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Do you truly understand your Energy bill?

Date May 3rd 2017 by in Categories Cost Rationalisation, Energy

Energy legislation such as MOD 0428 and P272 have had a significant impact on the way in which suppliers present your bill, and more importantly, the way that they charge your energy to you. Your energy bills will now look very different to how they have in the past.

Our energy experts keep a close eye on supplier activity and have found that supplier invoices will no longer just consist of consumption information but may include additional charges such as capacity and other non-energy costs, e.g. government levies and National Grid charges.

With the introduction of ESOS, companies are being asked to take a more careful view of carbon management, with emphasis on carbon mitigation and the possible introduction of renewable generation, staff education and also for board directors to have more of an understanding of their business' carbon strategy.

Going forward there are a number of questions that you should be asking in order to become more familiar with your energy usage and subsequent billing.

Do you monitor your own capacity and manage it accordingly?

With the introduction of P272 legislation much more emphasis will be put on the amount of energy you use. Monitoring your capacity is important because, if you exceed agreed capacity limits you may be charged for the excess at a higher rate. If you find that you are regularly going over your agreed capacity we recommend that you renegotiate your package to account for this. Likewise, if you are under using against your agreed capacity you can arrange to get a reduction on your monthly bill. This would, however, need to be reviewed very carefully. 

Do you know who your distributor is and have you arranged a MOP agreement with them?

The P272 legislation has driven the need for people to be aware of who their distributor is, their CT ratio, what their agreed capacity is, and source a meter operator agreement (MOP). This will lead to yet another set of charges that you may not have come across before. As an example, this could be further settlement charges and DC/DA costs to cover the collection and management of Half Hourly (HH) data.

Have you read your terms and conditions and do you understand the implications?

It is very important to have a full understanding of all of the clauses within your terms and conditions. It would be a shame to overlook something that could cause problems for your business' energy supply in the future. The unit cost is just one component factor in choosing a supplier, be careful not to overlook the plethora of other costs that may or may not be presented to you. We also urge clients to ensure that you understand whether they have been forecast fully or whether a pass through element may be imposed.

Are you aware of the impact of your energy usage in peak periods?

In today's energy market we are steering away from a standard pence per unit charging system and are leaning towards a cost breakdown with a need to understand the different elements, what they mean and how we can reduce these costs. The more you know, the more you can be prepared in case you do receive an invoice with unexpected charges on.

At BCR Associates we recognise that businesses don’t always have the resources to go through energy bills with a fine tooth comb on a regular basis. Our team of energy experts can help you to navigate the energy market, assist with forecasting and take charge of managing your energy bills. We have excellent relationships with a wide range of energy suppliers and will support you in understanding the different ways that the various suppliers behave. This includes an in-depth understanding of suppliers' terms and conditions where we can swiftly ascertain if you have committed yourself to anything that will put you at risk. We work hard to stay on top of the latest government legislations and fully understand how these will impact the energy markets and our clients.

We are primed to help you make well-informed procurement decisions by eliminating overpayments and ongoing invoice analysis. We are particularly experienced in multi-site businesses with a designated account manager on hand whenever you need them.

Energy represents a significant spend for most businesses, therefore, making sure that you understand your monthly energy statements is vital to ensure that you are on the best plan and your business is getting good value for money. You should also keep in mind that new government legislation will affect different businesses in different ways. To find out how this will affect your business, please get in touch with your BCR Associates Relationship Manager.


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