Concern about spiralling energy prices has peaked in recent weeks, with many analysts predicting double-digit rises over the next few years. Much of the focus has been on how this will affect homes during the winter months but the impact on the UK's growing businesses also needs to be addressed.
Peach Pubs is a group of 15 gastro-pubs and like many in the hospitality industry, certain parts of our operations are particularly energy-intensive. The lighting and air-conditioning in our restaurants, for example, and the running of our kitchens, many of which maintain several hobs for up to 12 hours a day, use a lot of energy. Our business is expanding but with our energy costs at just under 500,000 per annum, this represents a significant amount of money which we'd prefer to spend on supporting growth.
The majority of business owners are only too aware of the need to cut energy bills but according to new research by the Carbon Trust, there are three main barriers limiting their ability to act: insufficient time and resources; being able to quantify the expected returns; and energy efficiency taking a lower priority than other business considerations. Access to capital to purchase new energy-efficient equipment is also a challenge as banks are often unwilling to lend and any project needs a clearly defined, short payback period.
These barriers are certainly familiar to our business. We want to focus on ensuring that guests enjoy our pubs rather than spending time evaluating different aspects of our energy consumption. But work in this area must go on. We have recently installed, for example, new induction hobs in our kitchens, which only heat up when a pan is put on them – this will make a big difference compared to gas hobs running throughout a shift. However, evaluating the different parameters and calculating the business case for implementation took over four weeks.
We've also looked to encourage behavioural change among our team. This has little or no capital cost but does require management time and training budgets. Some examples of this include "Peach Heroes" which offers recognition and 200 vouchers as rewards for staff for new ideas which enhance our business, including suggestions about energy and sustainability. Investment in energy efficiency equipment does require capital expenditure but delivers tangible, long-term returns and requires internal resource to deliver.
The key to overcoming barriers is to simplify energy efficiency: to provide an objective means of comparing technologies and different approaches and making it easy to quantify the returns. Every business has its own distinctive pattern of energy use and certain measures will have a quicker impact in each instance.
At our Brookmans pub near Potters Bar, we've carried out detailed analysis and decided to install LED lighting throughout the premises. Although the initial costs are 26,000 compared to 13,000 for traditional lighting, the running costs drop from 9,000 per year to just 900, meaning it will pay for itself in just over a year.
Over three-quarters of companies (76%) are more concerned than they were six months ago by rising energy costs and are very worried about its impact on business.
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