Energy retail increasingly challenging for smaller suppliers

The energy retail sector has once again been in the news with the big energy companies raising prices – British Gas announced an average 5.5% increase, followed by EDF with a more modest 1.4% rise. Both companies linked the price rises to increasing wholesale and policy costs, with Ofgem citing similar pressures when it raised…

Read More

The digitisation of energy: another dimension to the energy transition

When people speak about the “energy transition” they mean de-carbonisation and its associated changes, however another fundamental change in the market is taking place at the same time: the digitisation of energy. Technology is enabling more and more devices to be networked, allowing people different ways of controlling and managing both their environments and their…

Read More

E.On/RWE deal: re-shaping the energy industry

On 11 March, E.On announced it had reached agreement to acquire RWE’s 76.8% stake in Innogy SE through a share swap that would grant RWE a 16.67% share in E.On SE which would be issued by way of a 20% capital increase against a contribution in kind from existing authorised capital. E.On will also transfer…

Read More

Recent gas price spikes increase risks for small suppliers

After a few quiet years, the gas markets are going through some interesting times. Although the global supply glut continues, with tightening not expected until the 2020s, short-run supply and demand fluctuations are causing significant gas price spikes. According to Timera Energy, European gas demand (net of reverse flow) increased by 17 Bcm in 2017…

Read More

RIIO-2: Ofgem consults on tougher price controls for networks

Last week Ofgem has published its consultation for the next round of price controls for energy networks, known as RIIO-2. RIIO-1 had been strongly criticised for allowing network companies to generate above average levels of returns on businesses that are seen to be less risky than the wider economy. Network companies have been earning returns…

Read More

Political dispute in the Balkans causes electricity system frequency deviation across Europe

I have written several times about the challenges facing system operators as the energy transition sees increasing amounts of intermittent generation increasing frequency variation. However, between mid-January and early March, there was a persistent frequency deviation that caused clocks to lose time across the 25 countries connected to central Europe’s synchronous electricity system that had…

Read More

The rise of the corporate PPA

  Power Purchase Agreements (or “PPAs”) have been around for a long time, as agreements between market participants for the offtake of electricity from generating facilities. However, the past few years have seen the rise of the so-called “Corporate PPA” where companies whose business is not related to energy are procuring the electricity the use…

Read More

National Grid issues gas deficit warning as cold weather bites

As the UK shivers under attack from the “Beast from the East” – this morning National Grid issued a Gas Deficit Warning, indicating that the gas system was almost 48 million cubic metres (“mcm”) short relative to forecast demand. At 05:00, National Grid was expecting demand to reach 395 mcm for the day, with around…

Read More

Responding to the challenges of transmission system transformation

Last week, National Grid outlined its plans for it system operator business, following the decision by Ofgem last year that greater separation of this activity was needed from the rest of the National Grid business in order to better manage conflicts of interest. “Our long-term vision is for an Electricity System Operator (ESO) that thinks…

Read More