September 9, 2011

Going Up, Up…It’s Time For Change

Filed under: business energy — Tags: , , — Newsroom @ 10:08 am

In a week which has seen Eon increase its electricity prices to business customers yet again, you wonder how many more increases the beleaguered small business owners will be able to absorb before bursting.  Although this increase is less than 4% it represents an irritant which sees one or another of one of the six main energy providers adjusting their prices upwards every month.

The Regulator has already instructed a team of independent accountants to investigate into the way that the main energy providers conduct their business.  Although the results of their deliberations won’t be known for several months, surely the energy providers have realised that they have been put on notice.   They can’t continue to create difficulties for businesses throughout the UK without being brought to account.

In a world where business owners need to have all their wits about them in order to keep their businesses afloat, electricity and gas are basic necessities required by every company.  There has to be a way to provide heat and light, let alone power the myriad of electric appliances without which no company – or home – can manage.  Yes, we know of programmes where families manage without gas and electricity – however they require coal and other alternative energy sources.

It surely should be a given right to have basic necessities provided at an affordable figure.  We know that small companies and shops are closing at an alarming rate where thriving villages have been turned into nothing but ghost towns.  People can’t buy provisions, the village school has closed and the post office has disappeared.  Whilst these are, to a certain extent, caused by the huge supermarkets taking trade away from the independent retailers, another reason for these closures is in the high overheads being incurred in order to keep village shops and small businesses trading.

Small businesses want to make a profit – absolutely, but they are not wanting to be greedy.  What they want is to make enough of a profit to sustain their family.  Once any staff members have been paid and the running costs allocated, the business owner needs to be able to house, feed and clothe his family – and of course, pay his energy bills!

The provision of energy is a wonderful thing, and where would we be without it?  We are all aware of the cost implications in giving us clean, safe gas and electricity.  There is a huge mountain of costs and organisation necessary to bring gas into a small village where they have previously managed without it.  Yes, they have managed, but in a progressive society where everything evolves and moves forward (hopefully) they are entitled to receive the same facilities as other communities.

Instead of always thinking about profits, perhaps the big six energy providers should concentrate on being a service industry.  They want to survive so perhaps it’s time for them to provide a better service.

Any other business receiving as many complaints as they have, and still are receiving, couldn’t continue to remain in business – perhaps that’s something to consider.

August 26, 2011

Another Energy Company Squeezing…And There Are No Pips Left To Squeak!

Filed under: business energy — Tags: , , , — Newsroom @ 9:35 am

In Northern Ireland electricity bills are expected to rise steeply with Power NI increasing their prices by 18.6 percent from October.  This huge increase will affect both business and residential users and is more than four times higher than the rate of inflation.  Residential consumers’ energy bills are now anticipated to be in the region of over £2,000 per year which is about £900 higher than the rest of the UK.

The Federation of Small Businesses (FSB) is concerned that as the business user will be hit twice by these increases as they will affect both the business and household bills.  This will be another hurdle to overcome for small businesses on their way to economic recovery.  Power NI are blaming the price hike on rising wholesale oil and gas costs and say that this is the first rise they have imposed on their customers for three years.  They say that tariffs were reduced by 15% in 2009 and frozen last year, and they further explained that over the last two years the wholesale fuel used in the generation of electricity has increased by 60 percent and unfortunately they can’t hold their prices any longer.

The Utility Regulator has commented that Northern Ireland depend heavily on fossil fuels, particularly gas, in the generation of electricity which means that electricity prices are especially susceptible to increased energy costs on the international energy market.

This week has also seen the Energy regulator Ofgem increasing their investigation into the way the six major energy providers calculate their profits.  They (Ofgem) have appointed a team of specialist accountants to look at various parts of their businesses to establish how they are able to justify their increased prices.  The independent accountants view will be to improve the transparency regarding the pricing decisions made by the energy providers and clarification about the retail prices and wholesale energy costs.  The results of these investigations are expected by the end of the year.

The energy providers have increased their charges to consumers by a large amount which is sure to create anxiety and worry for both business and residential customers.  At a time when small to medium size businesses are tightening their belts these huge increases may be enough for many small businesses who were already struggling, to abandon their businesses, which will inevitably lead to further unemployment.  Business owners really must be vigilant in ensuring that they do not waste energy.  It is one of the few overheads that if the customer is careful and minimises wastage, that the bills can reduce.

Residential customers also need to ensure that they don’t leave lights switched on when they are out, and that any electrical product is switched off when it isn’t in use.  Over a period of time this will become second nature.