Finding good advice to address business energy needs is more crucial than ever as market conditions continue to be volatile. While other priorities took precedence during the pandemic, energy is moving up the agenda once more for businesses.  

The spillover from the Ukraine conflict, combined with domestic supply problems, led to a crisis in June 2022 that precipitated the temporary suspension of the National Electricity Market. High prices now characterise wholesale markets, both the present-day spot market and subsequent years’ futures prices. 

As energy costs continue to rise, businesses must pay close attention to their energy usage and explore different options to minimise costs.  

While it may seem like a simple matter of finding the cheapest energy source available, the reality is much more complex. This is where seeking expert advice becomes essential. 

The Business NSW report – Unfinished Business: Putting small business energy policy back on the table – surveyed almost 700 businesses and was supported by grant funding from Energy Consumers Australia. The report found there was a clear inverse relationship between the level of usefulness of a source of advice and its current degree of utilisation by businesses. 

The most used sources of advice to business were among those they found least useful, while the most useful sources of advice were among the least used. 

Business/engineering consultants and peak bodies were seen as the most useful sources of advice (more than 50% report them being very or extremely useful), but fewer than 15% of businesses had sought advice from those sources. 

By comparison, energy companies and online research were identified as the least useful sources of advice, yet these were by far the most commonly used sources of advice. 

“For many businesses, where you start looking is probably the hardest bit,” Anthony Cooper, My Business Executive Manager, Energy Programs, said. 

“That’s why we see more people going into their energy retailer and just Googling because they don’t know what else to do. Peak bodies and engineers are the best places to go to, but customers aren’t aware that we can help them.” 

The survey also found that businesses were most motivated to seek advice by financial drivers – the desire to reduce financial stress, improve profitability and improve the efficiency of energy usage in their business. About 38% sought to protect the environment, and 19% sought energy advice that could lead to benefits for their community. More than a third of businesses aimed to become less reliant on the electricity grid. 

Meanwhile, of the businesses that had received advice, 70% reported that it had led them to make some changes to their business. Of those that did not make changes, the most commonly cited reasons were lack of funding (44% of responses) followed by lack of time (27%). Access to finance continues to be a significant barrier to improving energy productivity. 

Business NSW Policy Manager, Infrastructure & Utilities, Simon Moore said that expanding businesses’ access to advice from trained engineers or peak bodies with industry sector expertise potentially offered a significant improvement in the value businesses place on the advice received. 

As a peak body that has provided expert energy consultancy to businesses over recent years, Business NSW is supportive of efforts to expand this model of advice delivery to SMEs. To reach more businesses in the years ahead requires a new program with an expanded remit and with resourcing to maintain advice that is free and independent. 

“I think that the primary issue is the level of understanding of what an individual business needs. Providing advice that is very specific to the circumstances of an individual business is much more difficult and we know that there is a lot more diversity within the small business sector than there is in the household sector,” Mr Moore said. 

“For example, a small manufacturer and a warehouse next door that occupies essentially the same type of building but whose energy needs within that building can be completely different. Drawing on the expertise that is provided by peak bodies and trained engineers can better understand the nature of the business when solving their energy needs.

“That’s why we're calling for the creation of a new program to expand business access to meet the needs of small and medium-sized businesses and that can address the challenges of the energy transition, the net zero economy as well as the financial implications of energy."