£2.1 billion reasons to make energy work harder for UK industry

For UK manufacturers, the opportunity to cut energy costs starts on the factory floor. Recovering or sharing wasted heat, making equipment more efficient and generating power on site can do more than reduce bills. They can help build a more resilient business and free up money to invest in its future.

When looking to bring down energy costs, the supply contract is only part of the picture. Heat lost during production, equipment using more power than it needs and rooftops that could generate electricity all offer opportunities to rethink how energy works for the business. Making better use of these resources can help to reduce the amount of energy a site needs to buy.

The ReIndustrial Revolution report puts a figure on that opportunity: £2.1 billion in cumulative gas cost savings across UK manufacturing between 2027 and 2035. Independent modelling by Development Economics estimates that adopting proven energy technologies could unlock these savings, with annual gas cost savings reaching £406 million by 2035*.

Realising these savings depends on businesses adopting the technologies at scale. For individual manufacturers, the starting point is understanding which improvements suit their operations and assessing the investment required against the savings they could deliver.

Making every unit of energy work harder

The analysis examines four interventions: energy audits, smart monitoring and management systems, on-site renewable generation and storage, and waste heat recovery. Together, they shift the focus from simply buying energy to getting more value from it.

If manufacturers adopt these technologies at the highest level considered in the report, annual gas use could fall by 15.3 terawatt-hours (TWh) and electricity use by 8.8 TWh by 2035. The message for businesses is simple: the opportunity is not simply to buy energy at a better price. It is to waste less, generate more on site and get greater value from when and how energy is used.

Some of the biggest savings come from making better use of equipment businesses already have. In each of the report’s three scenarios, monitoring and management systems account for around half of potential gas savings, while energy audits contribute around a quarter. This shows the value of understanding energy use and cutting waste before investing in larger infrastructure projects.

There is also value in energy that might otherwise go unused. Recovering surplus heat from industrial processes can put it back to work, reducing the need to buy additional energy. On-site renewable generation and storage can help businesses generate and manage more of their own power, as part of a system designed around their needs.

At Diageo’s packaging facility in Leven, Fife, E.ON installed 7,700 solar panels that generate almost a fifth of the site’s annual electricity needs – reducing reliance on purchased power while cutting carbon emissions.

Businesses can also earn revenue by changing when they use energy. At cold chain provider Reed Boardall’s North Yorkshire site, npower Business Solutions’ Demand Shift service enables brief reductions in electricity use at peak times. Unneeded power is sold back into short-term markets without affecting day-to-day operations – turning flexible energy use into a commercial asset.

These are different routes to the same goal: making energy work harder for the business, rather than treating it as a bill beyond its control.

Building confidence in the business case

The appetite to invest is already there. Polling of 502 UK business leaders found that 89% say they are likely to invest in energy efficiency or low-carbon technologies over the next two years. Yet 48% identify upfront costs as the biggest barrier, while 37% cite uncertainty over returns on investment.

Cost savings are the single biggest factor influencing investment decisions for 44% of business leaders. Showing how cleaner technologies can reduce running costs is therefore central to building the confidence to invest.

The appetite is there. The challenge is turning it into commercially sound investment, with a clear view of costs, savings and operational needs.

Turning clean energy into a competitive edge

For UK industry, the value of cleaner, smarter energy goes beyond a single bill. Reducing waste, improving control and making better use of on-site resources can support a more resilient operation, while helping businesses cut emissions.

That is the thinking behind the ReIndustrial Revolution: turning clean energy into a competitive edge for UK businesses. Through innovation that makes energy an asset, we’re helping our customers cut costs, decarbonise their operations and become more resilient.

The £2.1 billion opportunity is not just a reason to look again at how industry uses energy and how much it pays for it. It is a reason to rethink energy’s role in the business as a source of lower costs, greater control and stronger competitiveness.