UK businesses are now consuming less energy on average than they have in previous years, according to the latest report from POWWR.
The average energy usage now stands at just over 25 MwH annually, marking a 4.6% reduction compared to the previous year. However, despite this overall decline, the data uncovers considerable regional disparities in energy use.
Businesses in South Wales are reported to consume almost 29% more energy than those in London, with South Scotland’s consumption being 15% higher than its northern counterpart.
This reduction in energy usage has notably impacted business electricity bills, leading to an average expenditure of £4584, which is 38% lower than the same period last year and 13% below the last quarter. However, the cost of energy still varies significantly across regions, with businesses in North Wales facing on average £1000 higher annual energy bills 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,” stated Matt Tormollen, CEO of POWWR.
The findings stem from POWWR’s second Quarterly Energy Barometer Report, which analysed over 327,000 data points to offer insights into the energy consumption patterns of UK businesses and their expenditure on it.
“Real progress is being made by UK businesses to use less energy. They are, in turn, being rewarded with longer, and lower, contracts,” Tormollen added. “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.”
There should be further downward pressure on energy bills, as the recent price cap announcement by Ofgem set the maximum charge for energy at 6p per kilowatt hour for gas and 24p for electricity.
This prospect, coupled with an increasingly competitive market, is seemingly restoring business confidence, prompting a rise in the average length of energy contracts to 25 months, the longest in the past year and a half. Notably, smaller businesses are opting for longer contracts, seeking stability in their operational costs.
