How can schools and trusts manage the rising price of energy
Read time: 5 mins Added 23/05/2022
Running a school or trust while working with tight budgets and limited opportunities to increase income, presents a huge challenge when we are faced with sharp rises in energy costs and the imperative to reduce carbon emissions. We’ve asked education property consultants, Barker Associates to explain some key areas where schools and trusts can manage the rising price of energy, while utilising the opportunity to become more sustainable.
What is happening with energy prices?
Everyone wants to take action on climate change but the recent and unprecedented rises in electricity and gas prices have added further urgency to this issue. Inflationary pressures as the world emerges from the Covid-19 pandemic coupled with the war in Ukraine have combined to drive energy prices way beyond predicted levels.
Although most expect a market correction following these sharp rises, it seems unlikely that prices will drop to historic levels and may take some time to fall.
Where do schools fit in?
According to the Department for Education (DfE), schools and universities represent 36% of total UK public sector building emissions.1
In a recent study, Barker calculated that 120 of the largest trusts consume over 1.3 billion kWh of energy (900 Million Gas, 400 Million Electricity). For this group, a 1p increase in the price of gas will cost £9 million or the equivalent of 274 newly qualified teachers (NQTs). For electricity it is £4.1 million and 124 NQTs.2
The good news is that schools present a unique opportunity for rapid decarbonisation. Over half the energy used in a typical school is when there are no students present, this is because there are often limited behavioural changes when people leave the building. For example, lights and monitors are often left on overnight. By implementing small behavioural changes, like adjusting timings on heating and water, schools are in an ideal position to galvanise wider efforts to become more sustainable.
It is worth noting that the twin objectives of saving money and reducing carbon emissions can often complement each other. Although some work programmes will inevitably require capital investment, there are several ways in which schools and trusts can start their decarbonisation journey at the same time as saving money.
So what can be done?
There are three main areas where schools and trusts can implement change:
1. Energy procurement
You can buy your energy in an efficient and sustainable manner across your organisation. Understanding your contracts and consumption can be a relatively quick win in saving money. Using a specialist broker who understands the market and gets to know your organisation can help in finding the best tariffs and contracts.
- Understand your contracts and align your procurement process across a trust to minimise the administrative burden and maximise buying power.
- Understand your consumption patterns and align with available supply capacity. A bit like minutes on a mobile phone contract. Buy too much and you are overpaying, too little and you will run short or pay a penalty. This is where Smart metering and data management can help.
- Look at moving to green energy tariffs as an easy first step to lower your carbon footprint.
- Work with a specialist broker with a transparent fee structure who will explain the risks and benefits of different contracts and suppliers and help you get the best deal.
2. Reduce energy consumption
50–60% of energy in a typical school is used when there are no students in the building. Reducing the amount of energy consumed will save costs and reduce carbon emissions. For most schools and trusts the areas of most benefit come from the following:
- Switching to LED lighting
- Insulation of building fabric and heating pipework
- Correctly operating Building Management Systems
- Installation of heating controls
- Smart switching of heating and electrical systems
- Behavioural change for building users
Many of these can be done at low cost or with zero capital and offer significant returns on investment. It is important to do your due diligence and seek professional advice.
3. Generate renewable energy
The more energy you can generate, the less reliant on shifting energy prices you will be. A school can typically generate 25% of its electricity on site from Solar Photovoltaic (PV) panels.3 Funding solutions are available to enable schools and trusts to do this even if they do not have available capital. Things to consider when considering a Solar PV installation:
- Size of the system: This should be sized to suit your electricity consumption, not the size of your roof.
- Permissions: You may need planning permission and/or a licence to alter before installing a PV array.
- Building condition: It is important to consider the building you are proposing to install your Solar panels on. A Solar PV system has an expected life of 25 years so is the roof going to last as long or is maintenance required?
- Warranties: Look for warranties that run for the same time or longer than any associated finance solutions. If you are installing panels on a roof with a warranty, ensure that this is not invalidated when the panels are installed.
- Maintenance: Make allowances for ongoing maintenance of the system when building your business case. Panels will require electrical safety checks, physical checks of mounting systems and regular cleaning to ensure efficient and safe operation. Invertors will typically need to be replaced half way through a 25 year lifecycle.
Barker Associates is a leading education property consultancy working with Lloyds Bank to support the sector in promoting best practice and enabling the journey to net zero. The Barker Energy 360 process helps organisations understand their estates, develop a strategy, assess funding opportunities and implement programmes of work to save money and reduce carbon emissions.
Robert Gould, Barker Associates