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Impact of Rising Energy Costs on Education

Back in September 2021, queues for the petrol stations were a shocking yet all too familiar scene across the country. Petrol station stock was depleting and drivers faced a worrisome few days as they anticipated the return of fuel. The shortage came about after a lack of HGV drivers impacted the scheduled delivery of petrol. But this wasn’t the only fluctuation in the oil and gas supply chain. Gas prices rose by 250% in the first half of the year according to the industry group Oil and Gas UK. This change came about because of the high demand for liquefied natural gas from Asia, while a cold winter decreased stock and lowered gas reserves. This combined meant that the oil and gas market was in flux.

Wholesale energy prices continued to increase rapidly throughout the second half of 2021 and much of 2022. Although both gas and electricity prices fell in 2023, the price of gas in October 2023 was around 60% higher than two years previously and the price of electricity was 40% higher. This has left many worried about what 2024 will bring.

This shift in energy prices will impact organisations across countless industries – and schools and trusts will be no different. So how can this be managed? The most crucial reaction is anticipation and preparation. At Barker, we have been anticipating the fluctuation in energy prices over the next 25 years. We believe there is an opportunity and an obligation for those managing education estates to implement strategies to save money and reduce their organisation’s exposure to the future energy market.

The sharp rise in energy costs is putting a huge strain on school budgets and has the potential to directly impact the education of children and young people. Barker conducted some research for The Trust Network on the financial impact of rising energy costs.

  • The sample group of 120 of the UK’s largest Trusts (representing 2,037 schools) collectively consume around 1.3 billion kWh of energy annually (900 million gas and 400 million electricity).
  • For this group, a 1 pence increase in the cost of electricity would add £4.1 million to energy bills which equates to 124 newly qualified teachers. 
  • For this group, a 1 pence increase in the cost of gas would add £9 million to energy bills which equates to 274 newly qualified teachers. 
  • For a typical secondary school using 600,000 kWh of electricity and 800,000 kWh of gas, every 1 pence increase on each utility would cost £14,000 per year, almost half an NQT.


What Action Can Schools Take to Mitigate the Impact of Energy Price Rises?

The energy audits we undertake at Barker can provide an in-depth understanding of your estate’s energy usage. We can identify key opportunities for improvements and create a tailored energy strategy to help make the rising cost of energy more bearable. Using the Barker Energy 360 process, you can reap the benefits of a well-planned energy transformation.

Energy Bills Discount Scheme (EBDS)

“Rising energy costs will affect all of us – and will have a significant impact on public sector budgets, including schools and trusts”

There are 3 main areas where schools and trusts can implement change that will not only impact carbon emissions, but finances too:

  • Maximise Buying Power

You can maximise your buying power by undertaking energy audits in order to implement a procurement strategy. Working with an energy strategist will help you to effectively identify areas within a building that can be improved. This will allow you to monitor and stay on top of sudden changes in the energy market. You can ensure you’re buying your energy in an efficient and sustainable manner across your organisation, reducing your gas and electricity bills as well as improving your carbon footprint in the long term. 

  • Reduce Energy Consumption

It will be necessary for schools and trusts to reduce their energy consumption to reduce their energy costs. This can be achieved through energy management systems and by introducing energy efficiency measures and lower-energy technologies, such as replacing existing lighting with LED lamps. As well as simple actions such as turning off heating and lighting when buildings are not in use. Reducing the amount of energy consumed will save costs and also reduce carbon emissions. 

  • Generate Renewable Energy

The more energy a trust can generate onsite, the less reliant on shifting energy prices they will be. Barker can work to install renewable technologies onsite to create an environment that is self-sufficient and financially beneficial. A school can typically generate 25% of its electricity on-site from solar PV systems, for instance, and solar energy for schools is a popular renewable energy source. With our help, our clients have saved over £2m over 25 years after sustainable energy methods have been installed. Installation costs pay for themselves over time and investing in solar panel systems is a cost-effective option to consider. 

Watch our webinar on Solar PV and LED lighting

Watch our webinar on Energy Strategy for Schools and Trusts

Find out what Barker can do to ensure the rising price of energy doesn’t negatively impact your organisation. Our energy strategists can help you to make the right decisions for your estates, whether it’s focusing on energy efficiency measures or installing solar panels. Contact us today.

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