The security of economic electricity supplies is threatened by the demise of North Sea gas reserves and the growing concentration of world reserves in a limited number of areas. We need only look to recent wholesale price fluctuations and the enormous effect that these have had on businesses to recognise that a continuation of such events is unsustainable.
London (PRWEB) March 29, 2007
At a time when many businesses are still feeling the effects of rises in energy costs as high as 140% electricity4business, Britain's leading electricity supplier to small and mid-sized businesses, is concerned that despite a recent correction in wholesale energy rates due to improvements in short-term supply, the absence of a coherent and structured UK energy policy could deter generators from making the huge long-term investment decisions required to fill the energy gap. The energy shortage experienced last year was a wake up call exposing the government's inability to plan for Britain's change of status from a net exporter to a net importer of gas. Businesses must hope that current delays to the energy White Paper so crucial for long-term planning don't allow history to repeat itself with even more disastrous effects.
As a company with a mission to offer the cheapest rates possible to business, electricity4business is disheartened by the Government's lack of progress on energy policy and in particular by the still further delay caused as a result of the Government's failure to consult on both the economics of building new nuclear plants and the disposal of waste.
Graham Paul, sales and marketing director at E4B, making no attempt to hide his frustration at the delay, said, "The security of economic electricity supplies is threatened by the demise of North Sea gas reserves and the growing concentration of world reserves in a limited number of areas. We need only look to recent wholesale price fluctuations and the enormous effect that these have had on businesses to recognise that a continuation of such events is unsustainable."
And Paul has real reason to feel frustrated given the predictions of a report by Logica CMG in late November 2006 which claims that the UK Energy Gap is "much larger, much closer and more expensive" than has previously been reported.
The report claims that:
- By 2015 the energy demand in the UK could exceed supply by 23% at peak times
- The impact of the 'real' energy gap on GDP will be equivalent to £108 billion a year
- That's £3700 a year cost for every working adult in the country
- Power cuts are now just as likely in the summer as in the winter given the rising demand for air-conditioning
- By 2025 energy demand in the UK may exceed the available supply by 30%
The report further states that 'The Government will have to take steps to resolve this issue. If this doesn't happen, it is almost certain that the power will go off and business will lose money.'
The picture gets even gloomier for SMEs who could lose an average of £300,000 a year based on just one outage day per week.
Such an outcome would be a bitter pill to swallow for electricity4business whose whole raison d'être is to alleviate the burden of high energy costs on SMEs.
Whatever the additional input required by the Government as a result of the recent judgment, it is imperative that it moves with the utmost haste and clarifies its energy policy without delay. Only then will generators be able to plan for the huge investment in whichever energy portfolio is required. Any further hesitation by the Government will be interpreted negatively by the markets and it is likely that the adverse experiences of last year will become a regular occurrence with outages an every day event in the UK.
Notes for Editor:
Electricity 4 Business Ltd
Electricity4business provides an alternative to the big 6 by providing cheap business electricity for small and medium sized businesses spending less than £100,000 per annum on their electricity supply.
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