Electricity chief culprit as energy prices soar once more

Electricity was the chief culprit, with 51% of site managers reporting the utility had contributed the biggest increase to their 2012 bills. Ongoing price hikes follow two successive years of soaring bills, revealed by WM's last three annual Energy Reports. Strained sites called on the government to exempt manufacturers from the Carbon Floor Pricing (CFP) scheme, which is tipped to drive costs even higher when it launches in April this year. Half of the 100 respondents said CFP, which will charge a minimum price on all carbon emissions, would swell energy bills even higher in 2013. Nearly 80% pledged support for a campaign to exempt manufacturers from the scheme. One respondent commented: "The rules about carbon leakage fail to understand how easy it is for big multinationals to move production from the UK. There should be more specific exemptions for UK companies." Another added: "Energy costs are already high: schemes like CFP just add to expenses." One in 10 manufacturers warned CFP-instigated price rises had the potential to put them out of business. Capricious energy prices mean manufacturers are increasingly looking to fix energy bills, the report also revealed. Nearly 60% pay utilities on a fixed-price basis, with one-year deals the most popular. Businesses are also redoubling efforts to boost energy efficiency in the face of rising prices, the report showed. A quarter of sites now generate energy on site and 56% have a dedicated energy champion to rally employees towards greater savings. Over 40% of manufacturers want to cut energy use by 5% or more on current consumption levels. Raising investment capital for more energy-efficient equipment was named as the biggest threat to success, with many calling for more government aid to help them. A respondent commented: "The one thing government could do is offer tax incentives for businesses investing in low energy lighting and self generation."