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On-Site Energy

UK vs EU Energy Security Policy: What you need to know

 960 640 Guest Post
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By David Kipling, CEO – On-Site Energy

In April 2022 the UK published its Energy Security Strategy. The key aim of the strategy is for the UK to achieve long-term independence from foreign energy sources and decarbonise the nation’s power supply. The main initiatives of the strategy are investment in nuclear generation and offshore wind, the latter being the source of hydrogen generation.

Contrasting this to EU energy security strategy (which is far more dependent on Russian gas) the EU highlights rapid action to embrace energy savings, diversification of energy supplies, and accelerated roll-out of renewable energy to replace fossil fuels in homes, industry and power generation.

UK plans are all long-term measures – it takes 10+ years to develop nuclear and offshore wind UK sees oil and gas as an important transition fuel and has set out plans to increase activity in the UK North Sea. In the meantime, CO2 reductions will be incremental at best.

EU has to act rapidly. A strong focus is on supporting energy efficiency and local renewables, which are much faster to implement.  This is also the fastest way to reduce costs and address current energy costs.

If you think about this in the context of our energy hungry industry, I think the right conclusion would be to follow the EU direction rather than wait for the long term measures. There is nothing lost by reducing consumption and using low-carbon generation to control and reduce costs.

If you would like to discuss how to be more energy efficient and use low-carbon energy generation, please contact David Kipling, CEO – On-Site Energy on 0151 271 0037 or email david@on-site.energy (www.on-site.energy).

Routes to deliver net zero

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By David Kipling, CEO – On-Site Energy

Businesses have complicated energy needs, particularly those that use a lot of thermal energy such as for steam or ovens.  Achieving net zero is going to require elements of re-engineering, re-thinking business processes, adopting new technology and changing energy purchasing strategy. But is it even possible in the current climate when those decisions will also directly affect the P&L through changed operating costs.

The main routes to net zero most businesses consider are:

  • Buy green tariffs – and hope they won’t be looked-through as “green-washing”. SECR reporting is starting to highlight energy intensity (how many kWh of energy your company uses to produce 1 kg of product) – which will aim direct comparison with competitors
  • Electrification – and hope the Government will make good on its promises to decarbonise the electricity grid
  • Await Hydrogen to move off gas – another big “if”. When or will it be commercially viable and available ?
  • Invest in energy efficiency

The problem with approaches (1) – (3)  is they will have failed to deliver the change that your customers are looking for anytime up to at least 2030. That could put your business at a competitive disadvantage. Also you are fully exposed to market volatility with these routes.

We believe the right path is option (4), to invest in reducing your energy intensity and also consider low-carbon generation solutions.  This way you reduce your CO2 footprint, reduce your exposure to the grid and are in control of your costs. Also bear in mind that the third round of ESOS is less than 2 years away, and its likely to be mandatory to enact the recommendations of the auditor.  In that ESOS round there is going to be an even greater focus on action on energy efficiency.

The challenge is keeping operating costs under control whilst achieving progress towards decarbonising and deciding when to adopt new technologies.  With a recession looking likely, capital availability may also become more difficult.  We can help deliver measures without any capex from you, using our zero-capex energy partnership solution.

If you would like to discuss how to be more energy efficient and accelerate your net zero strategy, please contact David Kipling, CEO – On-Site Energy on 0151 271 0037 or email  david@on-site.energy (www.on-site.energy).

Do we have to live with higher energy prices ?

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By David Kipling, CEO – On-Site Energy Ltd

The hikes in energy costs on the past 6 months have been nothing short of game-changing. But are they just a spike or are they here to stay ?

At 25 March 2022, the Winter=22 forward energy wholesale price for electricity was 23.2p/kWh and gas 9.0p/kWh.  You need to add non-energy costs and taxes to these, so more realistically electricity will be over 30p/kWh and gas around 10p/kWh.  Looking out to winter 2024 electricity is still at 11 p/kWh and gas is 4p/kWh.  That means Winter 2024 is double what was the norm in the first half of 2021.

So the current “crisis” prices are unlikely to subside to pre-crisis levels, and if you do nothing about it, you are going to have to learn to live with levels at least 100% more than they were in 2021.  How is this going to impact your business or its ability to decarbonise ?

But you don’t have to settle for these prices.  The steps you can take are: (1) reduce consumption through energy efficiency measures and (2) utilise onsite generation to reduce the amount of energy you draw from the grid.

Typically averaged cost of solar PV over its life is less than 8p/kWh and CHP can save around £400,000 per annum per MW installed even with the projected gas prices. With savings like these, every business should be looking at these options.

If you are not sure where to start with energy efficiency measures or onsite generation, we can help. For qualifying companies, we undertake initial evaluations free of charge and can also provide fully funded solutions so that capex needn’t be a barrier. We can also ensure that what is being proposed aligns with your sustainability goals.

If you would like to discuss how to avoid these high grid costs and have a more manageable energy cost for your business, please contact David Kipling, CEO – On-Site Energy Ltd on 0151 271 0037 or email  david@on-site.energy (www.on-site.energy).

Maximise your carbon reduction & cost savings

 960 640 Stuart O'Brien
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By David Kipling, CEO – On-Site Energy Ltd

Whilst the news that Governments’ net zero plans remain intact as a result of the invasion of  Ukraine, current energy prices are at unprecedented levels and are a matter of survival for some businesses.

The good news is that by focusing on energy efficiency and onsite energy generation the likelihood is that you will both save money and carbon emissions. Energy savings and carbon reductions go hand-in-hand.

To develop a carbon reduction plan, you first need to understand your current performance whether that is in lighting, motor loads, chilling, heating or the other main uses you have.

This can then be compared to “best in class” performance.  Knowing what the result of implementing best in class solutions is a good start to formulating a plan and to building a business case for investment.  It will also tell you how close to net zero, so the remaining gap can be considered.

Minimising your exposure to the grid by reducing consumption and generating power onsite is the best way to mitigate the risk from volatile grid costs.  On-Site Energy can help with understanding your current carbon and energy performance, identifying the opportunities for efficiency and energy generation, and then delivering them.

We can also help unlock the opportunities by funding them on a zero-capex basis where some of the savings are used to fund the measures.  Your business benefits from lower costs and the full carbon reduction savings, without needing to spend anything.

If you would like to discuss how to implement energy efficiency measures, onsite generation or develop and roll-out a carbon management plan for your business, please contact David Kipling, CEO – On-Site Energy Ltd on 0151 271 0037 or email  david@on-site.energy (www.on-site.energy).