Firms under pressure from rising energy prices: report

16/07/2012 - The Australian Industry Group has found businesses are improving their energy efficiency but are still under pressure from rising energy prices.

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The Ai Group report Energy shock: Pressure Mounts for Efficiency Action surveyed more than 300 businesses about their use of energy, their management of electricity costs, their energy efficient practices and their views on related government policies.

The organisation has recommended governments engage more closely with industry in the design, implementation of energy efficiency policies.

It also recommends governments investigate business responses to changing energy prices to determine whether they were impacting on competitiveness.

Ai Group chief executive Innes Willox said the organisation's previous research showed that in the five years to 2010 two-thirds of businesses made no or negligible improvements in their energy efficiency.

However, he said in the latest report the situation has been reversed.

"In the three years to 2012 two-thirds of businesses have achieved improved efficiency performance," he said.

"Three quarters of respondents have now taken or are planning actions to improve energy efficiency."

But he said the actions tended to involve investigation or modest investment, which would limit the results.

While the number of businesses planning to improve their energy efficiency had increased, energy prices had risen substantially.

Willox said energy expenditure as a percentage of turnover had risen by 10 per cent between 2008 and 2011 but were expected to rise by 37 per cent between 2010 and 2013.

"Regulators project that retail electricity prices for small users will have risen 37 per cent between 2010 and 2013, with the two biggest factors being network costs which added 15 percentage points and carbon pricing which contributed to eight percentage points," he said.

He acknowledged that rising energy costs had driven many businesses to improve their efficiency.

"Most respondents described energy costs as a major expense," he said.

"This appears to have been a catalyst for action by businesses to improve their efficiency, although most businesses will need to do more to blunt the impacts of rising energy costs."

Source: AAP

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Have your say...

Goldie | 16/07/2012 20:25 1

CAN SOMEONE PLEASE DECIPHER " NETWORK COSTS" AS IT TELLS ME NOTHING ABOUT SOMETHING THAT CLEARLY HAS NO CEILING NOR AN END. IT's A CROCK, IT HAS NO MEANING AND IT IS DELIBERATE.

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