There’s no getting around it: electricity prices are on the up. For the UK and most of the world, energy prices are skyrocketing.
So how can you explain what’s happening to your customers? And how can you help them to keep business costs down?
Why are electricity prices rising?
A combination of economic, political and climate events has led to continuing rising electricity costs. These include: rising global gas and coal prices, increasing transportation costs and unexpected outages reducing output at multiple generators. The Russia-Ukraine war has led to further instability and created a supply shortage (due to countries rejecting oil and gas from Russia), while extreme weather events continue to cause sharp and erratic increases in demand. These factors have led to higher wholesale electricity costs for retailers.
Are electricity prices likely to come down soon?
In a word: no.
Retailers’ costs of managing highly volatile prices in turbulent market conditions ultimately get passed on to consumers in their electricity bills.
In the short to medium term, the best way for consumers to manage their energy costs is to reduce consumption through efficiency measures such as energy-efficient lighting and heat pumps – and to start generating their own on-site electricity e.g. via solar panels.
Show customers how for £0 upfront they could be cash-flow positive
One of the major obstacles to installing renewable-energy infrastructure or other energy-efficient solutions can be the upfront cost. Often organisations don’t have the budget or they prioritise spending elsewhere in the organisation. Even if they agree it will help them tackle rising energy costs, the capital required may be impossible to muster.
But if they purchase energy-efficiency equipment using a Payment Plan, they pay £0 upfront. Their Payment Plan application can be instantly pre-approved – which means they can install energy-efficiency equipment straight away and start saving.
Best of all, Payment Plan monthly instalments are typically lower than electricity-bill savings.
This means your customers can often enjoy a cash-flow positive position.
Which is excellent news for their bottom line.