Weather warning

Snow storm slams UK

This winter’s extreme weather in the UK suggests businesses need to be better prepared

The so-called "beast from the east" weather front that struck the UK in March may have meant fun for thousands of children because of school closures and the unexpected chance to frolic in the snow, but it had much more serious consequences for businesses.

Most obviously, the extreme conditions left many UK roads blocked with snow and created hazardous driving conditions across much of the country. Rail and air transport was also badly hit, causing further problems for people trying to get to work and for businesses striving to provide goods and services.

 

Lack of energy

One sign of the weather’s adverse business impact came from National Grid, which issued its first warning in eight years. The warned that they were struggling to source enough gas for its power stations in the face of increased demand for energy from households and businesses, and losses of gas supply from pipelines in northern Europe.

National Grid requested heavy industrial users of energy to cut their consumption and threatened to reduce supplies to them. Such users also suffered higher costs, with a 74% increase in gas prices on one day. Industry lobbyist, the Energy Intensive Users Group, says such businesses typically buy some of their gas at short-term prices in the wholesale market, so the surge in gas prices hit them hard.

 

Focus on the future

Experts point to the prospect of similar – or worse – energy squeezes in future. One reason is that the industry no longer has access to the North Sea’s Rough gas storage facility that was closed by Centrica in 2017 for safety reasons. Another is a steady decline in supplies from North Sea fields, making the UK more reliant on gas imports. At the same time, demand is increasing as gas-fired power stations continue to replace those fuelled by coal.

The threat of reduced energy supplies leading to business interruptions, together with potentially crippling energy costs, suggests that businesses should give proper consideration to energy efficiency and usage as part of their business continuity plans.

The BCI Horizon Scan Report 2018, recently released in association with BSI, reinforces this point. It places ‘interruption to utility supply’ and ‘adverse weather’ among the top five threats to business continuity, based on feedback from risk professionals in over 650 organizations. And such fears are supported by actual business disruptions in the past 12 months, with half of businesses surveyed affected by adverse weather, and 43% by a utility failure.

 

Positive thinking

On a positive note, the report’s author, Gianluca Riglietti, BCI Research & Insight Manager, observes, “Organizations seem to be headed in the right direction in terms of preparedness, as the uptake of the business continuity standard ISO 22301 shows consistent growth.”

The international standard for energy management ISO 50001 also has a key role to play, as Stoke-based FUCHS Lubricants (UK) plc – part of the world’s leading independent supplier of lubricants – has discovered. Through its certification by BSI to ISO 50001 in 2015, the company has cut its energy usage by 1-2% in each of the last two years, making hundreds of thousands of pounds of cost savings. “The savings are transparent, and almost instant,” says Simeon Preston, FUCHS’s Compliance Manager.

He adds, “The key advantages of ISO 50001 are that it focuses senior management and drives continual performance improvement. There are variables, such as the price of fuel, but we see the savings continuing year on year.”

 

For more information on ISO 22301 or ISO 50001, call +44 345 080 9000 or email cservices@bsigroup.com.