Monthly Archives: April 2016

ESOS

Energy Saving Opportunity Scheme Phase 2

We have now passed the deadline period for phase 1 of the energy saving opportunity scheme (ESOS), this first phase required businesses to undertake mandatory energy audits if they fit into a certain business size.  Businesses that acted earliest in Phase 1 by appointing a lead assessor, collecting data and analysed systems and processes, were among the organisations that reduced costs and maximised returns.

ESOS background

The Energy Savings Opportunity Scheme (ESOS) is a legislative policy that has been introduced by the government, in response to the European Union’s Energy Efficiency Directive and a 20% energy reduction target by 2020. It is mandatory, for all businesses that fall into the category of more than 250 employees or a turnover that is larger than €50 million (£38,937,777) and has a balance sheet in excess of €43 million (£33,486,489) to participate in ESOS.

Phase 2

If you missed the 5 December 2015 deadline, you will need to declare why you missed the compliance deadline and start the ESOS process to avoid enforcement action. If your business did not qualify, then ESOS is not mandatory, however you are recommended by to complete the ESOS process.

Qualifying criteria:

• You have more than 250 employees in the UK; or
• You have fewer than 250 employees, but have:
– an annual turnover exceeding €50m; and
– a balance sheet exceeding €43m; or
• You are part of a corporate group containing a ‘large undertaking’.

If you remain in scope of the scheme, you must then undertake ESOS assessments within each subsequent phase. Phase 2 commenced on 6th December 2015 and will run until the 5th December 2019. Businesses that are close to the qualification threshold or have substantially increased in recent years should also participate in the second phase, as accounts over a two year period, with anticipated and actual growth rates are considered.

How will Phase 2 impact my business?

If your business falls within the qualifying criteria, you are required to work with a lead assessor to undertake various roles in relation to your ESOS assessment. Your assessment should audit 90% of your total energy usage for one year, and present the results along with the identified efficiency opportunities and your evaluation of lifecycle costs to the regulator and keep a copy of the data.

GET Solutions are on-hand to offer you solid support and advice, and to guide you through any potential issues you may face during the ESOS process. We’ll make your ESOS journey as easy and cost effective as possible. Some of the ESOS areas we can assist with are Cavity Wall and Loft Insulation, Boiler Room Optimisation, Building Optimisation, Metering, Solar PV and LED Lighting.

Contact one of our experts to find out more.

 

 

 

Flexible Purchasing

The increase in media and social awareness allows the customer to ask whether their tariff matches their needs…

As media and social awareness increases, energy prices are placed under the microscope resulting in customers actively asking brokers and suppliers alike if they are on the correct tariff, and if that tariff is the most competitive for their needs. This increased awareness has also resulted in clients looking at the way they purchase their energy, with clients now turning towards a more flexible way of purchasing which puts the emphasis more so on the broker or supplier to inform them about market fluctuations, changes within the industry and ultimately, at what state the market is in, and if they would be better or worse off if they purchased at that time.

Traditionally, energy contracts are acquired through one transaction, whereby the market rate at that time is taken; resulting in a p/kwh value for the specified duration that the client requires from 12 – 60 Months. However, with Flexible Purchasing your energy consumption can be broken down in a way that the customer can purchase different percentages at any time. These multiple purchasing decisions can be tailored to suit your needs from Monthly, Quarterly or Seasonal acquisitions or to clip sizes that enable you to maximise flexibility and facilitate any strategies you may have.

Flexible Purchasing chart 1
If we take a look at the above graph, which charts the course of Electricity (Front Month) prices since December 2015, with the right purchasing platform the client would be able to purchase their energy at a time where there is a dip in the market, allowing them to take advantage of the low commodity cost. By purchasing in this way, the client can look to reduce their Annual Spend, however, the market does not always go downwards and externalilties can heavily influence market direction in a matter of seconds; therefore if purchased incorrectly or not purchased at all, customers may see their spends increase.

That is where regular dialouge between the Customer, Broker and Supplier is key. If the customer is informed correctly and a platform of honesty and trust is created between all parties, clients can really see a difference to their energy spend. Flexible Purchasing is just that, there are various products available within that field that can place as much emphasis on the Broker/Supplier as you desire or put you, the customer, at the heart of any decisions. Triggers can be set, whereby once the market reaches a certain level a % of your yearly usage, energy can be brought or you can even pre-purchase a % of your yearly usage at a fixed rate and float the remainder until there is a dip in the market.

Flexible Purchasing chart 2
There are many more options available that can help you to reduce your spend, so to learn more please contact one of our experts………

call-to-action-button


Topics of Interest:

Energy Industry Update P272
Removal of CCL Exemptions
GET your FREE Water Health Check

Revised Forecast Highlights Further Costs to Electricity

Revision to Third Party Charge Forecast

Our recently revised ‘third party charge’ forecast, which includes: Renewables Obligation (RO), Feed in Tarrif (FiT), Contracts for Difference (CfD) Capacity Market Charges (CMC) and Assistance for Areas with High Electricity Distribution Costs (AAHEDC) all bear a similarity, they’re all expected to increase during the period 2016-2022.

But of particular interest CfD and CMC are expected to increase significantly, of which CfD faces the first of its price hikes in 2017-18 jumping from 0.0887 pence per kWh to 0.2720 pence per kWh. Both CfD and CMC forecasts then ramp up annually from 2018-19 onwards jumping from 0.2720 to 0.8784 pence per kWh and 0.0099 to 0.2781 pence per kWh respectively.

Additionally the Feed in Tariff and Renewables Obligation forecast has also increased from previous forecasts.

So what does this mean for electricity consumers?
Essentially, prices are expected to hike, and as is so often the case, it is not just the unit cost of energy that is the cause of price increases. Third party charges as detailed above are added to supplier’s costs, profits and wholesale energy costs when determining the price you pay for your energy, and unfortunately, they are expected to stay and keep rising for the foreseeable future.

Specialist energy consultancy GET Solutions offer a range of products and services, and will provide intelligent recommendations based upon clients unique circumstances and market conditions. Our purchasing power enables us to secure the very best energy deals, and with 5 year plans with mix and blend options, we can safeguard your energy costs and advise you when and which energy product to buy to take advantage of market fluctuations.

For further information or advice please contact us on Tel. 024 7630 8830 or email corporate@getsolutions.co.uk