Realising the power of renewables for small businesses

Here, Paul Sheffield, chief operating officer of Haven Power, discusses how renewables are making business sense to SMEs.

Use of renewable energy in the UK is slowly growing, now accounting for more than 20 per cent of the country’s electricity1. In June this year we had a record breaking day with over 89 per cent of the country’s electricity demand met by low carbon sources, with renewables making up 50 per cent of that supply. What’s probably more encouraging is that in the three months to June 3, over a quarter of Britain’s electricity demand was met by renewable sources.

Businesses are one of the largest users of energy in the UK, using 31 per cent of all the energy consumed, but many small and medium-sized enterprises (SMEs) are struggling to get the support they need to switch their energy supply to renewables. Research by Haven Power finds that 72 per cent of SMEs would like energy suppliers to be more committed to renewables, yet only 11 per cent say their current provider is excellent in terms of offering them renewable energy options. It seems that switching could be a major bugbear as 71 per cent say it should be simpler to change provider, while 21 per cent of those who did try to switch ended up staying with their existing provider.

Increasing the use of renewables

However, businesses and suppliers need to do more to increase the use of renewables by British companies if the country as a whole is to comply with tough new targets laid down by the government and the EU. The EU requires the UK to source 15 per cent of energy consumed in the electricity, heating, cooling and transport sectors combined to come from renewable sources by 2020. In order to achieve this target it is expected that 30 per cent of electricity generation would need to come from renewable energy – in 2016, 24.5 per cent of the UK’s electricity was renewable.

The government has sought to affect change with initiatives such as subsidies for cleaner energy sources, but companies themselves are now starting to put energy on the boardroom agenda, making it a strategic focus. The proportion of businesses choosing to use renewable electricity supplied by us has more than tripled this year, reducing the carbon emissions from these businesses by 76 per cent compared to five years ago – saving almost 1.5 million tonnes of carbon.

Our research shows that over two thirds of firms are placing an increasing value on where their energy comes from, triggering more interest in renewable energy sources. However, for businesses to really understand and embrace renewable energy, suppliers need to help their business customers understand why and how to use renewables.

Making the most of clean energy

We work in partnership with our customers, helping them to make the most of renewable electricity, no matter the size of the business or what their drivers are. The rationale behind businesses wanting to become more sustainable is not just being driven by increased pressure from the government, though this may be a contributing factor. Companies are also realising that renewable electricity makes perfect business sense, particularly as part of a wider energy efficiency programme. This includes using smart meters to help businesses track exactly what they are using and how much it is costing them, so they can use the data to use their energy more effectively and help save money. This is especially critical to SMEs who need to keep track of their outgoing costs and manage all their expenditure closely.

Some businesses have taken this a step further, by taking advantage of government initiatives, and have started to self-supply using a mix of solar, wind, biomass or hydro energy generation on their own premises to be as sustainable as possible. For SMEs, switching to renewable energy or self-supply can provide a lot of unforeseen benefits. A good example of this, is one of our small business customers Low Costa Mill, which operates a collection of seven holiday cottages in the Yorkshire moors. The cottages run on a mix of self-generated energy and renewable electricity provided by us. This mix has enabled Low Costa Mill to be awarded Gold Eco Leader status on TripAdvisor, which has not only boosted their overall profile but has also driven more customers to stay and book holidays with them. Speaking to the owner, he made the point that they are picking up extra customers who choose the cottage due to their green credentials.

Data and energy usage

Data is key for any small business. As part of its energy strategy, Low Costa Mill, uses automatic meter read (AMR) meters to keep track of the exact amount of usage. This allows them to understand exactly what it is they are paying for and be in control of their bills. To measure the return on investment of the self-supply set up the owners monitor their daily consumption (every 30 minutes) through the AMR meters. The investment they made in renewables has resulted in lower energy bills, and contributed to them doubling their occupancy rates.

The ideal future for the energy industry, beyond meeting the targets set down through regulation, would be the ability to provide the UK with 100 per cent renewable generated energy, but this prospect is some way off. The challenges we see lie in the stability of the UK’s electricity system and the improvement of battery storage. With the energy landscape evolving towards more renewable and sustainable options, there is a growing interest in battery storage and demand side response programmes.

We view the UK’s renewable energy and climate change commitments as achievable and by partnering with similarly-minded businesses we want to help make this happen.

Paul Sheffield is chief operating officer of Haven Power.

Further reading on small business energy

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