Inspired Energy Plc

A Message from Lord Pickles and Lord Blunkett, followed by Inspired Energy Plc's best practice article

The ability to listen and learn from one another has always been vital in parliament, in business and in most aspects of daily life. But at this particular moment in time, as national and global events continue to reiterate, it is uncommonly crucial that we forge new channels of communication and reinforce existing ones. The following article from Inspired Energy Plc is an attempt to do just that. We would welcome your thoughts on this or any other Parliamentary Review article.

Blunkett signature Rt Hon The Lord David Blunkett
Pickles signature Rt Hon The Lord Eric Pickles

www.inspiredenergy.co.uk

THE PARLIAMENTARY REVIEW
Highlighting best practice
34 | INSPIRED ENERGY
CEO Mark Dickinson
Your energy is
our priority
Inspired Energy is one of the UK’s largest energy advisers,
helping private and public sector organisations reduce their
energy costs and usage. It supports and helps clients avoid
shocks to their EBITDA and profits so they are able to focus on
growing revenues and delivering a world-beating performance.
CEO Mark Dickinson tells
The Parliamentary Review
how it
supports 2,000 businesses in managing their energy costs,
allowing them to focus on running a successful business.
We are an AIM-listed company focused on maximising the value of every pound
spent on utilities by our clients and recovering historical overpayments. If not
managed correctly, these issues can impact on the profits, productivity and
reputation of any organisation.
Across the mainland UK and Ireland, we help 2,000 clients with over 100,000 retail,
commercial and manufacturing premises. Collectively they spend £2.5 billion on
energy each year. Failure to manage these costs jeopardises profits and competitive
edge. This is where our team of industry experts help to significantly mitigate that risk.
What is the impact on your business of an energy EBITDA shock?
Imagine this scenario: as a business you make a ten to 20 per cent profit margin,
with your energy spend five to ten per cent of revenue. If energy costs – one of the
highest costs for any business – rise by 50 per cent, a ten per cent profit margin will
potentially become a 15 per cent loss.
FACTS ABOUT
INSPIRED ENERGY
»CEO: Mark Dickinson
»Founded in 2000
»Based in Kirkham, Preston
»Services: The UK’s leading
TPI, helping commercial,
industrial and public sector
energy consumers solve utility
cost, consumption, carbon
and compliance challenges,
any or all of which can
impact upon the profitability,
productivity and reputation of
organisations if not managed
correctly
»No. of employees: 385
Inspired Energy
35INSPIRED ENERGY |
BEST PRACTICE REPRESENTATIVE 2019
Energy costs frequently rise by 50 per
cent. They soared by over 100 per cent
in a single year twice between 2005
and 2008, and by 50 per cent on three
occasions within a single year between
2011 and 2018. Businesses face a
similar problem today, which is where
Inspired Energy can help. So do we
have your attention now?
In order to offset the increase in
energy costs, a business needs to grow
revenues organically by 25 per cent just
to stand still. How many businesses
are doing that in non-financial sectors?
Very few. It’s far better to avoid the
energy cost shock in the first place.
Your challenge
Let’s face it: energy is dull, dreary,
boring stuff. It doesn’t grow revenues;
it doesn’t improve operational
leverage. Every minute spent focusing
on energy costs rather than growing
revenues or improving profitability is
a wasted minute. Yet in a matter of
months energy costs can undo all the
good work of the last decade. So,
make sure it doesn’t occur.
As UK plc seeks to balance its social,
economic and political interests, it
doesn’t need additional challenges, or
additional problems. What it needs,
is to focus on growth and evolving
economically so every business
delivers a world-beating performance.
There’ll always be volatility in energy
costs, driven by oil price rises, falling
exchange rates, pipeline failures,
explosions and hurricanes to name
but a few factors. Businesses must be
organised so that energy prices aren’t a
distraction from the focus on delivering
a world-beating performance.
Let me say this again – Inspired Energy
supports 2,000 businesses in managing
the shocks from soaring energy prices.
Of these customers, 30 per cent –
that’s 600 – manage their energy costs
in a way we consider best practice. We
continue to work with our clients, old
and new, to make the transition to a
world-beating platform, but we need
to make that transition faster.
It is your responsibility to take control
through prudent risk management,
applying the same risk protocols to
energy costs as you do to those parts
of your business that are deemed
mission-critical.
What is meant by world-
beating?
Success means organising yourself so
that energy costs are largely irrelevant
in the grand scheme of things.
Whatever happens to energy prices,
don’t be distracted, because there’s a
structured approach you can adopt.
In order to
offset the
increase in
energy costs, a
business needs
to grow
revenues
organically by
25 per cent just
to stand still
Value proposition
THE PARLIAMENTARY REVIEW
Highlighting best practice
36 | INSPIRED ENERGY
Managing your accrual: There’s
evidence that one in three energy
invoices in the UK is incorrect. Over
the last 18 months, we have delivered
over £100 million worth of historical
revenue recovery to clients. We
know that many businesses accrue
errors in their energy invoices or for
consumptions yet to be invoiced.
Analysing this accrual effectively
and securing revenue recovery
is the catalyst for world-beating
performance. Let us analyse and
quantify this accrual for you. By
analysing and quantifying this accrual
you can utilise the money we help you
recover to provide the seed capital to
improve your business.
Embrace flexibility: When energy
prices are at a cyclical high, it doesn’t
make sense to lock in costs for long
periods. Equally, it doesn’t mean that
high prices can’t rise further. Some
of the money saved from releasing
your accrual can be used to manage
your energy cost and usage through
flexible procurement. Your business
can procure energy at the daily market
index price and systematically buy
tranches of energy to increase the
proportion of your portfolio with fixed
prices. The effect will be dramatic,
protecting you against rising prices
and lessening the proportion of your
portfolio exposed to fix when market
prices fall. This risk-managed approach
allows energy price volatility to be
managed, thereby avoiding EBITDA
shocks from rising prices.
Optimise consumption: Energy
transmission and distribution costs
have been increasing for a decade.
Once you’ve protected yourself from
price volatility, you can focus on using
some of your recently reduced accrual
to invest in optimising your energy
consumption. This can be achieved by:
focusing consumption of energy on the
cheapest times of the day, improving
energy efficiency, installing control
systems and adding on-site generation.
As you invest your accrual in these
optimisation methods, you’ll reduce
energy consumption and costs and
create a virtual cycle of investment.
Your cost savings will offset the risk
of further energy price increases and
reduce their impact.
How do we become world-
beating?
Staying focused on delivering world-
beating performance and not becoming
distracted by cost shocks caused by price
rises requires you to do the following:
»Accept that unexpected energy price
rises pose a serious threat to the
health of your business
»Release the latent value of your
accrual
»Protect yourself against energy price
volatility
»Optimise your energy consumption
If you can achieve all this you’ll
create an environment where the
consequences of EBITDA shocks to
your business will be minimal, allowing
you to focus on running your business
and driving you towards delivering
world-beating performance. Your
energy is our priority.
Over the last
18months, we
have delivered
over £100
million worth
ofhistorical
revenue
recovery to
clients

www.inspiredenergy.co.uk

This article was sponsored by Inspired Energy Plc. The Parliamentary Review is wholly funded by the representatives who write for it. The publication in which this article originally appeared contained the following foreword from The Rt Hon Theresa May MP.

The Rt Hon Theresa May MP's Foreword For The Parliamentary Review

By The Rt Hon Theresa May MP

This foreword from the then Prime Minister appeared in the 2018/19 Parliamentary Review.

British politics provides ample material for analysis in the pages of The Parliamentary Review. For Her Majesty’s Government, our task in the year ahead is clear: to achieve the best Brexit deal for Britain and to carry on our work to build a more prosperous and united country – one that truly works for everyone. 

The right Brexit deal will not be sufficient on its own to secure a more prosperous future for Britain. We also need to ensure that our economy is ready for what tomorrow will bring. Our Modern Industrial Strategy is our plan to do that. It means Government stepping up to secure the foundations of our productivity: providing an education system that delivers the skills our economy needs, improving school standards and transforming technical education; delivering infrastructure for growth; ensuring people have the homes they need in the places they want to live. It is all about taking action for the long-term that will pay dividends in the future.

But it also goes beyond that. Government, the private sector and academia working together as strategic partners achieve far more than we could separately. That is why we have set an ambitious goal of lifting UK public and private research and development investment to 2.4 per cent of GDP by 2027. It is why we are developing four Grand Challenges, the big drivers of social and economic change in the world today: harnessing artificial intelligence and the data revolution; leading in changes to the future of mobility; meeting the challenges of our ageing society; and driving ahead the revolution in clean growth. By focusing our efforts on making the most of these areas of enormous potential, we can develop new exports, grow new industries and create more good jobs in every part of our country.

Years of hard work and sacrifice from the British people have got our deficit down by over three quarters. We are building on this success by taking a balanced approach to public spending. We are continuing to deal with our debts, so that our economy can remain strong and we can protect people’s jobs, and at the same time we are investing in vital public services, like our NHS. We have set out plans to increase NHS funding annually by an average by 3.4 percent in real terms: that is £394 million a week more. In return, the NHS will produce a ten-year plan, led by doctors and nurses, to eliminate waste and improve patient care.

I believe that Britain can look to the future with confidence. We are leaving the EU and setting a new course for prosperity as a global trading nation. We have a Modern Industrial Strategy that is strengthening the foundations of our economy and helping us to seize the opportunities of the future. We are investing in the public services we all rely on and helping them to grow and improve. Building on our country’s great strengths – our world-class universities and researchers, our excellent services sector, our cutting edge manufacturers, our vibrant creative industries, our dedicated public servants – we can look towards a new decade that is ripe with possibility. The government I lead is doing all it can to make that brighter future a reality for everyone in our country. 

British politics provides ample material for analysis in the pages of The Parliamentary Review 
The Rt Hon Theresa May MP
Prime Minister