Understand UK Energy Market Trends in 2024

24

May 2024
Understanding UK Energy Trends in 2024

Understand UK Energy Market Trends in 2024

Powering Your Home: Understanding the Ever-Changing UK Energy Market 

As we journey through 2024, the landscape of the UK energy market continues to undergo significant shifts, impacting homeowners across the nation. Let’s understand what it means for you and your wallet. 

According to Ofgem, average domestic energy bills in 2023 increased by 12% compared to 2022. The average electricity bill rose by 10%, while the average gas bill increased by 15%. 

What Affects Your Electricity and Gas Costs 

Electricity prices are closely linked to gas prices due to the use of gas-fired power stations. While gas prices have been volatile, power prices in 2024 have remained similar to those in 2021. This stability is due to the steady increase in renewable energy, especially wind energy. The new 1.4GW Viking Link, connecting Great Britain to Denmark, has boosted alternative power sources, reducing wholesale electricity prices. Additionally, more nuclear generation in France has helped lower prices. 

The loss of Russian gas supplies after its invasion of Ukraine has affected Europe, leading to a reliance on global markets for gas. Despite spikes in gas prices from geopolitical tensions, such as the conflict in Israel, the winter of 2023/24 was milder than expected. This kept gas demand low and storage levels high, gradually lowering gas prices. 

Energy Price Cap: What It Means for You 

To protect consumers from market fluctuations, Ofgem enforces the energy price cap. From 1st July to 30th September 2024, the energy price for a typical household using both electricity and gas and paying by Direct Debit decreased to £1,568 per year. This is a £122 reduction from the previous cap set from 1st April to 30th June, which was £1,690 per year. These measures ensure consumers have fair and affordable energy prices. 

Help if You Need It 

If you are a homeowner struggling to pay your energy bills, there is a network of support waiting to lend a helping hand. Here is a look at some of the support available to you: 

Negotiating Payment Plans: Contact your energy supplier if you are having trouble paying bills. They are required to work with you to create a payment plan based on your financial situation. This might include reviewing current payments, arranging payment breaks or reductions, or extending the repayment period.

Government Assistance: The UK Government has various schemes and grants to assist households in managing energy costs. Available support includes the Winter Fuel Payment, Cold Weather Payment, and Warm Home Discount, each designed to provide financial relief during challenging periods. Additionally, the Fuel Direct Scheme provides a structured approach to settling any outstanding bills you may have. 

Priority Service Registers: Joining your energy supplier's Priority Service Register ensures that you receive additional support when needed, whether due to ongoing or temporary circumstances. This could include priority assistance during service disruptions, tailored communication methods, and access to specialised services tailored to your needs. 

Supplier Schemes and Grants: Many energy suppliers offer their own assistance schemes and grants aimed at helping customers manage energy costs, clear debts, or make energy-efficient improvements to their homes. Contact your supplier to inquire about available programs and eligibility criteria. 

Charitable Support: Charitable organisations, like Citizens Advice, extend support to homeowners struggling with energy bills. They provide guidance, advocacy, and access to financial assistance programs, ensuring that no one faces energy-related challenges alone. 

Are you paying too much for your energy? See if you can get a better energy deal and save money.