In most boardrooms, energy sits somewhere between a facilities cost and a sustainability concern. It’s important, but not always urgent.

Yet as we’ve seen over the last few years, energy prices have not only risen but become consistently volatile, adding a more unsettled and unpredictable impact on financial management. Carbon reporting has also become more complex, just as pressure mounts to decarbonise operations, through everything from legislation, to supply chain demand.

One thing is becoming increasingly clear: energy is a financial issue. And for many organisations, it represents the missing number in long-term planning.

This is why energy strategy belongs firmly on the CFO’s agenda.

 

Energy is no longer just a cost line

Across most organisations, energy remains one of the most volatile and least understood areas of spend. Whether it’s powering production lines, running digital infrastructure, or supporting day-to-day operations, energy costs can quickly escalate, but often without clear visibility into why. This could be because of everything from outdated systems, poor procurement decisions, and a lack of real-time data, leading to inefficient consumption and rising bills that go unchallenged.

This is where a clear energy strategy becomes essential. By moving beyond the idea of energy as a fixed overhead and instead treating it as a dynamic, manageable input, CFOs can take greater control of spend, reduce financial risk, and unlock savings that strengthen the bottom line.

 

Energy risk is financial risk

The cost of energy has always been subject to change, but recent years have shown just how sharp and sudden that change can be. Geopolitical tensions, supply disruptions, and market uncertainty have made it harder than ever to predict energy spend. And when you’re managing a multi-site operation or energy-intensive processes, the impact on financial planning can be significant.

A well-designed energy strategy doesn’t just help organisations buy better; it builds in flexibility, so that businesses can adapt quickly to external pressures. That means reviewing contract terms, exploring fixed versus flexible procurement, and using data to forecast demand more accurately.

 

Compliance is no longer optional

From Streamlined Energy and Carbon Reporting (SECR) to evolving Net Zero obligations, the regulatory landscape is constantly moving and demanding. And meeting reporting requirements and sustainability goals now requires more than box-ticking; it requires clear, auditable insight into how energy is consumed, where emissions are coming from, and what action is being taken.

For CFOs, this introduces both a compliance challenge and a reputational risk. Without a coherent energy strategy, many organisations find themselves reacting to regulation rather than planning for it, which can come at a greater cost. Embedding energy into financial decision-making can help ensure compliance doesn’t become a reactive scramble, or a strain on resources.

 

Visibility can deliver greater value

An energy strategy isn’t about installing solar panels overnight. It’s about gaining visibility and getting clarity. Where are you using the most energy? Where is it being wasted? Which systems are driving cost without delivering value? And how can you reduce consumption without compromising performance?

When energy data becomes part of regular financial reporting, organisations are better equipped to identify savings, prioritise investment, and measure ROI. It also enables a better approach to things like maintenance, extending the life of critical equipment and avoiding the cost of reactive repairs.

 

Finance and energy need to work together

The role of the CFO is constantly evolving, perhaps the largest shift in moving from commercial gatekeeper to embedded strategic partner. In the same way finance is embedded in IT, HR, and operations, it now needs to play a central role in shaping energy strategy.

In doing so, the biggest gain will be to shift perceptions of energy from a that of a cost-centre to a strategic lever, which presents the opportunity to reduce costs, derisk operations, decarbonise, and build a more resilient, sustainable business.