As the winter chill sets in, so too does a sense of apprehension for the UK energy market in January 2024. Businesses are bracing for a turbulent landscape, marked by higher costs, volatile prices, and potential supply constraints.
The headliner is the 5% increase in the energy price cap, pushing the average annual bill for a typical dual-fuel household to £1,928. As prices rise this is unfortunately not only going to affect families. This translates to increased cost burdens for businesses across all sectors, impacting everything from production and transportation to heating and running equipment.
The culprit behind the price hike lies in the volatile wholesale gas market. Geopolitical tensions and supply chain disruptions continue to exert pressure, with no immediate signs of significant relief. This means even the price cap, while offering some protection, remains susceptible to further fluctuations.
Despite increased domestic gas production, concerns over potential winter supply shortages linger. Cold snaps combined with high global demand could test the UK's energy infrastructure, with businesses in energy-intensive industries potentially facing the brunt of rationing measures.
What can your business do?
- Energy Efficiency & Audits: Prioritise energy-saving measures and conduct energy audits to identify areas for improvement. Investing in efficiency upgrades can offset increasing costs in the long run.
- Fixed-Rate Contracts: Consider locking in fixed-rate energy contracts, if available, to offer some price stability amidst volatile market conditions.
- Renewable Energy Options: Explore adopting renewable energy sources like solar panels or wind turbines for long-term cost savings and environmental benefits.
- Government Support: Stay informed about available government support programs to help businesses with their energy bills.
While the January energy market outlook casts a shadow, it also presents an opportunity for businesses to innovate and adapt. Embracing energy efficiency, exploring renewable options, and seeking government support can be crucial steps towards weathering the storm and building long-term resilience. The ability to navigate this volatile landscape will be a key differentiator for businesses in the months and years to come.
The UK energy market in January 2024 is a complex picture with a bumpy road ahead for businesses. However, by understanding the challenges and proactively adopting smart strategies, businesses can not only survive but also thrive in this new energy reality. Remember, resilience, adaptability, and a focus on long-term energy solutions will be the cornerstones of navigating this turbulent terrain.
If you're looking to save money on your energy bills then why not get in touch today? The relationships Resolve Energy has developed with over 24 of the UK’s biggest business energy suppliers allows our energy experts to source the best business energy rates available for your company right when you need them. Request a free quote today and start saving money on your energy.
