Research predicts decrease in business energy costs for 2024

New research predicts a decrease in energy costs for business in 2024 primarily due to falling wholesale energy prices.

This is according to Drax Energy Solutions’ latest Third Party Costs (TPCs) Guide, which is cites the decline in wholesale prices as the biggest factor. Wholesale energy prices in September this year are approximately 47% lower than they were in January.

Their analysts say that this fall is mainly due to robust storage reserves, improved supply accessibility and favourable weather patterns.

Although they can’t predict the future it is clear that these factors will help weather potential shocks to the system and it should mean a less volatile market.

The report highlights that third party costs (transmission and distribution costs) will however remain at much higher levels compared to historical data which means that even small changes will be impactful.

So although the total cost will come down, higher third party costs (TPCs) will still mean that bills will remain at higher than price crisis levels.

Paul Miller, Business Energy expert at Drax Energy Solutions, said: “Since our last TPCs Guide in April, we’ve seen the emergence of the Energy Bills Discount Scheme, and now, we eagerly await Ofgem’s forthcoming review of the non-domestic supply market this autumn.

“Notably, the industry is experiencing an accelerating pace of modifications and significant code reviews, all outlined in the new Autumn Third Party Costs Guide.

“Looking ahead to 2024/25, we forecast a range of third party costs will decrease, with fluctuations and new, potential changes, while other TPCs will increase.”

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