npower commissioned white paper reveals energy risks for business set to increase
npower has commissioned a new white paper from the London School of Economics entitled “Energy Risk Management for UK Business”.
The key finding of the new white paper is that an increase in financial, reputational and legislative risks associated with business usage of energy means organisations need to put in place effective plans now to reduce their exposure to future risks.
The white paper follows statistics in the latest npower Business Energy Index, which revealed that businesses rank energy as posing greater risk to them than health and safety, credit and security. They scored energy 6 out of 10 in terms of level of risk it poses; this was in contrast to the highest risk which was legislation, scoring 6.7 out of 10.
To address this concern and to stress the importance of immediate action, the white paper provides a guide to current energy risks and forecasts how they will grow in the future. It concludes by urging businesses to ensure energy is a board-level consideration and to control their exposure to risk by working in a collaborative manner internally by combining the energy management and procurement processes.
The paper also looks at how the role of energy suppliers is changing. No longer can they simply supply energy; they now need to help businesses to manage their consumption and procure energy in as cost-effective way as possible, to ensure their survival. It concludes by highlighting the role that energy suppliers now need to play is as a consultant to help organisations with their energy risk management.
“The risks faced by UK business related to energy will continue to grow. Energy price volatility and increases, reputation and price risks from carbon regulation, and increasing regulatory and technological complexity all combine to ensure energy will continue to pose a significant risk for UK businesses moving forward,” said Dr Samuel Fankhauser, author of the paper, principal research fellow at the Grantham Institute on Climate Change and the Environment at the London School of Economics and a member of the Committee on Climate Change.
“As a result, businesses should ensure they are best-placed to manage these risks, by developing an integrated strategy with board-level support that brings together the management of energy consumption and energy procurement. This will be a step-change for many organisations, but it is crucial they do this now so they can take advantage of cost and carbon savings and the reputational benefits of successful regulatory compliance and energy management,” he added.
David Cockshott, head of industrial and commercial markets at npower, commented: “Our aim in commissioning the white paper was to reveal the risks energy poses to businesses, show how they are likely to change in the future and ultimately, how organisations can manage these risks. We believe that energy suppliers have an important role to play in helping companies to manage their exposure to energy risk and we continue to develop products and services to assist in this way.”
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npower is one of the top energy suppliers to the UK business market, serving over 238,000 small to medium sized enterprise sites and around 17,000 industrial and commercial customers, with over 100,000 sites.
npower is dedicated to helping UK businesses use energy more efficiently and therefore spend less money on their bills. It aims to have a positive impact on the communities it serves and reduce its customers’ carbon footprint whilst always improving its service to its customers.
npower specialises in risk management solutions, including market-leading flexible energy purchasing, energy efficiency and broader energy management functions, tailored to every size of business.
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