Food manufacturing industry missing millions in energy cost savings
Tuesday, 10 May 2022
Despite spiralling energy costs, more than two thirds of UK manufacturing businesses are missing out on millions of pounds of savings because they do not understand that alternatives to power from the National Grid are available.
According to research commissioned by Ylem Energy, an independent power generation company that specialises in on-site generation, 68% of businesses indicated that they only have a general understanding of the issues affecting the energy market and limited or no awareness of the benefits of on-site generation.
More than half (57%) also confirmed that rising energy costs had significantly, or very significantly affected net zero plans while 85% indicated they would increase their own prices, if energy costs continued to rise, fuelling inflationary pressures.
Ian Gadsby, Ylem managing director said: “On-site energy generation is a proven means of reducing costs by removing additional charges associated with power from the grid, such as peak rate tariffs and the non-commodity charges that make up more than half a typical commercial electricity bill. By generating power on-site, businesses can avoid these non-commodity costs altogether, as well as the risks of fluctuating energy prices.”
Ylem is now working with several manufacturing companies to speed-up their move to on-site generation and the installation of a 1MW solution at a food manufacturing business in Scotland has enabled the company to generate 74% of the power previously sourced from the National Grid, saving an estimated £2.8 million over the next few years.
Mr Gadsby added: “We are receiving a significant number of enquiries about on-site generation from manufacturing business being hit hard by the spike in energy prices, but millions in savings are being missed, either because they aren’t fully aware of the benefits of on-site generation, or they have previously dismissed on-site solutions as too costly.
“The fact is on-site generation solutions offer guaranteed savings without CAPEX or any additional costs, provide pricing stability at a time when the energy market is more volatile than ever, and can help businesses remain competitive, rather than having to increase their own prices. In some cases, companies will actually be able to sell excess energy back to the grid.
He added: “Our research also indicated that nearly a fifth (19%) of manufacturing businesses no longer consider net zero a business priority in the wake of rising energy costs. The reality however is that the UK will not be able to reach net zero unless businesses lead the way. Not only can on-site generation significantly reduce costs, but the adoption of renewable on-site energy generation can be a significant step towards net zero for many companies, and thereby help the UK to achieve its legally binding climate change targets.”
While not all companies are able to take advantage of on-site generation, Ylem says that the rapid adoption of on-site generation by large energy users such as food manufacturing businesses is one way in which the UK can create a more robust, efficient, and affordable energy system.
Notes to editors
Ylem Energy Ltd is a leading independent power generation specialist with more than three decades’ experience in building, owning and operating smart generation systems.
We specialise in delivering state-of-the-art generation systems that fully integrate with the sites they serve, investing millions in projects that help our clients on their way to net zero and support the UK’s legally binding targets for tackling climate change and decarbonising the grid.
To find out more about Ylem Energy, please visit https://www.ylemenergy.com/
For further information contact:
Tel: 01457 820807
Ylem Energy Ltd are exhibiting at The Distributed Energy Show 2023 on stand 4029.