Rising energy costs are impacting many businesses due to volatile commodity, transportation, capacity, and new levy costs. However, energy cost is not uncontrollable and more can be done to reduce and control energy costs.
Below are six practical strategies businesses can implement to improve energy efficiency, reduce avoidable capacity costs, obtain relief from levies where businesses qualify, and gain better control over energy spend.
Focus on understanding where unnecessary costs (energy waste) is coming from.
An energy audit helps identify:
Energy audit is important when reviewing non-commodity costs. In some cases, businesses are paying for more capacity than they actually need, unnecessarily increasing charges.
An effective audit should not just show how much energy is being used, it should identify what is increasing overall costs and where savings can realistically be achieved.
Replacing outdated equipment can reduce both energy consumption and costs, particularly in high-usage environments.
However, businesses should avoid replacing systems only to “be energy efficient.” The focus should be on assets that:
Common examples include:
Targeted upgrades are usually more cost-effective than large-scale replacements. The priority should be reducing high-cost consumption areas first.
Many businesses review energy costs only after invoices arrive. By that stage, unnecessary costs may already have been building for weeks or months.
Energy monitoring systems provide visibility into:
This helps businesses identify where energy use is misaligned with operational needs.
For example, if equipment continues to run during unoccupied periods, or if production schedules change but energy usage remains the same, unnecessary costs can accumulate over time.
Monitoring can also help identify whether agreed capacity levels still reflect how the site operates. If capacity is set too high, businesses may continue paying for capacity they no longer need. If it is set too low, they may face additional charges.
Regular monitoring should also be supported by invoice validation checks to ensure charges are accurate and aligned with contracts, usage and agreed capacity levels.
The goal is not simply to collect data. It is using that data to identify issues early, reduce unnecessary costs, and maintain better control over long-term energy spend.
Energy procurement remains one of the biggest opportunities for cost control, yet many businesses still approach it as a routine renewal exercise.
An effective procurement strategy should consider:
Choosing the wrong contract structure can increase exposure to market volatility, limit purchasing flexibility, or result in higher long-term costs.
It is also important to review contracts well before renewal dates. Leaving procurement decisions until the final weeks of a contract can reduce buying options and create unnecessary pressure during negotiations.
Reviewing contracts at least six months before expiry gives businesses more time to:
This allows procurement decisions to be made more strategically rather than reactively.
Energy waste is often caused by day-to-day operational habits rather than major system failures.
Examples include:
Over time, these behaviours can materially increase energy costs, particularly across larger or multi-site operations.
Creating awareness across teams can help reduce avoidable consumption without requiring major capital investment.
Businesses that successfully reduce energy costs usually combine operational controls with employee accountability and clear site-level responsibilities.
Some businesses may be eligible for government-backed energy relief schemes that reduce certain policy-related charges and levies.
These schemes are usually designed for energy-intensive businesses or specific industries where electricity costs have a significant impact on competitiveness.
Where a business qualifies, these schemes can provide significant reductions on eligible non-commodity costs and levies.
Businesses usually need to meet specific criteria based on industry classification, energy intensity, consumption levels, or operational activity.
This is why it is important to review whether the business qualifies and ensure the correct applications, evidence, and documentation are prepared in time.
Applying for the right relief scheme can be an important part of reducing overall energy costs, particularly for businesses with high electricity usage.
Why working with knowledgeable and experienced energy consultant matters
Many businesses do not have the internal time or resources to continuously review procurement strategies, monitor complex charges, analyse invoices, and identify inefficiencies across operations.
Working with an energy consultant can help businesses:
The right strategy can help businesses reduce energy costs, improve budget control, and make better-informed energy decisions over the long term.
CES helps businesses review procurement strategies, identify cost-saving opportunities, and improve visibility across energy spend.
FOLLOW US
0203 750 0853
Copyright CES © 2024
