Looking Back At 2022: A Year Of Uncertainty For The Energy Sector
Posted on Jan 3, 2023
Now we are settled into the new year, it may seem a little strange to look backwards rather than forward, but a year like 2022 can not be overlooked. Throwing many challenges our way, 2022 was a tumultuous year. The energy sector, in particular, battled the high waves of an energy crisis and a cost of living crisis, affecting energy providers, businesses and domestic consumers. Our review of 2022 gives a reflection of the year just gone, providing some insight into what impact this has had on energy consumption and prices. Afterall, sometimes you have to look back to lead forward.
The energy crisis
Following the invasion of Ukraine by Russian military forces back in February 2022, global gas supplies were impacted. This, and many other factors have led us to the point we are now. As the world recovered from the unexpected breakout of COVID-19, countries began facing shortages and increased prices for oil, gas and electricity, even back in 2021. This has placed us in a position where the price of oil hit its highest levels since the 2008 global financial crisis.
The higher wholesale prices have placed energy providers into the difficult situation of having to raise their prices for both domestic and non-domestic energy customers.
Ultimately, we have witnessed how the increasing energy prices have forced families into extremely vulnerable financial positions. Across Europe, in particular, the close ties to Russian gas supplies has created huge concern and discussion around the inevitable “cutting of ties” between major European countries and Russia, while homes and businesses are at risk of dealing with potential gas rationing and blackouts.
As we move into 2023, governments are looking to alternative energy sources to help relieve the incredible financial pressures this has placed on consumers and businesses over the last two years. We touched on this in another blog article several months ago, exploring the topic of Russian reliance.
Energy trends from July – September 2022
Key to helping understand the market and to forecast for the next year, are the facts and figures to come out of 2022. The UK government recently released a report discussing the energy trends from Q3 (July-September) of 2022. Here are some key points to come out of said report:
- Fuel imports from Russia continue to drop as the UK stopped importing any Russian LNG (liquified natural gas) from March 2022 onwards. While imports of Russian oil have dropped to 0.4% from 10.2% in 2021.
- Energy consumption actually increased in the third quarter of 2022. It was up 4.1% from the year before, mostly due to an increase in the consumption of transport fuels. However, it is worth noting that domestic consumption did the opposite. This can be put to a few factors, but the government have based their findings on the assumption that people were spending more time outside, following the end of Covid-19 restrictions. Although, it is important to bear in mind that rising energy prices will have also had an effect on consumption in this period.
- Qatar remains the largest source of LNG in the UK, accounting for over 50% of imports. The last cargo of LNG from Russia came in March 2022.
- The UK saw an 18% increase in renewable electricity generation in Q3 2022. Most of this increase was generated by wind generation, thanks to higher wind speeds and new offshore wind capacity.
- Solar PV electricity generation saw a record high in the UK in Q3 2022. This can be attributed to the longer, warmer summer we experienced last year.
Looking ahead into 2023
Upon reflection of the current energy crisis and the statistics produced by the government, it is clear that the energy sector is experiencing a shift. Both in production of electricity and gas but also changes in consumer behaviour. With renewables experiencing a positive upward trend, it wouldn’t be unreasonable to suggest that such sources of energy may be the desirable option for governments. Not only because capacity for the generation of renewables is increasing, but also because of the goals in place to reduce carbon emissions over the next few decades.
What is P272? P27what? You aren’t alone in the dark about P272. P272 is regarded as one of the biggest shakeups to the business electricity market since deregulation. Sounds more like a character out of star wars, but here are some facts on P272, which we have put together hopefully jargon free. If you unsure on how P272 affects your business please do not hesitate to contact us for free on 0800 781 7626, we will be delighted to help you further. You may also like to view our infographic and visit our support page dedicated to the P272 OFGEM legislation.
The Facts – What Is P272
P272 is a new regulation which has been implemented by OFGEM. It affects the way suppliers settle electricity consumption for businesses with a specified energy use. Resulting in sites being changed to half hourly.
Remember, remember the 5th November… “Guy Fawkes?”. No, no… this is when the P272 migration began! The deadline for all sites to be settled to Half-Hourly is 1st April 2017. Don’t be fooled by the date, it really is 1st April! Also, don’t be put off by the 2017 threat – it’ll be here before you know it!
The settlement is being put in place in order for suppliers to balance the amount of energy being purchased from the Generators. The aim for P272 is to make the readings more accurate via the half hourly consumption. This will provide distributors with more understanding on electricity use. This results in networks ensuring they are sufficiently developed and maintained.
Ultimately, P272 helps you and your business manage and also use the energy smartly. It gives you the opportunity to see where and when you are consuming energy. Also, a more accurate settlement which could lead to better tariff rates… something nobody would say no to, agreed?
Now you (hopefully) have a little more understanding of P272 here is how to prepare:
Learn if your portfolio is affected.
Speak to your supplier, they will be more than happy to explore your options with you.
Select your Half-Hourly Meter and Data Collector.
If your business has a maximum demand electricity supply categorised by profile classes:
05 06 07 08
And you have an Automated Meter Reading meter of which is capable of HH data collection and remote programming. Just to let you know… 160,000 sites are affected so it is definitely worth double, maybe even triple checking!
“How do I check?!” I hear you say? Simple… you just check the S number at the top of your electricity bill to find out your sites profile class.
Believe it or not, P272 can be very beneficial for you and here’s why:
You receive accurate billing
It offers you the ability to avoid peak times of electricity use
It gives you an insight on your energy usage
It allows you to make room for an opportunity of improvement and efficiency
This is an OFGEM regulation affecting ALL maximum demand meters and ALL electricity suppliers equally. If you’re being advised P272 does not affect your business, please let us double check this for you.
A Russian rocket blasted into space this month to investigate whether any methane gas is present on Mars, as part of the joint ExoMars project created by the European and Russian space agencies.
Methane is a gas created by living microbes, and if it were to be detected it would be a revelation in the space industry as it could prove that life exists or existed on the red planet, some 225 million kilometres away from the Earth (which is itself something of a shock, given that in 2003 Mars was a mere 56 million kms away).
We already know there is life-giving water on Mars. Just like the Earth it has ice caps, although the water they contain is more elusive. The American space agency NASA made a huge discovery in 2006 when it found there was water flowing through the planet in even the hottest months of the year, and that the ‘lines’ that appear on our satellite images of Mars are streaks of flowing salt water.
That’s when the questions ‘did life exist on Mars, and can we find out?’ really started to arise.
The ExoMars project involves sending up a Trace Gas Orbiter to sniff the Martian atmosphere for methane, and if the results are positive then this would establish that methane has been generated via geology or a biological process.
As part of the same mission, a stationary lander called Schiaparelli will test the technology for a subsequent mission – ExoMars 2018 – which will see a UK-built rover collect soil samples filled with water particles and drill below the planet’s surface to look for other signs of life. That’s when the search for Martian life will start in earnest.
These two projects combined will cost an eye-watering £900 million but isn’t it worth it for the chance to make one of the biggest discoveries of all time? What a time to be alive!
Planetary scientist Dr Peter Grindrod, from Birkbeck, University of London, who is funded by the UK Space Agency, certainly thinks so. “It’s incredibly exciting,” he enthused. “This is a series of missions that’s trying to address one of the fundamental questions in science: is there life anywhere else besides the Earth? Finding that life exists elsewhere in the solar system would be a huge discovery, so the evidence has to be strong. As they say, extraordinary claims require extraordinary evidence.”
Wouldn’t it be amazing to find out if there really is Life On Mars, or if there has been in the past. It’s astonishing to think there could be more than just us Earthlings in our solar system!