Post-Brexit, the only certainty is uncertainty. The pound and the FTSE250 continue to slide and nobody knows what will happen to UK energy policy as it pulls away from the EU.
Energy investors have been calling for certainty since electricity market reform (EMR) began almost six years ago. Now they have less certainty than ever.
A weaker pound means more expensive gas, around half of which is imported into the UK, and more expensive oil.
Within the department of energy and climate change, Andrea Leadsom was a vocal member of the Leave camp. Amber Rudd supported Remain. It will be interesting to see who remains after the inevitable reshuffle.
Businesses have planned for a period of uncertainty, many hoping that those plans would not have to be enacted. For exporters, there is an opportunity despite the incoming recession predicted by many financial analysts. But the reality is that many firms will now hunker down and tighten belts until the dust settles.
But given that commodity costs are likely to increase, businesses that double down on energy efficiency will reduce their cost base. As non-commodity costs relating to the contracts for difference and capacity market are also set to rise steeply over the next couple of years, any efficiency improvements made now will be even more valuable come winter 2018 onwards.
With less money coming in and higher costs, boards may also become more likely to engage in non-core business matters such as energy.
Even if boards are less inclined to sign-off sizeable investments in the near-term, taking low-and no cost measures can lead to double-digit improvements in energy efficiency. Using lifecycle cost analysis and tying procurement to maintenance are some of the things business should already be doing. But simply ensuring employees understand how their behaviour affects costs can also yield significant savings.
Engaging employees in energy saving programmes is critical to success. At a time when many will be understandably concerned about job security, outlining plans to reduce waste and safeguard jobs in the new post-Brexit climate may drive greater change than in times of plenty.
So while the next few years may prove difficult for many firms, there is an opportunity to emerge from the current period of uncertainty not only intact, but more robust.
Now the best energy managers will show their worth.
Brexit or Remit: What matters most to energy managers?
Brexit planning: A guide to navigating potential energy market disruption
Click here to see if you qualify for a free subscription to the print magazine, or to renew.
Follow us at @EnergystMedia. For regular bulletins, sign up for the free newsletter.
I was there in energy management in 1974 when the Energy Manager role was born in response to the four fold rise in oil prices. Tim, I think you are right. This is an opportunity once again to show their mettle where capital is tight and hearts and minds need to be engaged to reduce consumption