It may be encouraging news that new Prime Minister Liz Truss is willing to act to support households and small businesses by creating a government-backed super fund to distribute loans. However, businesses are largely not protected by any energy price cap, and many fixed rate deals expire this October.
Like many managing agents, we work with partners to negotiate energy baskets at competitive unit prices. We used pricing hedging techniques to protect customers, ensuring energy savings of up to five times the current unit prices. That honeymoon is over, and even the best-negotiated rates across the largest baskets can expect to at least double.
Even bulk procurement and hedging strategies will not fully protect customers and owners from the impact of the energy crisis, especially for their occupied space. In the absence of proactive and meaningful Government support to businesses, and for those of you who have already tried alternative suggestions of snuggling up with your pets or putting tinfoil behind radiators, here are some hopefully more useful low or no-cost measures:
- Educate employees on the importance of energy efficiency
- Measure your energy usage, perhaps via a smart meter from your energy supplier
- Turn off lights and electrical appliances when not in use
- Set your heating lower and program it to go down or switch off after hours
- Undertake regular maintenance checks of your heating and air conditioning systems
- Move thermostats, so they are not affected by draughts, sunlight etc
- Implement some changes – then measure and share your progress
For a small upfront investment, you can start to expand into investing in energy-efficient office equipment and lighting or insulating your roofs and walls.
Real estate has shown remarkable resilience in responding to the pandemic, with footfall at offices and retail schemes continuing to increase. Much of that increase is down to the growing understanding of customer experience and proper engagement with local communities – both topics for another day.
But the sector cannot afford, both literally and metaphorically, to lose the momentum that has been recovered over the past 18 months. The harsh reality is that occupiers, owners and property specialists can only do so much in the short term. Without robust government support to businesses over the winter, real estate could face a very cold winter snap.