Hidden fees cost UK businesses £2.6 billion annually for renewable energy
Despite the new Labour government's commitment to a greener UK energy system, recent data has uncovered that hidden transaction fees are inflating costs for businesses transitioning to renewable energy. A comprehensive analysis has shown that these hidden fees are costing UK businesses a staggering £2.6 billion annually, translating to an additional monthly expense of £216 million.
This revelation comes from tem., a platform dedicated to revolutionising how UK businesses access renewable energy. Founded by a team of seasoned energy sector leaders and entrepreneurs with over 30 years of experience, tem. is advocating for greater transparency and fairness in the industry.
According to tem.'s findings, UK businesses are paying, on average, 25% more than the price offered by renewable energy generators. This price hike is attributed to inefficiencies and a lack of transparency in the traditional wholesale energy market, which was originally designed for the trading of oil and gas from centralised sources. Even with the rise of decentralised renewable energy over the past few decades, the market structure has remained largely unchanged. Consequently, multiple intermediaries now stand between businesses and renewable energy providers, driving up costs by a significant 25%.
Additionally, these expenses are compounded by Third Party Intermediary (TPI) fees, which suppliers are now required to disclose, further burdening businesses striving for a sustainable future.
Joe McDonald, CEO and Co-Founder of tem., said: “This is a historic moment for the UK’s energy market. The new Labour government is hoping to jumpstart the UK’s clean energy sector, and investors are backing a cleaner future for Britain. Yet, our analysis shows that even with this positive government support, there remains a large elephant in the room that needs to be addressed – in the form of big energy.
“These organisations continue to profiteer off an outdated energy market designed to sell oil and gas, all at the expense of British businesses’ bottom line. The first step in truly offering the benefit of renewable energy sovereignty and low carbon electrons in the UK is reducing the transaction fees and premiums that are charged through outdated markets and players.
“Only then can we create the opportunity to decouple low carbon electrons from fossil fuel electrons that have the potential to reduce energy costs for businesses by 95% – ushering in the same prolific paradigm shift that we saw with microchips from the '70s to today.”
