PwC & Energy UK B2B Survey
The transformation of how businesses manage their energy needs
Our approach
Two years on from our first survey exploring the energy investment choices in the UK business sector, we have found that how businesses manage their energy choices continues to transform, but the drivers behind this are evolving.
To make sense of the latest trends, we surveyed over 500 businesses; from the smallest energy consumers up to the largest industrial manufacturers right across the United Kingdom. The questions we posed covered a diverse range of topics including relationships with energy suppliers, energy investment choices, investment intentions, who businesses trust, and all the main factors that were driving these decisions.
“As a country, we need to make energy efficiency a top priority for business and the UK energy industry has a key role in working to achieve this.”
The findings
Explore our infographic to see that while energy efficiency, and the saving in energy costs it can bring, remains critical to UK business, our survey shows a stark contrast in the main factors influencing energy investment decisions in comparison to PwC’s previous analysis in 2017.
SMEs
SMEs represent the traditional approach to energy efficiency: energy price focused and worried about the effect of rising energy price on their business.
However, when engaged (i.e. they have a written energy strategy) they will favour renewable energy sources.
- 42% of smart energy investment decisions are driven by reducing energy costs.
- Energy consumption monitoring, smart lighting and EV charging (to reduce fuel costs) are most frequently planned investment.
- More SME energy strategies contain a renewable energy target (42%) than any other feature.
Commercial
Commercial businesses are powering the B2B revolution in terms of bringing in a wider social and environmentally responsible outlook to their energy choices, while being less focused on achieving a lower energy price.
- Only 21% of smart energy investment decisions are driven by reducing energy costs, the lowest of the personas.
- Commercial businesses with an energy strategy are most concerned about environmental/ sustainability issues (33%) than energy prices (27%).
- 47% plan to invest in renewable generation with 40% of these expecting to invest over £500k.
Industrial
Industrial energy users are straddling the old and the new: they are a blend of environmentally and energy price driven businesses.
The greater energy intensity of these businesses has also given the B2B smart energy market scale, given they are the heaviest adopters of technology.
- The most likely product to have been invested in so far (48%) is energy consumption monitoring hardware but renewable generation (46%) is the most planned investment.
- 91% of businesses that installed energy monitoring reported it has improved the running of the business .
- 27% last switched their energy supplier because they were offered an innovative product or hardware.
Large Local Authority
Local authorities are required to minimise public expenditure where possible and as such are the most price sensitive grouping found in the B2B smart energy survey.
However public responsibility is prominently featured as the provision of electric vehicle charging points is driving investment.
- 67% of large local authorities have invested in EV charge points to date.
- 87% were most worried about rising energy prices or rising energy taxes and levies in the next two years.
- 53% base investment in smart energy on trying to reduce energy costs, up from 43% in 2017.
Time for businesses to turn good intentions into sustainability commitments
The appetite among businesses to invest in smart and sustainable energy technology is stronger than ever. However, businesses are also more aware of what outcomes they want from this investment.
Suppliers helping to meet the aims of energy consumers need to act quickly to understand the changing procurement habits. Businesses now have the knowledge to choose the best sustainable sources or providers of energy for their unique needs. There is significant pressure on all suppliers to evolve alongside to meet these ever more specialist demands.
“Only two years ago, energy price was the main game in town - but that’s certainly not always the case now. Suppliers – from traditional to disruptive, new entrants – will need to adapt their approaches as the fight for market share within the energy transformation heats up.”
Conclusion
The key foundation of this transformation are the businesses themselves. Across the country, they are becoming more sophisticated in respect to their energy choices and with more businesses than ever becoming engaged, a growing opportunity exists for companies aiming to supply, install, maintain or optimize the energy technologies that they are employing to execute their strategies.
However our survey has found that it is a fast moving market with priorities significantly different from just two years ago to now. If a supplier into this market is not able to adapt this changing landscape then businesses have the power to find those who can.
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