Overview of the UK Electricity Market

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The next decade is going to be an extremely difficult and expensive time for business electricity customers. Business users have always got the raw end of the stick. Any increase in domestic energy prices tends to become a political issue and heavily reported by the media. While 30% or 40% increases in business electricity prices are common place and do not generate the same media interest. With large increases in electricity prices forecast for the coming decade it will be business customers that end up paying the highest price.

Business Electricity Market Overview At present the UK is supplied with electricity from a portfolio of ageing conventional generation equipment consisting of nuclear power plants, coal and oil-fired condensing steam power stations, hydro-power, pumped storage, a growing portfolio of wind energy, and other, mostly intermittent, renewable energy projects.

Between now and 2015 the UK is likely to see the retirement of up to 30 GW of nuclear and coal generating capacity, some 37% of the country’s total capacity, in order to meet international treaty obligations. Thus, the UK looks set to become even more dependent on natural gas to generate electricity.

With North Sea gas in rapid decline, the UK will become the world’s largest sovereign gas importer. International demand for gas appears to be rising faster than global export production, creating increased competition for gas, with the consequent effect on price to electricity generators. The price of electricity to UK customers will also have to bear the brunt of the massive investment needed in the UK's generating and supply infrastructure

If your business is to remain competitive , getting the best possible electricity tariff and making sure you stay on it year after year will become even more important than it is today

For wholesale electricity prices and a weekly summary of current conditions in the UK electricity market visit electricity wholesale prices.