Two-thirds of school energy deals to run out by spring

The Department for Education has at last revealed results of a schools energy deal survey, which it undertook in May
22nd September 2022, 4:12pm

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Two-thirds of school energy deals to run out by spring

https://www.tes.com/magazine/news/general/two-thirds-school-energy-deals-run-out-spring
New education secretary Kit Malthouse has been warned doing nothing is not an option on teacher pay and soaring energy costs.

About two-thirds of schools’ energy deals will expire within the next seven months, according to data from a government survey.

The Department for Education (DfE) issued a survey to all schools and trusts in May 2022 asking them about their gas and electricity contracts.

However, the DfE told Tes in July that the release of the survey results had been delayed owing to “political events”.

Now, the DfE has published the data, and said that 60 per cent of respondents’ gas contracts would expire by 30 April 2023, along with 67 per cent of electricity contracts.

And it added that 33 per cent of gas contracts would expire by the end of next month, along with 39 per cent of electricity deals.

Wholesale energy prices have gone up this year and many schools that renew their energy contracts are seeing bills soar because their current deals were signed before the rises took hold.

A package of support unveiled by the government this month will partly protect schools until at least the end of March, with a review promised in January to determine if it needs to be extended.

However, sector leaders have said that more certainty is needed on further support as schools need to plan their budgets for the whole academic year.

This latest data shows that the majority of schools will be vulnerable to higher prices at the time the support is set to end, as their deals will expire during or soon after the scheme’s initial duration of six months.

Responding to the data, James Bowen, director of policy at the NAHT school leaders’ union, said that while the data only related to a small proportion of schools, it “remained a concern” that so many deals were close to expiry.

“Some of the quotes schools have received in recent months have been simply eye-watering. While the recent support package may help to soften the blow for some, a combination of cost pressures are continuing to push many school budgets beyond breaking point,” he said.

Schools need more certainty than they currently have from the government on energy costs, he said.

“Schools need to be able to budget for the full year, and to know what prices they will be facing in the spring term. Without that certainty, many will feel they still have no choice but to divert money towards energy, and away from education, to avoid a nasty shock in six months’ time.”

Geoff Barton, general secretary of the Association of School and College Leaders, said that while he welcomed “any action” by the government to understand energy costs, it was “frustrating that this particular survey tells us very little and is somewhat out of date, as it ended in June and has taken more than three months to publish”.

“We’re not sure that the government really does understand the huge pressure of energy costs on schools and colleges,” he said.

The non-domestic energy price guarantee scheme, “while welcome in as far as it goes, is limited to six months”.

If schools and colleges are then “hit with the full force of unrestrained energy costs”, this will necessitate significant cuts “which will affect educational provision and standards. It is as simple as that,” he added.

The DfE said, in the report that accompanied the survey, that schools were facing “extremely high and volatile energy prices due to multiple and changing market conditions”.

But it also said the small sample size from the survey, which it said represented 2,300 schools - less than 10 per cent of the overall estate - was “not fully representative of the whole sector and inferences should not be drawn from these findings”.

It also said that, as schools are autonomous in their contracting decisions, “the department has no visibility on schools’ contract information and cannot quantify the true impact of the energy prices on school budgets, nor the scale/risk of Russian-supplied gas to the sector”.

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