Business Energy Market Update: September 2024

August saw small increases in wholesale cost of roughly 4% across the board for electricity. Gas forward contracts fell slightly for deliveries in the run up to the end of this year but rose in line with the bullish electricity market further out.

EU gas storage is still currently above 92% full and three tankers are due to arrive from the US over the next few weeks so in the short term, gas prices are likely to stay stable. There is a possibility the market may turn bullish though as wind generation is forecasted to remain low over the next couple of weeks which may increase gas demand for power generation.

One of the most productive Wind farms in the UK opened for business last Thursday but has already come under intense criticism. The Viking Windfarm in the Shetlands which is also the largest onshore windfarm in the country caused controversy when its operators SSE, received nearly £2.5m in payments in just a matter of days from The National Grid, not to generate power. The windfarm and a 260-kilometre subsea transmission link to transport electricity to the mainland form part of an investment of over £1 Billion by SSE into green energy which was initially lauded by environmental groups. However the recent payments have been heavily criticised and will ultimately be recovered from end consumers energy bills to the detriment of all energy users.