In the first of his regular columns Dave Cockshott, board director at the Inenco Group, looks at the ever-changing landscape in the sector.
I began my career in the energy industry as an electricity purchasing manager at Inenco in 1990. Almost 25 years later (yes, I too baulk at the fact it’s been that long) and following a variety of roles in the industry, I’ve returned to the Inenco Group as a main board director, responsible for sales and marketing among other things for its industrial and commercial clients in the UK and Europe.
Working on both the supply side and for Third Party Intermediates (TPIs) has given me the unique perspective to witness first-hand the huge volume and breadth of changes to the energy landscape.
Twenty-five years ago the main focus was simply selecting the right tariff and later helping large businesses to procure energy through straightforward fixed price contracts. The notion of an “energy manager” was almost unheard of.
Now, every aspect of the market has become more complex, creating an increasing workload for the now-vital energy manager who may be responsible for energy compliance, energy buying and carbon reduction all at the same time.
From deregulation to the impact of policy on businesses, the cost of Electricity Market Reform to the ever-changing carbon legislation, one thing is for sure: it has been a rollercoaster ride for us all and the impact of cost and competitiveness on businesses has certainly taken its toll. Despite the current stable market prices, who knows what’s next.
As the needs of energy managers have had changed, so too has the role of an energy consultant. The age-old formula that “energy cost = volume x price” is more fitting now than ever before, yet it amazes me that energy procurement and management is still not fully integrated in many businesses. We are all here to help our clients to manage their costs by integrating carbon and price strategies. Those that don’t are sure to struggle with volume exposure – and in a climate where businesses face external pressures from every direction, why overlook an opportunity to reduce cost wherever possible?
The introduction of the Energy Savings Obligation Scheme (ESOS) could be the catalyst for this change. It feels a bit like the car seatbelt law in the 1980s: it’s a shame we needed a law for our own good, but now it’s here it should soon become the norm and rather than a pain, it will provide benefits for all who comply with it.
In this column I’ll be aiming to use my perspective of two and a half decades working on both sides of the fence to air some of the issues and debate the topics that impact on the energy sector. In the meantime, I’ll be at the Energy Event at the NEC in Birmingham. Do drop in to Inenco’s ESOS coffee bar and say hello.