Helping Councils save energy and costs

With the public sector always looking at ways to save money due to cut backs, energy remains one of the most major expenses for local authorities. In this article we demonstrate how reductions in utility costs and energy consumption can be made, and how STC have helped one particular council save over £8.6m since 2013.

Many local authorities find themselves with incomplete site lists, estimated utility bills and default unit rates. This often leads to overpayments being made and utility invoices not being investigated fully. This is when issues tend to crop up.

Councils can also lack in-house expertise to implement energy-efficient measures such as on-site smart meters or consumption reports. The solution to this issue is to have a consolidated portfolio and a customised utility bureau service.

Cleansed Portfolio

The first stage is to establish exactly what supply points are in your organisation (including water) and create a cleansed database of all utilities. This in itself can highlight opportunities for savings, such as identifying non-consolidated supplies billed on “default” or out of contract rates.

Invoice Validation - Only paying for what you use

Suppliers’ contracts and invoices can be very complex and difficult to understand. As a result it is inevitable that some billing errors will be missed. With flexible and energy only contracts becoming a more popular way of buying energy, additional validation is required to balance reconciliation statements from suppliers and check the growing number of third party charges.
STC have been processing utility invoices for over 25 years and estimate that between 3% and 5% of utility expenditure can be saved by fully validating supplier invoices. Our validation process is defined by strict quality controlled procedures to ensure that all billing errors are identified and corrected.

Accounts Payable - Faster solutions, accurate results

Changing to electronic billing and using a system that can import and validate these invoice files is a much more efficient way of processing utility invoices. Once validated, invoices can be included on a consolidated accounts payable file that can be imported to most accounting software. This ensures that duplicate or incorrect payments are eliminated.

Council Case Study – our service, your solution

In July 2013, STC were commissioned to provide an energy bureau service for a large city council. The council’s objective was to develop a sophisticated energy management programme that would support them in reducing energy costs and managing bills.

Similar to many other local authorities, this particular council did not have a complete list of their properties. As part of the setup process, STC collated and cleansed the data from the previous provider, the council and the utility supplier. STC obtained historic data and created a database of meters and accounts. This enabled the council to control their energy spend and only pay for the sites that were within their portfolio.

The council had supplies on different contracts with multiple suppliers. STC’s bureau service identified these supplies and consolidated them onto the government procurement framework. STC also identified sites that were on default rates and added these to the group contract. This helped the council make savings on default rates and improved administration efficiency.

STC has identified and recovered over £8.6m worth of savings since July 2013 by:

  • Creating an up-to-date site list and consolidated all supplies under the government procurement framework
  • Identifying sites that were either on default or incorrect rates
  • Resolving queries for duplicate invoicing
  • Identifying the schools that were on the wrong VAT rate and correcting with the suppliers
  • Obtaining CCL exemptions for qualifying schools
  • Correcting billing for sites that were no longer under the council’s responsibility
  • Identifying sites that would benefit from a reduced supply capacity and managing that process for the council

Ongoing Service Provided

STC continues to provide the council with a full energy bureau solution, which includes a thorough bill validation service, using our advanced energy management software. An STC Account Manager carefully reviews each invoice, and raises queries with the supplier. All queries are managed by STC from start to completion. The council has access to STC’s unique online energy portal, which provides a wide range of energy management and financial reports, including copies of utility invoices and billing queries. This information assists the council in strategic planning to reduce energy consumption and save costs.

Want to know more about STC Energy’s bureau service and how we can help the public sector save costs? Simply call, email us or visit our website.

STC Energy part of the Inspired Energy Group.

Tel: 
020 84662900