UK Business Energy Market Review: Q2 2025

Q2 2025 UK Business Energy Market Review

As Q2 wrapped up, energy markets showed sharp price shifts across gas and electricity — offering clear opportunities for businesses to fix before future risk returns. Let’s break down what happened across April, May, and June, and what it means for your contracts.

✅ At a Glance: What Happened in Q2?

📉 Gas fell 5.4% overall: April to June saw average gas prices drop from 86.22p/th to 81.61p/th

⚡ Electricity fell 12%: Prices dropped each month — from £81.48/MWh in April to £71.43/MWh in June

📅 Three consecutive monthly declines

📊 June power hit its lowest level since December 2023


🌍 Global trade tensions, stable LNG supply, and weak demand influenced prices

🌤️ Monthly Price Snapshot (Q2 Recap)

Key Takeaways:

• 📉 Electricity fell 12.4% from April to June

• 🔄 Gas dipped in May, then climbed back in June — largely driven by storage, not supply cuts

• ⚠️ Volatility hasn’t disappeared — but these price drops offer a window for forward planning

📉 Q2 average gas price: 83.48p/th
📉 Q2 average power price: £76.90/MWh

🔎 What Drove the Market?

🌍 Geopolitics & Global Trade

• Red Sea disruptions and ongoing US-China tensions drove market nerves in April
• Iran-related risks simmered but didn’t escalate
• Tariffs and trade policy continued to impact equipment and infrastructure costs indirectly

🌤️ Weather & Renewables

• Mild conditions meant lower heating and cooling demand
• Wind output was strong in April and May, supporting grid stability
• Shorter-term sunshine boosts helped suppress daytime pricing in late June

⚡ Supply, Storage & Infrastructure



• LNG flows remained high, particularly from the US and Qatar
• UK gas storage refills began earlier than usual, lifting June gas prices
• Two nuclear plants returning from maintenance helped pressure electricity costs lower

🔎 12-Month Market View: Are Prices Falling?

Prices are now well below their winter peaks, helped by falling demand and favourable supply.

🔻 Gas is down 21% vs January 2025
🔻 Power is down 43% vs January 2025



This quarter confirmed a sustained downtrend — but markets remain volatile, especially as winter pricing risk re-emerges from Q3 onwards.

💡 What This Means for Your Business

💬 Expert Insight from Smart Energy Co.

"Geopolitical tensions — like the recent Iran–Israel conflict — are a stark reminder of how quickly energy markets can shift. Even events thousands of miles away can cause major price swings here in the UK."

"With prices having eased across Q2, this could be a rare window to secure stability before risk returns — especially for those renewing in the next six months."

We help businesses compare over 28 suppliers, make sense of contracts, and avoid costly guesswork.

Why Business Work With Us

Rated 5 Stars by UK Businesses

“Tom’s updates on energy prices have saved us money year after year. Highly recommend the Smart Energy Company.”

🔮 Looking Ahead to Q3 2025

Here’s what we’re watching as we move into July:

• Will gas storage fill too quickly and trigger price dips or congestion?

• Will summer heatwaves increase cooling demand and electricity risk?

• Could geopolitical flare-ups disrupt LNG flows or shipping again?

• Will Ofgem's network cost review affect business pass-through rates?

🔍 Final Thoughts

Q2 gave businesses a rare 3-month stretch of falling prices — with power hitting its lowest point since December 2023.

Whether you're renewing soon or just want to stay ahead of the curve, now is a smart time to:


✅ Review quotes
✅ Understand your renewal window
✅ Fix before market sentiment changes

📥 Ready to Review Your Options?

Don’t wait until prices climb again. Get a fresh quote today — no pressure, just clarity.