Future Energy Pricing

Stick or twist? Future energy pricing

The price of gas and electricity is at an all-time high for businesses.

Brexit, the pandemic, climate change and now a war on the continent are all squeezing our way of life in the UK and affecting things we have previously taken for granted.

Skyrocketing costs of materials and utilities are forcing businesses to re-evaluate their models and threatening margins in all sectors.

The multi-billion pound question is: when will things start to improve?

That is the prediction that business owners are being forced to make around the country on a daily basis.  They need to be able to see into the future to make the right calls on which direction to take their operations.

This applies to utilities too.  For high energy consuming businesses, where energy is a key expense, reaching the right conclusion could be the difference between positive or negative growth.

GAS can be your ace in the hole for future energy pricing

At Great Annual Savings Group (GAS), we can offer guidance for business owners to minimise price rises and ensure you choose the most appropriate course of action.

Can we predict the future?  Absolutely not.  But we can offer sound interpretations of market conditions, which will lead to peace of mind and a robust long term energy strategy for your business.

THE EXPERTS

As markets began to rise in 2021, GAS advised its customers to take longer term power contracts to gain the edge and a bonus few years on their current rates.

60 high-consuming customers collectively saved more than £9.2 million based on GAS’ advice, when comparing rates to the period they would otherwise have procured.  They saved an average of more than 40 per cent and are protected until as far out as 2027.

READ MORE: Read our energy market updates to find out how the market reached crisis point here.

Why waiting is a risky strategy

Many businesses our people speak to are hoping supplier pricing will reduce this year.  They cite a potentially short-term resolution in Ukraine; anticipated support from the government; the seemingly unsustainable position of the market; and media use of the term “crisis”.  This is leading businesses to deduce that this is a temporary situation.

Unfortunately for everyone, the wheels are now set in motion for elevated energy pricing to be in place for years, rather than months.  Chris O’Shea, CEO of British Gas owner, Centrica, says his firm expect the current issues to last for at least two years1.

Businesses should weigh up the contributing factors when taking the gamble that prices will improve.  Namely:

    • Will the situation in Ukraine have eased when you are expecting to procure?
    • Will relations have improved with Russia?
    • Will UK renewable capacity have improved exponentially?
    • Will supply of natural gas be more plentiful?

GAS’ experts can offer sound advice on the contributing factors and help you make a judgement on the best time to purchase for your business.

Every business is different and so speaking to an expert is always a beneficial exercise, particularly when there is no charge for their time.

Read more energy and cost saving advice over at our Business Advice Hub. 

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Paul JohnsonGroup Financial Director

Paul Johnson is very much a home-grown talent.

He joined Great Annual Savings Group in its infancy, fresh from a youth career as a professional footballer with Hartlepool United.  He quickly established a reputation within the business and aced all required accountancy qualifications in the space of four years to become the Group’s Management Accountant.

Several successful projects later, Paul was promoted to Head of Finance.  When the former FD left GAS, he took on the mantle of the business’ most senior finance professional; boasting a string of incredible achievements all under the age of 30.

Quote:

“I have witnessed phenomenal growth at the Group over the many years I’ve worked here and I’m looking forward to guiding the Group into an exciting new chapter.”

Interesting fact:

Paul made his professional debut for Hartlepool United against Bournemouth in the Football League.  Some say Danny Ings still resides in his pocket to this day.

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