Analysis: Britain is painfully vulnerable to volatile energy markets – the public’s patience is wearing thin
The possibility of a peace deal between Russia and Ukraine has caused wholesale energy bills to fall in recent weeks, but household bills will still be going up from April.
Consumers will be paying for the winter months. Europe endured a cold and still winter, meaning demand for energy increased while countries were less able to rely on wind power, so they had to draw down more heavily on their gas reserves.
European gas prices subsequently rose, hitting a two-year high of just over €58 per megawatt/hour earlier this month. That spike has fed into the latest price cap, which Ofgem sets quarterly.
The recent drop in the wholesale price could lead to lower prices come the summer. However, the latest increase – the third in a row – underscores just how vulnerable Britain is to volatility in the global energy markets and, in turn, how the government’s political ambitions…
