The Business Energy Tracker 2023: is the energy crisis still impacting business confidence?
By Anthony Ainsworth, Chief Operating Officer (COO), npower Business Solutions (nBS)
Last year, we conducted our Business Energy Tracker for the first time to understand the impact of the energy market and policy decisions on businesses’ attitudes to energy, risk and their potential investment plans. The results showed that more than three quarters (77%) of businesses felt that energy was their top risk.
Since then, the volatile wholesale energy market has continued to bring uncertainty and high costs to UK businesses. Gloomy forecasts resulted in an unprecedented intervention from the government in the form of the Energy Bill Relief Scheme (EBRS) to help businesses navigate the winter.
However, with the EBRS being replaced by the Energy Bills Discount Scheme (EBDS) on 1 April 2023, which is a lower form of support for most businesses, in this year’s Business Energy Tracker, we wanted to take the pulse of whether confidence will continue to be affected.
This in-depth piece of research, produced with support from the Major Energy Users Council (MEUC) and Energy Intensive Users Group (EIUG), gathers the voices of over 100 large UK organisations.
The results reveal that energy remains the top concern for businesses for the second year running, and is a board-level concern for 91% of the organisations we spoke to, up from 80% in 2022.
What is the impact on business confidence?
One major finding from the report is that the energy crisis is impacting businesses’ ability to plan for the long-term, with just one in six saying they are only able to plan for the next 6-12 months.
That said, the findings also highlight that businesses are aware of the benefits of investing in net zero initiatives, with almost two thirds of respondents making sustainability their top investment priority in 2023.
However, for businesses to have the confidence to invest and press ahead with their sustainability plans, the right policy must be in place.
Does policy need to change?Â
With the former Department for Business, Energy and Industrial Strategy (BEIS) being split into four new sector-focused entities, including the Department for Energy Security and Net Zero (DESNZ), we wanted to find out if the initiatives brought into force over the past year have had a positive impact.
The EBRS has been a real help to more than one third (37%) of our respondents. However, 67% don’t believe that the EBDS will go far enough to support them, and nearly one in five (19%) believe that the government should keep the EBRS until March 2024, despite the cost to the economy in doing so.
That said, when it comes to what they would like to see from the government, one interesting finding is that businesses would welcome more than just reductions in their energy invoices. Three quarters (75%) of respondents would like to receive incentives to reduce their overall power demand through energy efficiency initiatives, while 60% would like more support in switching from fossil fuels to renewable alternatives.
Being the voice of business
At nBS, we are committed to ensuring that the voice of business is heard at the highest level. The insight from the Business Energy Tracker will give us the opportunity to present the findings to the government, as well as other influential stakeholders. If businesses are supported to increase energy efficiency and reduce demand, it will benefit the whole of the UK.
You can download your copy of the Business Energy Tracker 2023 report here.
