News Archive - gas

Meeting the challenges of energy procurement head on

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COVID-19 has brought so much uncertainty to the world as people wonder what their future prospects may be, personally or professionally.

The energy market has certainly not been immune to this either, with plummeting oil prices amidst a major downturn in business energy consumption being reflected in historically low business energy costs.

And renewable energy projects and EV installations, which were set for a boom year in 2020, have been held back, especially in the initial stages of the pandemic, because of a disrupted supply chain.

With so many factors to consider – political posturing can also be thrown into the mix – understanding the market and the mechanisms that may trigger wild fluctuations in the price of electricity and gas is vital to successful energy procurement negotiations.

Even for the most trained eye, unprecedented times like these can be extremely challenging for brokers in advising clients on when to sign on the dotted line with energy suppliers, and the length of contract most preferable for their needs.

A good level of market intelligence – through experience and software such as EM-Powered, the energy management portal – is vital in procuring energy at the right price and at the right time.

Minimising those energy costs through smart energy procurement – and taking the hassle away from clients – is at the heart of what we do.

With over two decades’ worth of experience, Energy Management explores the range of options available to their clients, from a fixed-price, longer-term arrangement that allows for greater security, planning and budgeting to a more flexible approach, where advantages can be derived from fluctuations in energy pricing.

Our consultants are experts at knowing which way ‘the wind is blowing’, so why not give them a call, on 01225-867722 or email:sales@energymanagementltd.com

 

Brent Oil has dropped to an 18-year low

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Brent Crude Oil dropped to an 18-year low on 30th March, prompting a knock-on effect in the energy price market.

The commodity’s international benchmark fell by as much as 13% to a low of $21.65 a barrel. Meanwhile, the price of US West Texas Intermediate (WTI) fell below $20 a barrel and also closed to an 18-year low.

The global oil industry has faced a sharp drop in demand due to countries across the globe being on lockdown due to the coronavirus with prices falling by more than half in the past month.

Despite this, Saudi Arabia and Russia have agreed to flood the market with oil in April and a rise in the price of energy is expected on the back of this, certainly if you compare electricity prices and gas prices to those in March.

So, if you are looking to get a price for your gas or electricity (or both) while this window of opportunity within the market exists, then please get in touch with one of our sales team on 01225 867722 or email sales@energymanagementltd.com.

EM-Powered – the secret weapon in managing your energy costs

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To reduce energy consumption and consequently your company’s energy bills, you first need to have a very good understanding of your energy profile.

Energy Management’s energy monitoring and reporting portal, EM-Powered, assists companies in compiling an instant overview of their organisation’s actual energy consumption, predicted energy consumption and peak loads in an easily downloadable report.

Especially useful for multi-site operators and energy-intensive industries, the portal can be adapted to suit an individual company’s needs.

Here’s a breakdown of some of the benefits:

  • Accurate financial reporting – incorporates budget management tools, cost and consumption break downs. Management reports can also be downloaded for an overview of all activities. Ideal for board-level reporting.
  • Market forward pricing – We provide live forward and historic market trading prices. These prices can then be compared between specific dates, or alternatively can be expanded to show a high-level overview. The portal provides the ability to set multiple price notification triggers and alerts. These alerts will then be either sent via SMS or email to the user. Invaluable for flex contract management.
  • Seasonal comparison tables – Market charges can then be compared in table form, giving the customer an accurate and concise method to measure market fluctuations. The system provides you with the current position, and with a comparison to the previous day, week, month, quarter, 6-month and 1-year prices. In addition, you have the ability to choose specific dates, forward or backward, to compare prices over any given time.
  • Market Intelligence Updates – Customers are provided with a daily market intelligence update. The portal will update 3 times a day providing them with the live day ahead, month ahead and 2-month ahead prices. There will be a short commentary of why prices have fallen/risen, along with prices on Brent Crude and EU ETS Carbon, as both have an impact on UK wholesale electricity cost.
  • Daily Updates – Daily news updates are provided within the portal which gives an understanding of current geopolitical factors which may influence the market.

More information about EM-Powered can be found here.

Smart meter roll-out moved back

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Smart Meter roll-out deadline delayed by four years until 2024

Smart meter technology allows energy users to monitor and measure real-time energy consumption without the need for a physical meter reading, saving time and helping to improve efficiencies.

Recognising the important role they play in saving energy consumption, the government’s ‘smart grid’ plan was for all Gas and Electricity suppliers to take steps to roll out smart meters to all their 1, 2 (domestic), 3 and 4 (Small business) class customers by 2020; however, this target has now been extended to 2024.

Why has the smart meter been delayed?

With 35 million homes still without a smart meter, it was felt that levels of customer service would be compromised if the scheme was rushed through.

Also, as time is no longer in such short supply, energy companies will also be less inclined to adopt aggressive techniques to try and encourage people to have smart meters fitted.

By dropping the date back to 2024, this allows time for fixing any meters that are already in use but suffer from poor connectivity and any other issues.

Rising costs

The government are working hard to make sure the cost to customers isn’t too high. Already, the cost of the roll-out has gone from 11 billion in 2016 to 13.5 billion today and this has been passed on to the customer through higher energy bills.

The consumer group, Citizens Advice, welcomed the decision as they acknowledge it has been done in the best interests of the customer.

 

Expert warns of post-Brexit gas supply shortages

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The EU could reduce winter energy exports to Britain after Brexit, warns industry leader.

According to European energy mogul, Marco Alvera, Brexit may place the UK at danger of gas supply shortages and increasing winter prices.

Alvera presently heads the GasNaturally European sector group and is CEO of Snam, Europe’s largest natural gas utility.

Nearly half of the gas supply consumed in the United Kingdom comes from Europe and public statistics state that in 2018, 39% of the country’s total energy supply was produced by natural gas.

However, Alvera informed the BBC that during cold spells gas exports to Britain could be limited.

He said: “We’ve spoken to several ministers and civil servants over the last two years. Energy has not been discussed enough.

“I would make [energy] a high priority in the discussions, and I haven’t seen it be like that.”

Tariff tip-off

Alvera also advised that despite UK dependence on imported natural gas resources over the winter, the introduction of tariffs on its gas and electricity exports after Brexit may not be prevented by EU nations.

He added: “In the week [last year] when we had the ‘Beast from the East’ cold spell, the system was already under a lot of strain, and the UK was taking a lot of gas from Europe that was stored in Europe”.

Alvera also pointed to the decrease in the UK’s own North Sea gas supplies and the shutdown of components of its gas storage facilities as problems that exacerbated European energy dependence.

Storage solution

He thinks, however, that converting unused gas fields in the North Sea into storage facilities could help to solve the problem.

In 2017, British Gas statistics showed that 44% of UK gas is generated domestically, with 47% coming from Europe (Russia and Norway) and the remaining 9% coming from LNG exports.

Since then, the numbers have raised concerns about UK dependence on Russian power sources while diplomatic relations stay tense.

In Norway’s case, although it is not an EU member state, it falls within the internal market for energy and is therefore bound by EU regulations.

A 2017 House of Lords report on the problem proclaimed it “unlikely” that the EU would place tariffs on gas and electricity provided to Britain after Brexit, even if the UK leaves with no deal.

However, it stated that tariffs could take place elsewhere in the energy industry, including on products commonly used in the construction and maintenance of the energy system.