What is the forecast for energy prices in 2022?

The past year has been tumultuous for the energy market, so what do the next 12 months have in store?

Last year, the energy market was constantly making headlines, and not for good reasons. After Brexit and the pandemic, an energy crisis sent millions of households and businesses into panic. Many leading energy suppliers were forced into administration. Customers across the country saw their energy costs shoot up dramatically without warning.

Now, energy customers have been warned that energy bills could go up even further in 2022.

But why has this crisis occurred, and is it likely to stop any time soon? As the energy sector devolves into further chaos, what can UK businesses do to protect themselves?

Why have energy prices been rising?

Industry leaders have described the past twelve months energy market as a “national crisis”. Wholesale gas prices have risen throughout 2021 and led to more than 20 energy suppliers going under. The impact of this was felt by energy customers when a significant rise to the energy price cap was introduced in October. This price cap is set to be reviewed again in April, with many experts believing it will rise yet again.

The dramatic increase in wholesale gas prices has put pressure on the energy industry and exposed the cracks within it. Post-pandemic demand, a cold winter in 2020, and a global shortage have caused wholesale gas prices to increase by a huge 250% since January 2021, rising by 70% in August alone.

The energy price cap rose from £1,138 to £1,277 a year in October – expected to rise again in 2022.

What does the business energy market look like in 2022?

Generally, the cost of living has increased for both households and businesses. Energy customers across the board have been hit by rising energy bills. And with increased demand over winter, industry leaders expect energy bills could be 50% higher in spring 2022.

This is a prediction that has been made by many big names in the energy sector, included chief executive of Energy UK, Emma Pinchbeck, who has warned that “domestic energy prices are going to go up 45% to 50% in the spring.”

This has been labelled as a system-wide issue by Pinchbeck and other industry names, highlighting the flaws in the way our energy industry works. Experts are calling on the UK Treasury to intervene in the crisis as others have across Europe.

Now is the time for businesses to take action and protect themselves from the potential fallout of this matter.

Consultiv Utilities can help you cut your business energy costs

Whatever the future has in store for your energy overheads, Consultiv Utilities are here to help your organisation make the smartest choices and manage your bills effectively.

We are here to help you make sense of your energy contracts, working with you to find the most competitive deal that suits your needs. We can also help your business prioritise its sustainability goals, which will promote a greener future for your organisation while also saving money in the long run.  

With years of expertise under our belt, we are confident that we can reduce your business energy spending. Consultiv Utilities pride ourselves on working with our clients every step of the way, helping you find an energy contract that is both manageable and transparent.

Are you ready to improve your energy outlook? Get in touch with the team at Consultiv Utilities today.