How do medium-sized businesses cope with energy costs?
09/28/2023
Source: Energy & Management Powernews
The energy cost share in medium-sized companies is lower now than in 2021, according to a study. But small businesses fear further challenges.
German businesses are saving energy vigorously. As a survey of the KfW SME Panel shows, almost three-quarters of all small and medium-sized enterprises (SMEs) have reduced their energy consumption through "energy-conscious behavior". According to the survey, energy costs in SMEs are now lower than before the outbreak of war in February 2022.
Accordingly, in 2021, energy costs accounted for no more than 2 percent of total sales in only about one-third of the SMEs surveyed, but by April 2023, this figure had risen to 42 percent. Extrapolated, this corresponds to around 1.6 million companies.
For 31 percent of SMEs, the KfW market researchers show an energy cost share of between 2 and 5 percent. The number of businesses where energy costs gobble up more than 10 percent of sales has fallen from 16 percent to 7 percent, they say.
Further efforts to save energy appear to have narrow limits in many places: 41 percent of the companies surveyed in April said they had exhausted all savings measures known to them at the time or available to them with their current financial and technical capabilities. 28 percent said they had implemented some measures, and others were planned. For 4 percent, precautions so far exist only on paper.
A good one in four respondents is doing nothing
A whole 27 percent have not implemented any savings measures and have none in the pipeline. Small businesses in particular point out that further cost-cutting measures will pose "challenges" for them.
The experts at KfW Research conclude that SMEs are "coping well so far" with energy price fluctuations. "The current situation of small and medium-sized enterprises with regard to the energy cost burden is largely relaxed - also because companies have done their homework and, for example, reduced their costs through energy-conscious behavior," explains KfW Chief Economist Fritzi Köhler-Geib.
Among the measures taken by the business community, first and foremost is the reduction of consumption through "energy-conscious behavior." In second place is investment in electromobility. This is followed by the conclusion of long-term supply contracts for electricity from renewable sources (green corporate PPAs).
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