As energy bills soar, none of us will be able to operate in the same way
The rising energy costs sit alongside rising costs across the board: everything from the costs of toilet paper in our public toilets, to the free sanitary products we provide for visitors and staff, and the cost of milk in the café.
We aren’t the only sector feeling this crush; schools are expecting increasing costs of between £300,000 and £500,000 next year without any additional government support. This will surely have an impact on school visits to museums, while the general inflation and financial insecurity individuals are starting to feel will impact their decisions of whether to spend money on admission tickets, shops and café.
Increasing energy costs are just one aspect of a far larger picture that is emerging, one that shows costs rising in every area of our work. Income will likely be down from both earned income pathways and funders, who are experiencing lower levels of return on their investments, which give them the funds to support our work.
Energy increases are however a particularly challenging aspect of this wider cost increase. Museums, like all other businesses, including schools and hospitals, don’t have a price cap. This can put us in a more vulnerable position as energy companies are likely to try and recoup any losses that they feel they experience via price caps for home use on businesses.
At the Jewish Museum London, we are currently on a fixed price plan. It didn’t protect us from the first huge increase, but has from the more recent and upcoming ones. I can thank our fantastic operations team for this diligence.
So while our costs are increasing by around £50,000, we have something to protect us and more importantly, something that we can use as a projection of costs.
By the end of 2023, it looks like we’ll be spending around £85,000 per year on energy compared to £30,000 in 2020. But this is just one increase of many. For us, the total increase of all costs rising is likely to be around £120,000 by the year’s end. Finding an additional £120,000 this year will be a huge task – finding it every year is very challenging.
Why is energy use so high? Although our museum may look new, behind the displays is a Victorian building with all the complications they bring! In addition, we require constant temperature and humidity controls across all our galleries and collections store rooms due to the type of collections we care for, including a specialist Designated Outstanding collection.
Even if no one is in the building, energy is required for this purpose. Our systems are not energy-efficient and there is little we can do with the current systems to reduce our energy consumption. Funding to support replacing boilers and building management systems (BMS) is almost non-existent. These costs must then come from core, which has already been depleted during Covid. In addition, core is usually built up via earned income, and predictably, will be lower going forward.
The impact all of this will have is becoming clearer by the day, but will depend on a number of external factors, including success with funding applications and whether the government steps in to support museums, charities or businesses.
There is no getting around the fact that rising costs and less income will have an impact on our strategic plans and budgets, which ultimately affects HR and programming. I think we can expect to see museums having to rein in spend, some with a heavier hand than others. The concern of course is that so many museums already did this through Covid.
At the museum, we have started to try and get ahead of what the impact could be. We’ve developed and begun implementing a seven-stage change plan that covers everything from winter opening hours, converting office space to rent out to other organisations and HR wellbeing plans, with a focus on reducing costs where possible and reallocating time within staff roles to new forms of earned income.
It means a lot of change for staff, but we hope that this short-term change will enable more sustainability and less long-term change.
Museums and heritage sites are energy-hungry spaces. We need support from the government in the short term to reduce these bills, as none of us can weather the increases we are facing and remain operating in the same way. We also need grants set up to help us insulate buildings, convert to green energy, and install BMS software that helps us reduce energy use.
I’d like to see our sector bodies lead in this knowledge exchange, maybe even creating spaces that bring people together to talk through what they are doing and share with others.
Behind every museum is a team of staff in learning, collections and visitor experience departments genuinely changing lives with minimal resources.
We need experts in these bodies that understand energy, government grants and financial crises. We need practical and free help now, on courses like how to forecast budgets during a recession. We also need to see pressure put on government, with case studies that show real impact of these costs..
The museum sector is an incredible place. We have been through financial crises before and will do again. Behind every museum is a team of staff in learning, collections and visitor experience departments genuinely changing lives with minimal resources.
There are finance directors creating weekly cash flows and projecting costs on almost no stable information and directors staying up late at night working on matching priorities to budgets and how to explain this to their trustees.
Most of us will find a way, but I think it’s true that some won’t.
Those that do will be different and their staff will be the reason they got there. That’s a good thing to remember as we each develop our plans.
Frances Jeens, director, Jewish Museum London