There is much debate as to what will happen to business energy prices over the coming 12-36 month period. Well here is a prediction that will shock many.

Business energy prices will drop, and drop quite heavily!

Why would I say that when many in the industry are saying the opposite? I’ll tell you why, because many in the industry do not have a clue. They rely on the information from sources that have a vested interest in talking up business energy prices.

I could talk about core supply fundamentals of the electricity generation market, and bore you to bits. The key to understanding future business energy prices is simple. Take a look at what your supplier is trying to talk you into.

Energy suppliers are responsible to their share holders NOT their customers. Every decision they make is about increasing the profitability of their business and increasing the margin they make on a kWh. So the rule of thumb which I’ve learnt working in the industry for over a decade is – whichever way the power companies are pushing  - we push the other!.

We had a small number of customers who, spooked by the massive energy price increases in late 2008 – early 2009, were persuaded, against Bluemark advice. To fix prices for 3 and 4 years. Which meant that they fixed prices at the top of the market and were stuck with these very high prices and could not benefit from the drop in the market in late 2009 – early 2010.

Needless to say, some have learnt a very hard lesson with regards to taking advice on contract length from suppliers direct.

Energy suppliers spend a huge amount of money on market analysts; these people provide future price trend analyses and forecast what future energy costs will be. The information they provide is the basis of how much energy suppliers will charge you for electricity in the future. So a 3 year fixed price electricity or gas contract will be priced according to how these analysts see future prices.

A number of the big six are our now pushing 3 year prices and offering them cheaper prices than a 12 month contract. They are not doing this to be nice to you , they are doing it because they know that prices will drop next year and the year after and they have fixed you at a higher price than will be available next year and the year after.

So buck the market and do not allow anyone to talk you into fixing for 3 years, because with the exception of 2007 when prices were on the floor, these contracts have never proved good value.

If you are coming out of contract and need to compare business electricity prices. If you’re looking for honest, impartial advice then call Bluemark, your business energy experts.