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Energy costs have consistently made the headlines in the UK during the past few years, usually containing the word ‘crisis’ somewhere within them.
The news stories usually tell tales of the woes inflicted by energy price increases that affect all kinds of customers, from households to businesses and entire industries.
For the commercial property sector, which uses roughly 9% of the UK’s power (according to an Investment Property Forum report), there is the added complication of paying those soaring bills when it comes to multi-tenanted properties.
“The landlord essentially becomes responsible for the energy consumed in buildings,” says Sarah Bateman, CEO of Unify Energy, adding, “they contract with the supplier and pay that supplier for everything, and then work out what is used.”
In general, multi-tenanted buildings have one or a handful of gas and electricity suppliers coming in, while tenants are without individual fiscal meters. “There is a mishmash of a mess that sits behind fiscal meters in buildings and that is not the energy supplier’s domain,” says Bateman, “that is completely the problem and the responsibility of the landlord.”
It was this scenario that led to the creation of Unify Energy. Spun out from a utilities department within developer and landlord Bruntwood, that handled and procured its own energy usage across the company’s portfolio, Unify Energy officially launched in 2020. Its mission was to offer energy as a managed service and sub-metering to Bruntwood customers and other building landlords and property agents.
“It came about due to a lack of options and frustration with the quality of management and billing in that space, so Bruntwood registered for an energy supply licence in 2016,” says Bateman.
Four years later, and after becoming Ofgem compliant, Unify was the energy industry’s first, and only fully licenced and regulated energy supply business that has a multi-tenanted product for owners and operators of commercial property.
Reviewing landlords’ energy use
Like Octopus, npower Business Solutions, or British Gas, Unify Energy supplies the landlord at the main fiscal meter. But in addition, it goes behind the meter, says Bateman: “We review what the landlord has got in their building, whether it’s sub-meters, or square footage billing. There could be a scenario they don't like but want to make more optimal – we will help them do that.”
This is an alternative model to the single meter system typical to multi-tenanted buildings where landlords and agents must split energy bills with occupiers based on square footage. As a fully licensed supplier, Unify provides metered energy bills directly to each occupier, giving customers and landlords a more accurate and compliant managed energy service.
Every month tenants are individually invoiced. The landlord is only invoiced for what they are specifically responsible for, such as foyer, corridors and lifts, meaning money is saved in terms of outlay. “It's about a 60% upfront saving and landlords also don't need to employ the people administrating that service,” says Bateman.
Tenants can also ask questions and negotiate rates. “They can get support around ESG, and it has multiple benefits for landlords and tenants. For example, the overall cost for that service is largely the same as the landlord would pay any other generic energy supplier just to dump the energy at the fiscal meter and leave them to deal with everything else themselves,” says Bateman.
Sustainability and data
The commercial property market is venturing ever further into the world of sustainability and trying to hit various built environment targets, from Minimum Energy Efficiency Standards (MEES) to Energy Performance Certificates (EPCs) and beyond. This means added pressure for landlords, says Unify Energy’s Sarah Bateman: “It's a difficult environment for owners and operators of commercial real estate at a time when that space has been hit hardest by other economic conditions.
“Landlords are looking to be more sustainable from a whole building perspective and the only way for them to do that is to be responsible for all of the electricity infrastructure. They often need to manage everything in the building to be able to hit these energy targets but they want the assurance that their tenants can still get what they need.”
Meanwhile, from a data perspective, it’s possible to empower owners and operators of buildings to do things better. “There are a lot of people doing nothing because they're overwhelmed by what is needed to be done from a sustainability perspective.”
Bateman says they often don't have the funding to invest in it or see the value of it. “One way we have helped with this recently is launch a new customer portal which also gives online access for tenants that are billed on sub-meters or square footage.”
With this push for sustainability in mind, Unify is committed to purchasing fuel from renewable sources. In 2022, Bruntwood acquired a stake in a Scottish wind farm at Kirk Hill, Ayrshire, and it pledges support to customers exploring on-site power generation. This stems from Bruntwood's drive to generate 30% of its energy on-site by 2030.
This setup is not limited to office buildings, it can work on industrial sites and science parks too. “It very much depends on what metering infrastructure is there and what additional metering works the landlord wants,” says Bateman.
Being the only energy provider doing this in the market, Unify’s product is getting attention from other managed service providers who are approaching the company to ask if they could ‘white label’ the system and sell it under their own branding. “There's nobody anywhere near this at all,” says Bateman, “it's not just about technical capability, but understanding the operational implications of what goes on within a building.”
Bateman says they often don't have the funding to invest in it or see the value of it. “One way we have helped with this recently is launch a new customer portal which also gives online access for tenants that are billed on sub-meters or square footage.”
There is also tacit knowledge involved, says Bateman: “We are energy experts, but we're also property experts who understand and empathise with what's involved in running and managing a commercial property.”
