Continued Brexit Uncertainty – Impact on Energy Prices Moving Forward
The vote was made back in June of 2016, that the UK would be leaving the European Union. However, over three years down the line and we have yet to see an exit, despite the date being set for the 29th March earlier this year. In fact, the EU have recently granted another extension until early 2020.
This uncertainty has led to fluctuations across an array of markets, and this includes energy – something which we touched upon in a blog post back in February.
The energy market has been marked with a major red flag, which is little surprise, following a large drop in the pound, the slowing of the UK economy, and several major businesses looking at leaving the UK, following the vote. Last year saw two significant rises in energy prices, which were attributed to the ever rising costs of wholesale gas and electricity. Household energy bills are only set to rise further this year, as the continued uncertainty of the situation escalates. Britain remaining in Europe’s carbon trading scheme, the EU Emission Trading System (EU ETS) after Brexit, also remains a key uncertainty.
The term ‘deal or no deal’ becomes ever more prevalent, as the UK is still no closer to finding out what the general direction may be. If the UK were to leave without a deal in January 2020, then they will be committed to the WTO trading legislation. This would likely lead to a rise in energy bills, as trade barriers would increase the cost of gas and electricity passing the border. At present there is free movement of these services, which is why it is cheaper, and no additional tariffs have been passed down to energy bills.
These could be increased however, as the fear of increased transportation costs heightens. Power companies and lead industry bodies are becoming ever more fearful of such an outcome, urging politicians to strike a relevant deal to prevent these tariff barriers coming to fruition
So, just what can be done to tackle the potential rise in energy prices?
The most positive move to make is to ensure you are signed up to a fixed-rate deal ASAP, so as to avoid the uncertainty that Britain’s EU departure in January brings. Here at Utility Trade Group, we are experts in energy management. Our buying power in the market, along with our specialised managed service, provides you with clearer visibility of your consumption, unlocking greater control of your energy costs, increasing your profits.
Get in touch today to see how we can help your business, amid the uncertainty of Brexit.
