Research reveals energy impact on business

THE SURVEY spoke to 2,300 leaders from small and large businesses across a range of sectors, with respondents saying energy costs and insecurity are having a significant impact on the workforce with decreased investment in employees. Business leaders are also concerned about potential impacts of meeting their sustainability targets.

The key impacts on businesses due to rising energy costs in the last year include lower profit margins (34%) and cuts to spending in some areas (34%), leading to a shift away from investment in R&D and other business growth initiatives. Over a third (38%) have or plan to reduce technology investment, while a third (33%) expect to cut spending on infrastructure and 31% foresee a decline in marketing spend. 

Respondents further cite concerns that energy pricing and insecurity could delay progress on climate change, with meeting carbon reduction commitments currently considered less of a priority than reducing energy costs. Over half (58%) of business leaders surveyed said the cost of energy could delay achieving their sustainability and carbon reduction targets by anywhere from one to five years. 

In response, 34% have already increased investment specifically focusing on improving their energy efficiency and 40% are looking to install on-site renewable energy generation to become less dependent on the grid.

ABB Electrification president Morten Wierod, says: “Businesses say they need to insulate themselves from energy prices and insecurity and are re-evaluating current and future spending plans. Taking action to mitigate this is a clear priority, but this doesn’t have to be a catalyst for potential workforce or environmental impacts. Investing in smart and sustainable on-site renewables and energy efficiency technology means businesses can simultaneously cut costs and reduce their emissions.” 

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