This morning, the Electric wholesale prices have opened up 6.43% higher than this time last week with Gas increasing by 3.40%.
Last week, as the Russian invasion of Ukraine entered its second month, energy prices continued to fall, despite the fact that fundamental gas flows from east to west remained virtually unaltered. Following Putin's demand that 'unfriendly' countries pay for gas in roubles to boost demand for the sinking currency, there was a blip in this trend early last week. Despite the first price shock, European leaders denied the proposal, citing Gazprom contract T&Cs that dictate payment terms in euros, which would be a breach of contract if changed unilaterally.
Energy prices continued to decline last week as the Russian invasion of Ukraine began its second month, despite the fact that fundamental gas flows from east to west remained practically unchanged. There was a pause in this pattern early last week, following Putin's demand that 'unfriendly' countries pay for gas in roubles to increase demand for the plunging currency. Despite the first price shock, European leaders rejected the suggestion, citing Gazprom contract T&Cs that stipulate payment conditions in euros, which if changed unilaterally would be a breach of contract.
Despite a persistent decreasing trend and a (relatively) stable market, many suppliers continue to withhold new business bids or only issue a limited range of contract terms. The difficulty has been exemplified by the shocking announcement that ScottishPower, one of the 'big six' legacy providers, will be exiting the I&C market in stages (no current customers will have their contracts withdrawn and no lay-offs announced). ScottishPower held 4% of the non-domestic 'large-scale' energy market on its books in 2019, according to Ofgem.
Gazprom UK, which supplies 20% of the non-domestic gas market, is coming under increasing pressure from customers wanting to get out of contracts, despite the fact that the company has not been sanctioned directly. Should the provider fail, the UK government has stated that it will intervene to place the company in'special administration,' similar to Bulb. This will come at a high cost to the public, which will be exacerbated by the Treasury's own anti-hedging policy. In the face of rising wholesale costs, Bulb could cost taxpayers more than £3 billion.
How the market has opened each day:
Date Electric (£/MWh) Gas (p/therm)
21/03/2022 194.50 235.00
22/03/2022 197.00 219.00
23/03/2022 204.92 248.43
24/03/2022 230.00 265.00
25/03/2022 220.00 260.00
28/03/2022 207.00 243.00
7 day averages
Electric (£ per MWh) 208.90
Gas (pence per therm) 245.07
The below shows how the market compares to the previous week, month and year.
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