NRA urges SMEs to save on energy costs

The National Retail Association is urging small and medium businesses to take advantage of the Federal Government’s $62 million grant program to lower the cost of their energy bills.

The Government announced this week that grants of between $10,000 and $25,000 will be available to SMEs to fund energy-saving measures such as high-efficiency air-conditioners or installing tools to monitor energy use.

NRA CEO Greg Griffith welcomed the initiative.

“Energy is one of the biggest overheads for many businesses, particularly retailers who deal with food and drinks that require large refrigeration cabinets,” Griffith said.

“All retailers know the costs of running that equipment has increased significantly in recent years, and these are costs that need to be passed on to consumers. It’s pleasing to see the Federal Government recognise that increased cost burden, particularly at a time when consumers are becoming increasingly cautious and price sensitive."

From July 1, 2022, the Australian Energy Regulator's (AER) 2022–23 Default Market Offer (DMO) prices, which is the safety net cap on energy prices, increased by between 0.2% and 13.5% above inflation for small businesses. AER said this is largely due to significant rises in wholesale electricity costs over the past year.

Since DMO 2021, wholesale costs for retailers have risen by 41.4% in New South Wales, by 49.5% in Queensland, and by 11.8% in South Australia, due to reductions in thermal generation resulting from unplanned outages and higher coal and gas prices, slowing of investment in new capacity, and increasingly ‘peaky’ demand (sharp highs and lows) driving up the cost of wholesale electricity contracts for retailers.

“We know that retailers are already looking closely at their energy use and looking for ways to lower their costs," Griffith continued. "This is a very good opportunity, and we encourage all eligible businesses to apply.”

The NRA has this week confirmed its commitment to helping the retail sector progress in ESG, by appointing Dr Geoffrey Annison as its ESG Policy Consultant.

Dr Annison has held a number of senior roles in the food and grocery sector, most recently with the Australian Food and Grocery Council.

Griffith said Dr Annison would be a voice for industry to help government understand the commercial realities of working towards environmental best practice, and would be available to help NRA members on this journey.

“This grant program from the Federal Government is a strong start, but there are a lot of other ways retail businesses can ensure they are at the forefront of ESG," Griffith said. "The NRA is here to help, and we have people with the expertise to put businesses on the right track.”