Disruption to Energy Supply Among Key Risks Facing UK, says UK Government
The UK Government has just published what it considers the highest threats to UK infrastructure.
The 89 key threats detailed in the National Risk Register (NRR) includes disruption to energy supplies and the potential impact it could have.
The comprehensive assessment outlines the key threats that could significantly impact the UK’s safety, security and critical systems on a national level.
The Register now publicly shares previously classified information about the various potential risks from disruption to energy supplies all the way to malicious use of drones.
The significant thing here is what the invasion of Ukraine by Russia did to gas supply to Europe, the shortages it created and how impactful the issue was to global energy supplies and the massive economic and political fallout it created.
To address this, the deputy Prime Minister Oliver Dowden launched the NRR during a visit to Able Seaton Port in Hartlepool, where the first of over 260 meter tall wind turbines was being installed.
The risk assessment highlighted in the NRR clearly points to becoming more self sufficient and less open to global supply issues. These robust plans will allow the UK to lead the way in developing the worlds largest offshore windfarm which is planned to secure low cost clean energy to the UK and in Oliver Dowden’s words “enabling us(the UK) to stand up to Putin’s energy ransom”
The issue is that until this long term energy security is established, 35% of our electricity is still generated by imported gas.
This means that most of this will need to be be imported through pipes or ships carrying LNG to our shores, all of which attracts huge levels of price volatility as we all compete for the same commodity.
Until we become more self sufficient, prices will unfortunately remain high and subject to much higher levels of volatility.
Track prices before you make a decision on your next contract
The question everyone is asking at the moment is will be prices ease more in the short term. The answer is no one really knows.
If we look at past summers, taking 2022 out of the equation, summer always tends to be the best time to agree to a business energy contract based on basic supply and demand dynamics. The less demand the lower the price.
We expect this period of stability to remain for the comings weeks but we don’t expect prices to drop much lower than the current level (if at all) given all of the supply issues we face as a country.
All of these factors currently have a massive bearing on the wholesale price level, especially when demand picks up as we approach the colder autumn and winter months, which are sadly just around the corner.
What happens if my contract expires in the next 3 – 6 months?
We would strongly advise taking advantage the current level of price stability.
If you still want to stick, we would advise keeping track on the market on a weekly basis. You can do this by checking this page page which is updated every Monday.
You can even subscribe and get the latest price tracker sent to your inbox every Monday morning.