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Making the best of the current situation and take the opportunity to lower your overheads

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I just wanted to draw your attention to a potential opportunity for your company to put in place energy contracts now to reduce UK energy bills going forwards, due to the fact that wholesale energy prices are currently at a 10-year low. 

 

 In addition to this, other factors to consider:

 

  • Risk of energy suppliers withdrawing from quoting for new business
  • The current economic climate means that many businesses will see their credit position affected or their industry implicated generally – (this is already happening for pubs and restaurants). In turn this may see well introduce credit terms imposed (insurance mark ups or security deposits).
  • Take or pay – Many gas contracts have these clauses which have min and max usage requirements. As businesses close their doors, this doesn’t affect the contract so they may well end up having to pay for 85% of their contracted usage even though they are closed.
  • Lease equipment – Many companies have finance agreements on equipment (CHP/Voltage optimisation/Solar etc), these are often charged on a generation perspective – so x pence per kWh saved or generated, but also include a minimum amount. During this time, many will be caught out by these minimum figures which should be able to be negotiated away as ultimately they are finance agreements and the client can try to extend their finance agreement and apply the equivalent to a mortgage holiday.

 

The team at Chapter Three Consulting are able to assist with putting in place energy strategies and provide assistance on all utility challenges.

 

For more information, call Eddie Finch on 07989 680002

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