence investment decisions
- Assessing funding models for essential energy infrastructure
- Exploring how energy policy can better support both major industrial sectors and the wider economy.
Further findings and potential solutions are expected to be published later in the year as part of this joint programme.
What Organisations Can Take from This Now
While the report focuses on national policy, it reinforces several practical realities for UK organisations today:
- The untapped basics of energy efficiency has some of the greatest potential to make the biggest impact on organisations’ energy use and sustainability
- Energy costs remain a strategic business issue, not just an operational one
- Visibility and confidence in energy data management are increasingly important for planning and investment decisions
- Long term resilience depends on understanding both current exposure and future risk in a high-cost energy environment.
As the policy debate develops, organisations will need to balance short‑term cost pressures with longer‑term goals around sustainability, Net Zero, resilience and competitiveness.
For many organisations, improving energy efficiency starts with understanding how and where energy is being used, which is why structured commercial energy audits and surveys remain one of the most effective ways to identify practical, cost‑effective opportunities for improvement.