As we approach the colder months, we wanted to bring your attention to the evolving landscape of energy costs and the potential impacts on businesses. The convergence of seasonal changes and ongoing political issues has created a dynamic environment that are likely to affect the energy market.
1. Seasonal Shift and Energy Costs: With the advent of autumn and the imminent arrival of winter, the demand for energy is expected to rise. As the temperature drops, heating systems are set into motion, increasing the overall consumption of energy. This natural shift can result in higher energy bills for both residential and commercial consumers.
2. Ongoing Political Issues: Simultaneously, the energy sector is navigating various political challenges that could readily bring disruption to energy supplies as Arab countries may seek to respond to a continued humanitarian crisis in Israel and Gaza. Also the Australian Chevron LNG dispute is returning to strike action – these 2 terminals produce about 7% of the worlds LNG.
What Does The Graph Show?
The graph no longer includes the major cost spike from August & September last year. Consequently, the decline in costs in the last 12 months seems less dramatic at around half the level of a year ago. Unfortunately, the contract rates customers were being offered in late 2022 reflected the much higher prices from August & September and these very high rates remained in place until early 2023.
Understandably this has led to many customers wondering when is the best time to agree a renewal and as prices continued to trend down was it better to wait and see how far they will fall.
The cost of energy and the movements higher or lower reflect market sentiment about the availability of gas and electricity now and in the future. The issues around Australian LNG and in particular the geo-political uncertainty over Israel & Gaza referred to above, has led to a sharp rise in energy costs this week. It’s not clear how long or dramatic this rise will be, however it is a reminder of how quickly things can change.
Understandably, some customers are waiting to see if these increases which are in the region of 0.5p on electricity & 0.25ppkW on gas will remain in place or if the prices will return to levels offered last week. In making this choice it’s important that customers recognise that prices can go higher still if they chose to wait and that extra £500 could become an extra £1,000 or more.
When Should I Renew?
Anyone with a contract renewal due before April 2024 is asked to consider the following:
Prices have already started to increase and while there is no certainty if this will continue. It is clear is that at least some of these risk factors, especially regarding the Middle East appear likely to deteriorate further and to be ongoing for several months, possibly into next year and beyond.
Nationwide Energy’s field consultants and renewals advisors are committed to providing support and guidance through these dynamic times. Our team is available to discuss your specific needs, provide a market review and update on available prices.
Customers struggling to pay current rates or who are at risk of default can contact the Nationwide Billing Team for support and advice on their options. They are contactable on:-
Call: 02476 328995
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We have just taken on a new pub ourselves which was stressful however, Callum eased the stress by helping us to get the best deals for our PDQs, EPOS, electricity and phone. When there have been any issues during the process, Callum was there to assist in resolving them.
Callum is a real asset to Nationwide Energy Consutants. We are rating as 5 stars due to Callum and his fantastic customer service”
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