The rise in the energy price cap announced earlier today will see the average household energy bill rise to £3,500 per annum from October. The predictions for the coming two quarters are much higher.
The Government have announced some measures to help householders cope with the cost of living crisis, but there has been no support announced for businesses, who are facing similar if not larger rises in their bills.
Impact on Isle of Wight businesses
News OnTheWight has spoken over the past two weeks with three different-sized Isle of Wight businesses to get an idea of how they are coping with the ongoing energy crisis that forecasts average annual household bills of more than £6,600 per annum from April 2023.
A Community Interest Company
Ventnor Exchange is a Community Interest Company based in the former Post Office in the heart of Ventnor on the south coast of the Island.
It combines a venue, cocktail and craft beer bar, record shop and (coming soon) co-working office space. As a social enterprise, all of the profits are reinvested to fund projects that develop the cultural offer of the area, and support opportunities for the next generation.
Whitewood: Fringe fuel and power costs up 82 per cent
Co-founder Jack Whitewood told News OnTheWight they are already feeling the pinch. He explained,
“Energy bills have risen dramatically in recent months.
“Fuel and power generation costs at Ventnor Fringe Festival this year were up 82 per cent on 2021, and there is the additional knock-on effect of the rise in haulage and transport costs too, caused by the rising fuel costs.
“Similarly our electricity bills at Ventnor Exchange have more than doubled in the last six months.”
Jack went on to explain,
“We were anticipating increased energy costs, but not at this scale or speed.
“The dramatic and rapid rise in costs across the board is very concerning, especially as all forecasts are for this to continue to rise in the short to medium term.”
Short of reducing opening hours, little room for manoeuvre
Looking at ways that energy consumption can be reduced, Jack told News OnTheWight,
“We are seriously reviewing what we can do to reduce energy consumption at the Fringe in particular, as the current trajectory is not sustainable, but there is limited manoeuvre to cut energy consumption at Ventnor Exchange, short of reducing our opening hours.
“One current priority is to open co-working facilities within our building in the coming months, as a more affordable option for start-ups than renting their own office space, and which will also help towards supporting the work of the Exchange.”
Whitewood: “We’ve heard far too little from Government”
Rightly concerned about the future of their own CIC, Jack also is worried about the future of other Isle of Wight businesses. He said,
“We’ve heard far too little from the Government on how they will support families with rising energy prices, and there has been complete radio silence on the pressures facing small businesses and charities, who do not benefit from any energy price cap at all.
“Many business are indebted from Covid, so unless there is urgent action I would predict there is a real risk or a rise in unemployment in the coming months.”
Impact on Care home
News OnTheWight also spoke with the owner of a residential care home for older people.
They told us that their energy bills, previously £1,700 per month have now risen to £2,300 per month. That’s a whopping £600 per month extra, before the October price cap.
Increase cost to residents
In order to try and cover some of the increased costs the care home owner told News OnTheWight that they’ve no option other than to increase the rate they charge their residents.
“Residents are aware and have been notified of potential increases,” they told us.
Energy-saving measures
Mindful of their residents’ needs, measures to cut back on energy use could include a one-degree temperature reduction in the home, if possible.
They’re also planning on cutting back (potentially stopping) outdoor Christmas festive lighting which uses a fair amount of energy.
They told News OnTheWight,
“At the moment there will be no change to staffing, however, longer term we might have to look at staffing levels, reduced salary increases, if acceptable.”
Care sector in severe crisis: Overlooked by Government
Discussing their views on the lack of support from the Government for businesses, the care home owner told News OnTheWight,
“We are very disappointed that the Government has again overlooked not only small businesses, but also the residential care homes that have done, and continue to do, so much to support those older vulnerable people through their later lives.
“Already underfunded, the care sector is in severe crisis and the Government ignoring to provide support on energy costs in a similar way they have done for the general public will only hasten more closures of care homes and a spiralling deficit of capacity to fulfill the growing demand for care home places.”
AJ Wells: Electricity costs could rise three fold come October
Ced Wells from large Island employer, AJ Wells and Charnwood Stoves, told News OnTheWight,
“Currently we are still in a period where our tariffs are fixed, but it is looking like our electricity costs could rise three fold come October.
“Over the last few years we have invested in more energy efficient machinery and equipment and have streamlined production to increase our efficiency.
“We also currently have around 150-200kW solar PV on our factory roofs but the price rise will still affect our operational costs significantly.”
Share your story
If you run an Isle of Wight business or organisation that will be impacted by the energy and cost of living crises, get in touch to share your story.
Image: National Cancer Institute under CC BY 2.0
