Home Business News The average UK business is using less energy than a year ago

The average UK business is using less energy than a year ago

by LLB Finance Reporter
11th Apr 24 8:14 am

POWWR, a respected energy software provider, today reveals that the average UK business now consumes over 25 MwH of energy per annum.

This is 4.6% less than last year. However, there remains significant differences between the amount of energy used by businesses throughout the UK.

For example, businesses in South Wales use almost a third (29%) more energy than those in London, and businesses in South Scotland 15% more than those in the North.

The overall reduction in energy usage has had a positive effect on energy bills, with the average UK business now spending £4584 on electricity.

This is over a third (38%) less than this time last year, and 13% less than last quarter. Yet, the cost varies wildly by region with businesses in North Wales paying on average £1000 a year more for their energy than those in London.

“These results suggest that UK businesses are doing more to cut their energy usage; positively impacting both their environmental credentials and bottom line. This change is, however, mostly driven by very large companies, who are bound to stakeholder and regulatory pressure to reduce their energy use,” explains Matt Tormollen, CEO at POWWR.

POWWR’s second Quarterly Energy Barometer Report is based on over 327,000 data points, meaning the report provides unprecedented insight into how much energy UK businesses are consuming, and what they are paying for it.

The good news is that the cost of energy is expected to continue to fall over the coming months with the recently announced price cap from Ofgem capping what a supplier can charge for energy at 6p per kilowatt hour (kWh) for gas and 24p per kWh for electricity.

With more competition than ever before and prices starting to come down it is, perhaps, no surprise that confidence among business leaders is returning and they are keen to lock in contracts for the long term. This is causing the average energy contract length to rise to its highest level (25 months) for a year and a half. Smaller companies, in particular, are taking out longer contracts to provide themselves with greater stability.

“Real progress is being made by UK businesses to use less energy. They are, in turn, being rewarded with longer, and lower, contracts,” adds Tormollen. “Whilst there is clearly more work that needs to be done to reduce carbon usage within these shores, the report shows that after a tough few years for businesses, the future looks bright.”

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