The emergence and spread of coronavirus has resulted in many records being set within the energy industry.
We had written a piece recently that outlined how Brexit could affect energy prices, but the Brexit impact could pale into relative insignificance in comparison to the biggest challenge the country has faced since wartime – Covid-19.
These changes are largely occurring due to a changing demand in energy during the lockdown period. As many businesses close, energy usage across the country has dropped – up to 12% in the UK. This change in demand has been likened to the typical usage over a weekend period only and has led to the change in demand for where our energy comes from – namely in coal. Many countries have announced that, during lockdown, there had been no reliance on coal power for over two weeks – for the UK specifically, this helps align the goal of being completely free of coal power by 2025. Furthermore, this adds solid momentum, as we head towards the summer months where there is less demand for coal power too.
The second record set is within the oil sector – namely the huge drops in price as the aviation industry shut down and vehicles remained off the road. At the peak of the virus, the price of WTI Crude – a benchmark crude for the US – dropped to a record low of negative $40 per barrel, something previously unprecedented. This dip in overall prices has led to new fixed energy tariff deals for household energy, with costs set to remain below £800 – the first time in two years that figure has been achieved. The current price difference between the best deal on the market and the current average household deal stands at £398, a significant potential saving for those looking to change their energy tariff.
There may be a quick shift over time, however, as average daily electricity use at home has risen by an estimated 30% during quarantine – a rise of around £18 in value. Whether or not the quarantine figures will be factored in or not, is yet to be seen, and the bounce back of pricing once the pandemic ends may cause a significant vertical shift
For now however, it looks as though energy prices have taken a huge drop and the opportunity is rife for significant savings. Get in touch today to see how Utility Trade Group’s specialist Account Managers can find the best energy deal for you.
