Vish Sharma, Head of Power Purchase Agreements, npower Business Solutions (nBS)
Energy has become a pressing issue for organisations across the UK. Wholesale markets remain uncertain, non-commodity costs (the network, policy and system charges needed to fund the low-carbon transition) are rising, and organisations are now regularly exposed to energy price volatility.
In fact, in our latest Business Energy Tracker, energy was ranked as the most significant business risk by 65% of respondents for the fourth consecutive year, while 79% expect their energy invoices to rise over the next 12 months.
With fluctuating costs, regulatory changes, and pressure to decarbonise, energy managers have multiple considerations when it comes to managing their costs and consumption.
However, they should not lose sight of a bigger opportunity: energy can become a positive asset for those organisations that invest in on-site generation.
Greater control over energy use
On-site generation gives organisations more control over how they generate, use and manage power. Solar PV, wind, and battery storage can all help reduce reliance on imported electricity and keep costs down.
The starting point is visibility. By using half-hourly data, sub-metering and asset-level insights to identify where demand is highest, when peaks occur and how best to match generation to operational needs, energy managers can access greater insight into how and where they use their energy.
Energy visibility is already a priority for many organisations. Our Business Energy Tracker found that 71% are increasing energy efficiency to manage energy risk, while 40% are using energy management tools, and 40% are shifting demand to off-peak times. Among larger energy users with annual spend above £1 million, 40% are looking to invest in on-site generation.
Supporting resilience and emissions reduction
Business continuity has become a bigger priority for many organisations. Energy disruption, market volatility and pressure on the wider electricity system can all create operational risk.
On-site generation can help reduce that exposure and provide an additional layer of resilience. When combined with battery storage or flexibility measures, they can help sites manage peak demand, maintain critical operations, and reduce reliance on imported power during costly peak periods.
This is particularly valuable for organisations with continuous or sensitive operations, such as healthcare, cold storage, logistics, manufacturing and data-led environments. For these sites, energy resilience is central to service delivery, safety and operational confidence.
On-site renewable generation can also reduce Scope 2 emissions by lowering the amount of electricity imported from the grid. In addition, it can support wider decarbonisation plans, including electrified heating, electric vehicle charging and more efficient building systems.
Turning power into value
For some organisations, on-site generation creates an opportunity beyond managing their own consumption. Where a site produces more electricity than it needs at certain times, exporting excess power can create an additional revenue stream. A Power Purchase Agreement (PPA) can provide a route to market for this exported electricity while supporting other businesses seeking access to renewable power.
PPAs are a bilateral contract – typically between one and 20 years – between a generator and a buyer. They encompass all the commercial terms required to deliver a route to market for generation, including start dates, delivery schedules, pricing mechanisms, and payment terms.
The best choice of PPA for a renewable generation asset will depend on several factors. These include the level of annual output, the nature of the generation source, a company’s risk appetite and ultimately, whether there is a desire for a steady revenue stream or a wish to optimise profits with a flexible agreement.
While energy managers should carefully consider export capacity, grid connection, metering arrangements, generation profile and contractual terms, they can unlock significant commercial potential by selling their excess power.
A strategic opportunity
On-site generation is becoming an increasingly popular and practical option for organisations seeking greater control over their energy. For energy managers, the benefits span cost management, emissions reduction, resilience, building performance, and long-term planning, as well as the opportunity to earn revenue via selling their excess power to other commercial organisations.
The most successful projects start with a clear understanding of the site, its energy profile and its operational priorities. By bringing together operational insight and strategic energy planning, energy managers can help their organisations reduce risk, unlock value and build sustainable estates for the future.
This article appeared in the July/August 2026 issue of Energy Manager magazine. Subscribe here.
