Energy price update

Energy price update 2019 Q2: Gas prices stable

Warmer temperatures and new LNG imports to keep gas prices stable.

Gas reserves well stocked

Weather forecasts anticipate water weather to reach us in April, which will help alleviate demand on gas supply. In turns this removes pressure on gas prices. Additionally, early April will see the arrival of LNG (Liquefied Natural Gas) tankers, to aid gas supply in the UK.

Against this, oil price increases could stop gas prices falling. OPEC have reduced production to keep oil prices at current levels. Gas prices and oil prices are loosely linked historically.

Looking further ahead, with the LNG tankers keeping us well supplied in gas, any fall in temperature may have a negative effect.

Electricity outlook

EDF will close their coal-fired power station in Cottam, Nottinghamshire at the end of September.

Once this plant has closed, the total capacity of coal-fired per plants will fall to between 8 and 9 GW. A large fall from 23 GW as recently as 2011.

A prolonged increase in renewable electricity production has helped to stem the recent increases in electricity prices a little.

Record high for renewable generation

BEIS released new statistics, confirming that over 33% of all UK electricity generation in 2018 came from renewables. Mainly due to a 9% increase in renewables capacity in the previous 12 months.

Wholesale electricity prices can benefit from increased renewables output, more likely to be seen during favourable (wind and sun) weather conditions.