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Hosted by Ben Thompson, the Oxford Business Podcast is a monthly podcast featuring conversations with experts in a range of fields including marketing, finance and sales.
[00:00:00] Ben Thompson: Welcome to the Oxford Business Podcast of the Oxford Business Community Network. Thank you so much to Story Ninety-Four for welcoming us to their wonderful podcast studio in Oxfordshire. If you haven't been, I definitely recommend checking it out. Today I'm really delighted to Jamie Knight of Fidelity Energy. Welcome Jamie.
[00:00:24] Jamie Knight: Thank you very much. Thanks for having me, Ben.
[00:00:25] Ben Thompson: So thanks so much for joining us. So let's just start by who are Fidelity Energy?
[00:00:30] Jamie Knight: So we're an energy broker based down in Newbury. We work with 27 energy suppliers working with various sized companies all the way down from sort of small corner shops up to big national retailers and stadiums, and yeah, essentially, we're a brokering service primarily, but then we help with all things energy essentially, and just trying to get our name out there at the moment and help as many businesses as possible.
[00:00:54] Ben Thompson: Amazing. It's been widely reported, mainly on the residential side, what's happening in the energy sector. So I think a great thing to share to start with those listening at home, is what is happening in the commercial energy sector?
[00:01:07] Jamie Knight: So the commercial energy sector is very different to the domestic sector. It's very reactive on a daily basis actually, it's quite flat at the moment. We saw a dip down in June as we've seen sort of the rest of the year, but it bottomed out in June and the market at the moment is slowly creeping up nothing massive or to be greatly concerned about. But as we head into the winter, we believe that's going to get progressively worse as we start to run out of storage on the national grid and LNG supply into the UK, really, so it's really just being aware of your position in the market where your business sits and make sure you have a plan essentially, which is really important at the moment.
[00:01:47] Ben Thompson: Absolutely, and are you finding that businesses are quite on top of their energy? Or do you find that often there's lack of awareness or it's a bill that is going up that's kind of forgotten I guess?
[00:01:59] Jamie Knight: It's a mixture to be honest. So you've got some companies are really on it. They're very much at the forefront and they're keeping their finger on the pulse and you've got other companies who tend to sort of bury their head in the sand and almost sort of wishing it'll go away. It's not going to go away, this is the reality, certainly for the next few years. So it's, again, being aware of what your position is in the market, how long you got left on your contract and trying to have a plan essentially regarding that.
[00:02:25] Ben Thompson: Of course, and just in terms of the energy sector, why did prices so suddenly shoot up?
[00:02:32] Jamie Knight: So there's a couple of things really, one, obviously the main elephant in the room is Russia's invasion of the Ukraine so that caused a massive disruption to the market. Obviously they were supplying a lot of gas into Europe, so that's dropped off quite significantly at the moment, and then there's been other factors regarding that over the course of the last 12 months. It's kind of the perfect storm you will. We've had the least windiest years on record in terms of wind production in the UK. So that's not helped. Again, mentioned the LNG storage coming into the UK at the moment, which is a massive concern, and then there's been other factors, so last year we had a there was a big fire in a LNG plant in Texas, which again, no one planned for. So they were supplying a lot of LNG into Europe as well. That went offline for about three, four months. So there's all these perfect storm that's come about regarding that. There's a few other factors, but they're the sort of the main ones that have driven up the market, all these companies that were relying on Russia, essentially for their supplies have now had to find alternatives and we're all bidding for the same piece of the pie as it were.
[00:03:37] Ben Thompson: Of course, of course. One of the things throughout the episodes of this podcast that that we've really realized is that we shouldn't presume that everybody knows what we know. So one of the things, one of the questions that seems like a silly question, but I am going to ask you, what is an energy broker and what is the process of what you do?
[00:03:55] Jamie Knight: So what we do essentially in terms of gas electric, we will get the bills from a company and we'll analyze it for them. So what we'll do is we'll get the bills. We'll look at what they're paying at the moment, how long they've got left on their contract, and then we'll see if switching them to a different provider at the correct point in time is the best thing to do and, or advise them when is the best time to do that and giving them the correct advice. We work with 27 suppliers. I don't know if you've ever tried to ring your supplier at the moment, they're absolute nightmare.
[00:04:27] Ben Thompson: A good long wait.
[00:04:29] Jamie Knight: Whereas we have connections into all these companies. So yeah, if you've got a problem or you need information, we've got ins into those companies that are really quick and we can gather that information very fast.
So obviously we manage a lot of spend. So we've just passed a 500 million pounds worth of energy that's undunder management with us. Soat allows us to buy a better rate than you can as a company as well got that behind us. So, and a lot of big companies trust us with all their energy needs, which is really nice and we're trying to build upon that at the moment, yeah.
[00:05:00] Ben Thompson: Absolutely. Absolutely, and just in terms of, I guess, motivators behind energy, of course, price, I imagine with how energy is growing, it is a massive factor, but are there other factors like is green energy a factor? Like when you're speaking to clients, what tend to be the, I guess, the pain points, but also the motivators?
[00:05:17] Jamie Knight: Pain points at the moment to everyone at the moment is price, purely price. We saw what companies that love to want to look at green, absolutely fine, we can look at those solutions for them. What we're trying to do at the moment is everyone's trying to save money, everyone's trying to protect their business, so we're looking at different ways of doing that. So just recently we've been doing a product called voltage optimization, for example. So essentially what that is we'll look at the building, look at the outlets of what you're getting. So you should be able to get 220 volts as normal. We'll find with most companies, they're probably getting 240, 260.
So we can come in, look at that, put a report together and then essentially put a device on the meter to regulate that extra energy spend. We always say the most expensive kilowatt is the one you're not paying for, and it's amazing. You know, some examples of that so we just done a looks after hotel actually in reading and they we saved them £11,000 on their bill per year and that the return of investment of 3.5 years because of the price of energy at the moment, and, you know, there's a lot of good things regarding that as well, with that voltage over voltage that's going into, you know, your equipment and things that are in the building helps it last longer as well. So it's really good return on investment.
So, and obviously, solar has always been there, but that's an even bigger factor at the moment, and we do all those solutions as well. So it's about thinking outside the box, supporting those companies, giving them other options and again, trying to get them to survive into the future essentially at the moment.
[00:06:49] Ben Thompson: No, absolutely, and just to make sure I understand properly in terms of this overvoltage piece, is that literally that your device needs less volts than is coming out of the plug, which in essence will eventually break your laptop or your fridge or whatever, and you're equally paying more than you need? Is that fair to say?
[00:07:07] Jamie Knight: Yeah, essentially. Obviously, there's a bit more to it than that. But essentially, especially in older buildings, you think of, I don't know if you've stayed in a hotel, for example, and it's been, you know, we live in the UK, there's a lot of old buildings here, they get mains tested and obviously pat tested, which is again, regulatory, that's fine, but it's not going to be dangerous as such. But yeah, it's just going to help the longevity of what's there at the moment. So, you don't need all that extra usage and stuff, especially in a bigger building, like a hotel school, something, you know, like that, even a manufacturer that those things are really important. There's easy money to be saved on those older buildings.
So again, you don't know what your position is until you, you get it looked at. You might be all up to date. It might be absolutely perfect. Fantastic. You've lost nothing. If there is a big deficit there, then there's potential for you to save loads of money and why wouldn't you?
[00:08:00] Ben Thompson: Exactly. One of the other things you touched on is solar, and I think solar's always been a bit of a buzzword, hasn't it? And what are you seeing in the market with solar at the moment? Are businesses getting a good benefit from having solar panels installed? And why should they have a conversation about solar?
[00:08:17] Jamie Knight: So I think that's a really good point actually. It's worth exploring depending upon the size of your business. It's not right for everyone in terms of the size of the business or how much square footage you have. Also, some buildings can't take solar panels, that's what you think, just because you've got a roof you can put solar panels on. It's not always as simple as that adds a lot of extra weight to the structure of the building. Also you've got to think of when that weights up there and when it snows, that adds even more weight. So you've got all these factors to take into place in regarding that. But on the flip side of that, if you've got a bigger building at the moment the old return on investment on solar, for example when energy was back at its norm would probably be 15 years for you to get your money back.
So it was a long term investment. The average return on investment is probably around about three years, four years because the energy has gone up so much. So, and there's different options with solar as well. So you can sell obviously back to. you can get extra storage to keep your own storage of batteries. So there's various different options. So it's definitely worth exploring for a lot of companies, and you've got, again, you've got nothing to lose until you know what your situation is with it.
[00:09:29] Ben Thompson: Absolutely, and what do you see as being the future of the energy market? That's always a rubbish question, isn't it? But if you were to say, do you know what in three years or five years time, I think the sector will be like this. What, yeah, what do you see with the crystal ball?
[00:09:42] Jamie Knight: That's a really good question and really difficult question. I think what I would like to see happen is we need to be more reliant on our own regeneration in the UK, and I think what's happened over the recent years is really given the government something to think about that we were reliant on so many other factors, other countries for our energy, and we need to be able to sort of look at that more sustainably ourselves.
I think what we're seeing at the moment is the norm for the next few years. I think we need to increase storage on the national grid. I think that's very important because we have one of the lowest storage capacities in Europe which is just frightening. So, read an interesting statistic the other day, and it was, if we got no energy, I think we could survive four days as an entire nation. So that's quite a scary thought actually again, hopefully it never come to that. But yeah, it's just all these things we need to think of, I think the thing in the future, and again, this is a quite distant future will be sort of nuclear energy as being a major factor regarding that. And again, I can't remember exactly what it's called. I think it's nuclear fusion or I don't know if you saw in the news, probably about six months ago, they've basically in America, they've made this nuclear fusion reaction device, and it's now giving out more atoms out than they're putting in or more energy out than they're putting in. So that's very early stages.
Again, forgive me, because I don't know the exact wording. So I'm not a nuclear physicist or anything like that. But yeah, there's again, there's interesting things into the future. But they're a way far away at the moment, but I think that as that progresses, that will be very very good to say. Yeah, we'll see
[00:11:25] Ben Thompson: And the other I think hot topic at the moment within the energy sector is electric cars. Businesses are constantly putting charging points outside their buildings, and actually, I think for businesses, it absolutely makes. commercial sense to have an electric fleet, doesn't it? From an energy point of view, what should businesses be considering when moving their fleet to electric and what should they be considering when installing electric charging points in terms of the energy that it's using?
[00:11:52] Jamie Knight: Yeah, so you want someone to come in and do a proper analysis of the building how many charging points you're putting in, what energy that's going to increase by so you can make sure that the contract that you've got in places is obviously adequate for that as well, because it might need to be reassessed due to the increased usage depending on how many you're going to put in.
Yeah, and it's just Looking to the future. I mean, it's really interesting when we're again with electric cars. I've not, again, I'm no electric car expert don't get me wrong, and I'll be probably another, someone else to come in and talk about this. But again, I'm not sure if that's completely sustainable into the future.
There's a lot of hot topics around electric cars, isn't there as I'm sure you're aware how to dispose of lithium and the cobalt mining and stuff like that. So, so yeah, that's a very interesting subject, but I think companies in terms of installing just really need to, yeah, just look at what the, what they use in the increased usage. We've done it our building at work, so we have four solar points, we have four electric vehicles. We saw the usage go up, but you know, we're electric broker obviously, and we want to be seen to be sort of helping the environment and moving in the right direction. So, and I think that's the way everyone's going to be forced to go over the next years and then they're putting all these admissions zones in all over the place. So I'm sure you've seen that in Oxford.
[00:13:08] Ben Thompson: Yeah, no, certainly without turning this into a political podcast, I think if the government decide that we should have electric cars, they'll make us have electric cars, won't they? But but yeah, no, interesting. I just want to go back to this hot topic, which is price, because I think it's really fair to say that as you touched on earlier in this podcast was the pain point is cost and I think particularly when Ukraine and Russia started to happen. We were seeing on the news, businesses were going bankrupt, businesses were closing. So I think let's just start with the glum part in terms of, can you give an insight to those listening of what was happening at that point? Were you regularly seeing businesses go under as a result of this energy?
[00:13:48] Jamie Knight: 100% Oh, 100%. Yeah, we were seeing businesses close on a daily basis. The main sector that we felt were really harsh was the hospitality sector. So for example, hotels, pubs they had quite a raw deal in lockdown. They weren't trading for a lot of the time. Their credit profile dropped.
[00:14:07] Ben Thompson: Of course.
[00:14:07] Jamie Knight: And then when we've come out of lockdown, then we've gone into the energy crisis, they're able to secure decent contracts because their credit's so poor. So that was kind of a, yeah, a bit of a, an unpleasant situation for those guys in terms of looking at that, and again, a lot of customers relying and coming to us and we were putting them with specialist companies to be able to help them regarding that and some people were getting to us too late and yeah, they were just so far sort of in debt that they were unable to switch. So, I mean, luckily the market has dropped down since last year. So I think we were seeing prices of just over a pound a kilowatt at some points with some suppliers. The average price at the moment is somewhere around 30 pence depending upon where you are, but if you're, you signed in before the crisis, you're probably on about 12 to 14 pence. So you're still going to see a double the price on your existing bill, and when you present that to customers, they're kind of, the reality kicks in and they'll then go, Oh, actually, I think I might wait until it comes down. no, it's not gonna come down, this is the norm for the next few years. Certainly, but hey, none of us have a crystal ball, do we? All we can do is take the data that we've got and what all the analysts are saying at all these energy companies and advise accordingly.
[00:15:22] Ben Thompson: No, of course, I don't want to scare people. I don't. But I think something that you know, you and I have had lots of conversations and networking events on some of the people you've helped, and I think it would be good just to be... just to share reality. So if you are a business, Let's give worst case scenario and you bury your head in the sand so don't look at your bill you're unlucky because you're with the worst provider. How much could you be spending on energy? And if you come and speak to an expert like yourself, how cheap could energy be? I'm just,
[00:15:52] Jamie Knight: Oh it's...
[00:15:53] Ben Thompson: Keen for you to share.
[00:15:54] Jamie Knight: It's unbelievable, so I'm helping a company at the moment in London. They're currently paying 70 pence per kilowatt and they're on out of contract rates, and they're still in an hour and what to do and again, all I can do is give them the information. So at the moment, I sent them a proposal the other day and I could save them we'll get them one, I think it was about 28 pence a kilowatt, for example. So cut their bill clean in half still debating what to do. And that to me just makes no sense. If I, yeah, if I come to you as a company and I said, I can cut your bill clean half and save you half of your budget, most people would say yes and this is the bit that we don't sometimes understand with companies and where that thought process is and also some companies, bigger companies have a lot of people that get involved that decision making. So there's a, there's quite a, an arduous process behind that of getting it signed off and again, not to be salesy as at all, but the market changes daily. So when we get prices over to customers, we're saying this is valid until four o'clock today. That's not to come across salesy, that's the reality because tomorrow it changes again and then we have to get it repriced and yeah, it's sort of a bit of a throw of the dice for a lot of companies.
We also think that a lot of companies at the moment. Think that the government are going to come and bail them out again. I think we've got into that mindset maybe from COVID. I know if you agree with that. A lot of companies think, well, the government will step in at some point, we, this won't happen, we can't rely on that. It's not, we're not given that and that money's got to go back at some point. We've got to pay it back. So...
[00:17:32] Ben Thompson: Yeah, I think I'm really pleased you said that actually, Jamie, I think you've really hit the nail on the head. So with speaking to different businesses, I think that within our lifetime, the government have bailed out more than any country in the world, more than any time, and actually we're in more debt than we've ever been before.
So I think to anyone listening at home, whether it be energy or whether it be anything else in business, my advice is don't bury your head in the sand and speak, if it's energy, go and speak to Fidelity, it's really important. I think somebody that isn't necessarily a friend of the commercial energy sector, but I am going to mention...
[00:18:05] Jamie Knight: I know who you're going to mention!
[00:18:07] Ben Thompson: Mr. Martin Lewis, and I think a phrase that I think we can all agree from Martin Lewis is he always says do something and he absolutely is not an expert at all within commercial energy, and I think he would say that on his various channels, but I think something that is a line that he uses, which I think is really key is you must do something and actually you must have that conversation. So just going back just one step a little bit, I just want to put more numbers on it if that's okay. So if somebody's paying 70p and they could pay 28p per kilowatt, how many kilowatts could a business use? So again, let's not just do a maths exercise, but in terms of, you know, if you were to look at a huge building where I know you guys do some great work in football stadiums, and if we're talking about that, like how much could an energy bill be a month? And let's not do the math too much, but how much do big businesses spend on energy?
[00:18:59] Jamie Knight: It really depends, the only one I can think off the top of my head is I was looking after a company a few months ago who are a cold storage unit down in Wales. So if you imagine like it's a giant freezer basically, and they send food out to various companies and various supermarkets. So they're obviously quite a large consumer energy. Just to put this into context, their bill was going from a hundred and, if I'm correct, it's 197,000 and it went up to nearly 500,000...
[00:19:31] Ben Thompson: Wow.
[00:19:31] Jamie Knight: ...per annum. So again, split that into 12 and then you've got the but you know, it's massive numbers for these big companies and the interesting thing with those bigger companies is if the market moves by just 1p or 2p, which doesn't sound a lot to the small companies, but to the big companies, you're already speaking another few thousand pounds. So they need to be more reactive and speak to a broker that they trust and they've got a relationship with. So my advice there would be to any of the companies listening is, you know, speak to a broker, speak to three brokers, we always say. So we tell our customers speak to three brokers. They don't have to use us. We wish they would, but we're so confident in what we do, we say, speak to three brokers, get three different prices from these brokers, and maybe you'll get on well and better relationship with, you know, one than the other, and you know, you can build upon that. So it's about for us as a company, it's about building partnerships. We don't at the people necessarily as customers, we want to build partnerships. We want to help these companies want to maintain regular contact with them and advise them accordingly, which I think is really important going forward.
[00:20:37] Ben Thompson: Certainly Fidelity have got such a great reputation. You know, I know a number of people that you've worked had conversations with, and I think it shows your values by saying, speak to three brokers. I'm going to build on that a little bit more, and let's give advice too, so if somebody's picking up the phone to an energy broker, so let's take Fidelity out of this for moment.
What should be the questions they're asking and what should the broker be doing? What is good service? What should they look out for?
[00:21:01] Jamie Knight: So what they wanna look out for, one of the main things is, you want to know what type of meter you've got, I say in terms of electric. So there's two types of meters, you've got half hourly meter and non half hourly meter, so you understand what that is and what that consists of, so if you've got a non half hourly meter, you can get prices quite quickly.
If it's a half hourly meter, you usually have to go up for what we call bespoke pricing. So you have to What we do is we send out to 27 suppliers, get them all to basically quote it. We tell them a date to come back to us, they'll come back on the same day, we collate all that all to the customer, so that's really important.
I would say what they want to look out for regarding that. is so in that process of us, we ask somebody with a half hourly meter, well, with both meters, but more so with a half hourly meters to sign what we call a letter of authority, which allows us to basically speak on behalf of you as a company. Ours is a low level of authority, it's a level one. So what that means, and it's very clear on our terms and conditions, and it's only one page, so it was not loads of jargon in there. It's very easy, very simple, and it just says, essentially, I authorize Fidelity Energy to speak on behalf of Thompson and Terry to basically go and speak to these companies on my behalf, you've got a level two level authority, which is then what some companies use, which basically reading the small print allows them to sign on your behalf and that's where things get a bit shady. So always read the terms and conditions, ask them. What that consists of. There are also some companies out there that take verbal agreements. So again, be very wary about what you're saying, because you say yes over the phone, they'll record that and they'll take that as gospel and just sign you up, so that's why we say speak to free brokers, make sure they're trusted. You know, speak to your friends you know, your business associates and say, who do you use? What do you do? I think that's really important. There's nothing better than the recommendation is there.
[00:22:59] Ben Thompson: Of course.
[00:22:59] Jamie Knight: So yeah, I think just be really wary about what you're using who you're using and yeah, make sure you're comfortable with them and you're getting the correct information and don't be scared to pick up the phone and ask these questions. I don't know what this means. Well, that's fine, ask us, you're not going to sound stupid, just, you know, ask the questions.
[00:23:17] Ben Thompson: Absolutely. I think that shows the values of you and Fidelity. The other thing that I think you touched on earlier that I think is quite useful is around this cost saving piece. we spoke about the amount of energy that's being used by X appliance. Should businesses be talking to their people now about actually treating the office like home in terms of when you're at home and again, maybe this is just my house. I don't put the lights on upstairs when I'm downstairs, and again, but often in businesses, you do that because it's not your energy. Should there be that ethical conversation in terms of cost saving, but also in terms of using less electricity what be your advice around that?
[00:23:58] Jamie Knight: Definitely. I think there's, it's amazing how many people, yeah, walk out of rooms don't turn off lights, and there's definitely money to be saved there. Think of over the course of per annum. I think the big thing going forward as well as having a smart meter. With our customers, again, with the half hourly meters, we pull off half hourly data, we send to them every month, we send them a free report every single month that's automated and they can. literally break down half hourly on their meter what they're using. So it spikes up over the weekend, you know that someone's left the office lights on, for example, and you can quickly identify that.
So I think people need to be more on top of what they're using, how they're using it, and is there any money to be saved? Have you got an old printer in the corner that's like a dinosaur, you know, could you replace it for a more energy efficient appliance? So there's all these different factors people could possibly look up to, you know, save money into the future, I think.
[00:24:54] Ben Thompson: Absolutely. No really good advice. We are coming to the end of the podcast, but, and I think throughout the last half an hour you've really given some practical advice. So thank you for that. I just want to end with any final tips. So if you were a business owner, or if you were talking to a business owner listening now, I guess what would be your top advice, whether it be things that we've covered already or whor whether it be things that, that we haven't covered, what would be your advice?
[00:25:18] Jamie Knight: So my advice to companies at the moment is really understand where you're on the market, understand your position and don't leave it to the last minute. So we've got companies we work with at the moment that forward procure energy. It's always the best way to do it. We've got companies that come to us for advice who are approached by other brokers, you know, we had one the other day and they were getting advised to sign in for five years. We're like, why would you sign up for five years? That's just ludicrous. So it's about giving the correct advice to people going forward. So yeah, I think understand where you are. It doesn't matter if your bills out in another year, two years, speak to a broker, give them your bills, let them look at it for you and let them monitor the market and advise you accordingly.
There could be 12 months time where the market drops massively. They've got your bills, they ring you and say, there's a massive dip in the market, we suggest you buy now. If you hadn't given that to them, you wouldn't have known.
[00:26:07] Ben Thompson: Absolutely. No really great way to end the podcast. But before we do, like me, I imagine there's a lot of people listening who's thinking, do you know what? I want to have a chat with Jamie. So, if somebody is listening and they want to talk to you or talk to Fidelity, how do they go about that? How can they get in touch with you?
[00:26:21] Jamie Knight: Yeah, so just go on our website is one way you can do it. So it's fidelity-energy.co.uk, you can send me an email if you like, which is jamie.knight@fidelity-energy.co.uk or you can ring me directly, don't worry, there's no 0800 numbers or anything like that, so it's a local number 01635. 918 830 more than happy to have a conversation with anyone and again, even if you've just got a question by all means, just pick up the phone. We're more than happy to help you and advise you accordingly.
[00:26:52] Ben Thompson: Amazing. Thank you so much. We have come to the end of the podcast. You've been listening to the Oxford Business Podcast of the Oxford Business Community Network. Thank you so much as always to Story Ninety-Four for hosting us and producing this podcast at their wonderful podcast studio here in Oxford. I believe still the only in Oxfordshire, so definitely come and have a look, it's a great space. Thank you so much for listening.