Most small businesses want renewable energy – but can’t find a supplier to provide it
A significant majority of small and medium-sized businesses (SMEs) want their energy supplier to be more committed to renewable energy, according to a new report that looks at how the SME sector regards energy supply.
The report, commissioned by Haven Power, revealed that while 72 per cent say they would like energy suppliers to be more committed to renewables, only 11 per cent would rate their current energy supplier as excellent when it comes to renewable energy support and options.
Much of the energy supply sector is failing to meet SMEs’ demand for more renewable energy and this comes against a general backdrop of high dissatisfaction with suppliers amongst SMEs:
- As many as 73 per cent of SMEs label value for money as a main priority (this increases to 94 per cent for SMEs with between 5-25 employees), and yet just 23 per cent believe they are receiving an excellent deal. Although, in theory, they can shop around to get better deals, the reality is that few actually switch to a new supplier.
- Almost three quarters of SMEs (71 per cent) agree that it should be simpler to switch supplier. But the scale of the difficulty in switching is clear to see and could be the reason that one in five (21 per cent) of those who tried to switch didn’t end up with a new supplier.
- Interestingly, the third factor that is likely to stimulate a switch (after price and service) is the offer of renewable electricity. In fact, more than one in five (22 per cent) told researchers that they would stay late at work to switch suppliers if they could purchase a completely clean energy product. For the largest-sized SMEs (101-250 employees), this rises further to 28 per cent.
- In addition, over a quarter (26 per cent) cite that support in being more energy efficient is something that they look for in an energy supplier.
Jonathan Kini, Chief Executive of Haven Power, said: “That so many SMEs are dissatisfied with their existing energy supplier is perhaps unsurprising, but the sheer scale of the discontent revealed in this report remains shocking. SMEs want more from their supplier and a commitment to renewable energy is one of the demands they are pushing for. This suggests there is some fundamental change happening, and we in the energy sector need to respond to it by not only helping SMEs reduce their energy usage but also being able to supply 100 per cent renewable energy.
“The fact that only 21 per cent of respondents believe their supplier is completely committed to renewable energy and almost a third saying their supplier is either not very committed or they are not sure they have a renewable option shows a huge gap in the market for those with a different offer.”
The report comes as Haven Power prepares to launch a new initiative in the Suffolk area, around its headquarters in Ipswich, to help SMEs switch to more renewable energy and become more sustainable. Haven Power’s view of sustainability is rational and practical, and includes not only how power is generated but also how it is used.
Suffolk has taken the lead in driving renewable energy usage following the formation of the Creating the Greenest County Partnership in 2007. Many businesses in the area have already chosen to take advantage of the 100 per cent renewable electricity product from Haven Power, but it is still a small proportion of their total customer base. The new initiative, initially aimed exclusively at SMEs in the Suffolk region, will give businesses the chance to:
- Take advantage of Haven Power’s 100 per cent renewable electricity product
- Receive an energy audit by a specialist, local third party organisation (Business Energy Efficiency Anglia), to identify ways to reduce energy usage and become more sustainable
- Register with the Carbon charter (worth £550), free of charge
- Access grant funding to make improvements identified in the energy audit
Cllr. Matthew Hicks, Cabinet Member for Environment and Public Protection at Suffolk County Council, said: “Suffolk County Council are leading the three-year Business Energy Efficiency (BEE) Anglia project, because the support and guidance it provides is a real benefit to local businesses -helping them to cut costs and be more resilient to changing energy prices. Across the county people are doing their bit to help Suffolk become the greenest area in the UK. Our partnership with Haven Power means that its customers will be fully empowered to go green, become more energy efficient and to save money by reducing their energy use.”
One of the reasons Ipswich was chosen as the first area of the UK to benefit from this new initiative is the high number of digital businesses in the area. Ipswich was a new entry in the 2016 Tech Nation report this year, showing that turnover of digital firms in and around the area grew by 24 per cent between 2010 and 2014, with the sector now employing nearly 10,000 people.
The report shows that digital businesses are particularly eager to switch to a more renewable energy supply, with 80 per cent agreeing or strongly agreeing that they would like their energy supplier to support renewable energy. And yet in this sector, not a single respondent said they received support from their supplier when it comes to using renewable energy.
Jonathan Kini continued: “This research is something of a wake-up call to many in the energy supply sector. It tells us what SMEs want in terms of renewable energy options, and what they expect from their supplier to help them achieve their goals of greener energy and lower usage. This is the Haven Power offer that we’re rolling out.”
Haven Power is part of Drax, a power generator that has made a major move away from coal-powered generation to low-carbon, renewable biomass production. This involves producing electricity from compressed wood pellets that are manufactured from sustainably sourced low value material sourced from working forests. And biomass is not just renewable – it is also reliable, flexible and able to provide a constant source of low carbon energy.
To view the full report please visit http://www.havenpower.com/sme-report
About Haven Power
Haven Power specialises in supplying electricity to UK businesses ranging from small-to-medium enterprises through to large industrial and commercial customers. Since 2006 they have been providing energy contracts that are simple, flexible and designed to meet the wide and varied needs of businesses.
Haven offers customers competitive prices and the option of renewable electricity from innovative Biomass technology.
For more information, visit www.havenpower.com.
About Drax Group
Haven Power is part of the Drax Group plc. Drax is an innovative energy company that owns and operates the UK’s largest power station in Selby, North Yorkshire, typically providing some 8% of the UK’s electricity. A vital strategic asset, the Group has transformed itself into a predominantly biomass-fuelled electricity generator through its use of innovative technology and sustainably sourced wood pellets. The largest decarbonisation project in Europe is underway to provide the UK with cost effective, low carbon, and reliable renewable power.
The Group employs around 1,400 people and also includes:
- Drax Biomass, based in the US and manufacturers compressed wood pellets produced from sustainably managed working forests.
- Haven Power, the Group’s retail arm, providing business electricity contracts that are simple, flexible and designed to customers’ specific requirements.
- Billington Bioenergy, is one of the leading distributors of wood pellets for sustainable heating in the UK.
For more information, visit www.drax.com.
About the Business to business as usual; why customers want change in the B2B energy market for SMEs report
The research consisted of 100 in-depth, qualitative interviews conducted during May-June 2016.
- Respondents had to be decision makers with responsibility for their organisation’s energy supply.
- Respondents had to work in organisations with between five and 250 employees.
- Respondents’ organisations are from a range of private sectors including; manufacturing; retail, distribution and transport; IT; financial services and business and professional services.
The research was carried out by Vanson Bourne.
About Vanson Bourne
Vanson Bourne is an independent specialist in market research for the technology sector. Our reputation for robust and credible research-based analysis is founded upon rigorous research principles and our ability to seek the opinions of senior decision makers across technical and business functions, in all business sectors and all major markets.
For more information, visit www.vansonbourne.com.
About Business Energy Efficiency (BEE) Anglia
BEE Anglia is run by a partnership between Suffolk County Council, Groundwork, Norfolk County Council and NWES. The project is receiving up to £3,258,169 of funding from the England European Regional Development Fund (ERDF) as part of the European Structural and Investment Funds Growth Programme 2014-2020. The Department for Communities and Local Government is the Managing Authority for ERDF. Established by the European Union ERDF funds help local areas stimulate their economic development by investing in projects which will support innovation, businesses, create jobs and local community regenerations. For more information visit https://www.gov.uk/european-growth-funding / www.beeanglia.org.