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Energy Buying & Markets
Environment & Sustainability
COVID19 has had a considerable impact on the UK economy and has resulted in further issues for businesses when it comes to arranging energy supply contracts. Certain industries have been impacted more than others: with hospitality, leisure, tourism and also manufacturing businesses reliant on international trade feeling the effects.
The COVID Credit Crunch is creating a number of scenarios where suppliers are unable to provide businesses with the required credit, which has a knock on impact, with business typically being left with one of three options:
- They are forced to take out contracts with alternative suppliers that might not meet all of their objectives or requirements
- They are forced to pay security deposits upfront, where previously this wouldn’t have been the case
- They are having to accept paying premiums of up to 10-15% on their contracts.
Whilst it depends on the supplier, more businesses are now seeing a requirement for a case to be built on their behalf, in order to prove their eligibility for credit. If you find yourself in this situation make sure you work with an energy consultancy that understands your requirements.
The UK has curbed its electricity demand during the last decade, using almost 20% less electricity in 2020 than it did in 2010. Even ignoring 2020 data as an outlier, 2019 showed a 14% reduction in demand compared to 2010 figures.
This combination of reduced demand and changing the mix of the electricity on the grid has enabled the UK to reduce its scope 2 emissions by 70% over the decade, but there is still more work to be done to meet ambitious targets set for 2030 and furthermore to be carbon Net-Zero by the planned 2050, particularly if the UK’s demand for electricity is likely to double as anticipated in the Governments latest Energy White Paper.
Investment in offshore wind will increase the share that renewables will be expected to bear and while nuclear power will continue to provide baseload. It is expected that carbon taxes on gas will increase considerably, making current ‘gas to grid’ generation much less attractive than it is today, further increasing the reliance on renewables.
Businesses can get ahead of the curve and all but eliminate their scope 2 emissions from electricity now by committing to purchasing 100% renewable power as part of their electricity supply contracts, and products like the 100% renewable energy basket from Businesswise Solutions can provide access to premium & emissions-free power regardless of the size of your business.