Over the past six months, the UK energy market has seen consistent increases in both gas and electricity prices. These price rises, driven by supply issues, geopolitical tensions, and changing weather patterns, are likely to continue as we approach the colder months. For businesses with energy contracts expiring between now and March 2025, now is the time to consider your business energy contract renewal. At Smart Energy Company, we can help you lock in a fixed price today for a contract that begins within the next six months.
March 2024: Rising Gas Prices Mark the Start of the Year
In March, both gas and electricity prices increased significantly. Gas prices climbed from 67.35p per therm to 75.20p per therm by mid-month, driven by reduced gas supply from the North Sea and fluctuating weather conditions.
Electricity prices started at £69.50 per MWh but dropped to £60.50 per MWh thanks to stronger wind energy generation. Despite this brief relief, prices have steadily increased over the following months.
April 2024: Geopolitical Tensions Add Pressure
April continued the trend of increasing energy costs. Gas prices rose from 65p per therm to 69p per therm, largely due to geopolitical tensions in the Middle East, which raised concerns about future gas supplies.
Electricity prices followed the rise in gas prices, increasing from £60.50 per MWh to £64.40 per MWh as gas-fired power became more expensive.
May 2024: Maintenance Work Keeps Prices Elevated
In May, gas prices increased further, starting at 70.50p per therm and ending at 83.50p per therm. This was largely due to maintenance work on key pipelines, which limited the supply of gas to the UK.
Electricity prices rose in parallel, climbing from £61.50 per MWh to £75.00 per MWh as the supply of renewable energy dipped and demand for gas-fired power plants increased.
June 2024: Supply Disruptions Continue to Keep Prices High
June saw gas prices fluctuate but remain elevated, averaging 82.50p per therm due to ongoing supply disruptions, including unplanned maintenance in Norway.
Electricity prices averaged £75.28 per MWh, driven by high gas prices and lower wind speeds, which limited renewable energy generation.
July 2024: Brief Relief in the Energy Market
In July, gas prices dipped slightly to an average of 75.53p per therm, as supply concerns eased. However, prices remained high due to ongoing maintenance and the possibility of future disruptions.
Electricity prices averaged £73.61 per MWh, benefitting from stronger wind generation and the return of nuclear reactors.
August 2024: Prices Rise Again as Cold Weather Looms
August saw a rise in gas prices again, with an average of 85.55p per therm, marking a 13.27% increase from July. This was largely due to continued maintenance work and increased geopolitical tensions in the Middle East.
Electricity prices fell slightly to £63.88 per MWh, thanks to stronger renewable energy generation, although market volatility remained high.
Why Colder Weather Increases Market Volatility
As we move into the colder months, the energy market becomes more unpredictable. When temperatures drop, demand for gas increases significantly, especially for heating. If gas supplies are tight or storage levels are low, prices tend to rise quickly as the market struggles to meet demand. This volatility, driven by supply and demand pressures, can make it difficult for businesses to forecast their energy costs.
Plan Ahead: Consider Your Business Energy Contract Renewal Now
For businesses whose energy contracts are expiring between now and March 2025, now is the perfect time to plan your business energy contract renewal. Locking in a new energy contract today can help you avoid the risk of further price increases as we move into the colder months.
At Smart Energy Company, we offer a six-month pricing window, meaning you can secure today’s prices for a contract that starts within the next six months. This allows your business to plan ahead, manage your energy costs, and avoid the impact of future price rises.
By renewing your business energy contract now, you can:
Fix today’s rates: Lock in a stable price now to protect your business from rising energy costs.
Plan for the future: Avoid uncertainty during the winter months when energy prices tend to rise due to higher demand.
Maximise budget control: A fixed-rate energy contract allows you to better manage your financial planning without unexpected price hikes.
Sign Up for Weekly Market Reports
Staying informed about the energy market is key to making smart decisions for your business. Sign up to receive our weekly energy market reports and track how prices are moving in real-time. These updates will help you identify the best time to act on your business energy contract renewal.
Conclusion: Don’t Wait Until It’s Too Late
The UK energy market has been on the rise over the past six months, and prices are likely to keep increasing as we head into the colder months. By acting now, you can lock in a competitive rate before further price spikes and avoid the risk of higher energy bills in the future.
At Smart Energy Company, we can help you find the best energy deals and protect your business from price volatility. Request a free business energy quote today and ensure you’re ready for the months ahead.
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