Perception is reality. Research suggests that there is a potential gap between business preparedness on energy and perception of those challenges.

New EDF research reveals that complexity in energy pricing is already having wider business consequences. Almost half (48 per cent) say it is making budgeting more difficult, 47 per cent say it has reduced confidence in long-term planning and 43 per cent say it is slowing investment decisions.

The research also reveals that while 86 per cent say they are confident they can manage energy price volatility, nearly three quarters (74 per cent) report that managing their energy supplies and costs has become more complex over the past three years.

Whilst changes in the energy are already making it harder to budget, plan and invest, this suggests that some businesses could still be underestimating the scale and pace of change taking place across the market.

Wholesale price volatility remains the biggest challenge, cited by 49 per cent of respondents, but price is increasingly only one part of the equation. Businesses are also navigating more complex contracts, changing regulation, new technologies and challenges around the quality and visibility of their energy data.

As the UK progresses towards the Government’s Clean Power 2030 ambitions, and the way businesses buy, use and manage energy evolves, these wider factors will become increasingly important. The risk is that some businesses feel more prepared than they really are. The action plan highlights the role of a more flexible electricity system in supporting the transition to clean power. Alongside electrification, this will require businesses to consider how their energy purchasing, consumption and investment decisions fit together. The risk is that some businesses feel more prepared than they really are.

Against this backdrop, EDF’s research highlights an appetite for more choice and support. More than half (57 per cent) want more flexible energy contracts, 53 per cent want greater support managing energy risk and 45 per cent want help with decarbonisation.

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