Organisations facing ‘significant headwinds’ as energy market volatility blamed for ‘stunted growth’ over the past 12 months

New data from Centrica Business Solutions has revealed that 40% of European businesses have seen their growth limited over the past 12 months due to volatile energy prices, with this figure slightly lower in the UK at one-in-three companies.

As part of the new report ‘Energising a Greener Future: How data, onsite generation and leadership strengthen energy control’ Centrica surveyed 500 organisations throughout Europe to assess the challenges they face in meeting energy demands. It revealed that further to energy prices, other challenges included adapting to legislative changes where only 16% believe they have good control over their organisation’s response to new rules and regulation. Further, the rise of both flexible and remote work has left almost half of businesses (43%) saying that a distanced workforce makes it harder to predict and respond to energy demands.

To better manage energy usage, the research identified data and analytics as a critical means to success, with 58% of survey respondents saying that they will not feel in control of energy use until they have better-quality data. this was expressed more strongly by those responsible for energy management (67%) and senior executives (68%). It means that tools which monitor and provide insight into energy data will be crucial for companies hoping to take control of their use and improve efficiency.

Cleantech investment planned, as businesses seek energy stability

In a further attempt to address fears and uncertainty around market volatility, Centrica’s research found that more than half of European businesses (57%) are planning to increase their onsite energy generation within the next 2 years[i], with 60% of UK businesses planning to do the same.

The main purpose for doing so is to mitigate price volatility in the energy market, with 40% of respondents claiming this as a reason, followed by a desire to meet decarbonisation targets (39%) and to increase profitability (38%). In addition, half of the businesses surveyed said that reducing energy costs was more important to them than addressing their carbon footprint, and over a third of firms said they would not invest in on-site generation if it did not provide cost savings. The report also found a potential need for education and training if on-site generation is to continue to expand, with 38 percent of firms claiming they lack the knowledge and understanding to introduce the technology.

The potential boom in the European cleantech sector comes in the wake of reports that cleantech investment in the United States surpassed $300 billion last year, following the passing of the Inflation Reduction Act. The Sustainable Energy in America Factbook revealed that $303.3 billion in energy transition financing was deployed last year in the US. This figure includes spending on renewable energy, electric vehicles and power grid investment. It means that on a global scale the US’s investment is second only to China, which spent $676 billion last year.

Cleantech set to deliver a stellar year

The global Cleantech sector is presently on course for a record year. Zero Carbon Academy’s new research due for release this summer will quantify investment on an annual and sector-by-sector basis, drawing out key players and companies to watch as VC interest in the sector continues to accelerate.

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References

[i] How data, onsite generation and leadership strengthen energy control | Centrica Business Solutions

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