By Phil Ivers – Head of UK Operations & Independent Suppliers, Gazprom Energy
The impact of Covid-19 has left almost every industry in a state of limbo. Never could we have imagined just how quickly and aggressively the virus would take the world by storm. Energy suppliers and network companies have continued to operate as close to normal as possible, albeit remotely in many cases, working to the same rules and obligations put in place by Ofgem before the global pandemic started.
It has become increasingly important that energy suppliers work closely with customers to help them navigate the impacts of the global pandemic by offering support and guidance when it comes to energy management. With some factors still unclear, it is important to consider what we know now, and what we hope will be made clear in the future, to help reassure customers.
What we know:
Without knowing when we will return to normal, even with the introduction of the vaccine, the energy industry faces uncertainty as some businesses, despite all their best efforts will not have survived the pandemic, while multi-site businesses may only reopen a limited number of their sites in the short to medium term. Energy will continue to be one of the larger overheads for many businesses, making energy management particularly important for those operating with limited budgets. Whether organisations were temporarily closed, implemented reductions in operations, or have seen increased operations, each should consider the possible impact of the current global economic recession and how this will affect their business down the line, taking steps to mitigate risks to avoid additional financial impact.
Planning ahead is crucial right now and businesses should be putting comprehensive plans together that include energy management considerations, with a view to minimising overheads. Companies that have reduced operations are likely to be experiencing a reduction in energy usage. The harnessing of technology such as automated meter reading (AMR) devices and smart devices will help to make energy consumption more transparent. Businesses of all sizes will experience the need for greater visibility from their supplier in terms of their usage, putting emphasis on the provision of data, which should be available as part of an energy supplier’s service.
- Submit your meter readings every month so that you are being charged on actual usage and not estimated usage
- To make sure you’re billed on accurate usage, request an Automated Meter Reading (AMR) device or smart device (if eligible) to be installed if you don’t already have one – at Gazprom Energy we are still offering COVID-safe installations
What is still unclear:
It is impossible to know what the post-Covid-19 world will fully look like. Customer buying behaviours are difficult to predict, particularly in sectors such as retail. The traditional peaks of online shopping may have become a thing of the past as consumers turn to the internet to fulfil their needs. While it is clear that businesses are suffering and we are potentially facing one of the worst recessions our country has ever seen, the extent of this is as yet unknown.
What we know:
The impact of Covid-19 has meant that parts of the wholesale gas market hit their lowest prices since 2007 earlier this year. Securing a fixed price energy contract when prices dropped meant businesses could take advantage of lower prices for periods of up to five years. Businesses should be double checking when their contract ends, as failing to put a new contract in place will result in being moved to ‘out of contract’ rates which are typically a lot higher than standard rates.
- If your contract is up for renewal or you are out of contract, secure a fixed price contract that allows you to budget more effectively but only if the prices are right for your business – make sure you shop around for the best deal for you. If you are on a flexible purchasing agreement, continue to track prices in relation to your usage. Our EPD team are open and available if you want to buy/sell energy*
Businesses should also be aware that although they may not have been using energy in lockdown periods, in most cases they will still be billed for the standing charge fees associated with energy supply. It is crucial that you communicate with your supplier as early as possible to discuss possible solutions to financial challenges, such as extended payment terms.
- Speak to your energy provider about changes in your consumption as soon as possible and remember that you may still have to pay standing charges
What is clear to us all is that there is nothing normal about 2020 and the unique business environment it has created. In order to prosper, businesses need to be agile enough to change with circumstances and reduce as many unnecessary overheads as possible to have the best chance of being a viable business again once this second lockdown passes. Your energy supplier can play a key role in helping you do that.