How CCL charges have changed

March Review By Adam Novakovic, Energy Markets Consultant After 4 months of falling energy prices, March broke the downtrend and saw a bounce in the wholesale and seasonal markets. Electricity prices for the Winter of 2024 rose by approximately 7%, as 2025 seasons increased by over 10%. So, what caused these rises? After a milder than anticipated February, temperatures were below expectation at the beginning of March leading to increased consumption. Around this time LNG imports from the Middle East were being disrupted by on-going conflicts, and the Freeport LNG facility in the US remained offline, reducing the potential for further imports crossing the Atlantic. Closer to home, MPs were announcing plans to reform the electricity market with an emphasis being put on locational pricing. These changes – which are part of the Review of Electricity Market Arrangements – could potentially lead to £35 billion in savings over the next 20 years, although the plans are still in their early stages. A more advanced project that was launched in March, and could potentially lower energy costs, was the new balancing reserve service. In recent years, Use of System charges have been increasing and this measure is seen as a key step in countering these rising costs. The new system will work by procuring reserve energy in advance instead of using on-the-day methods. This is anticipated to lead to over £600 million in savings over the coming years. One of the main disappointments from March’s budget announcements was the lack of a replacement for the Energy Bills Discount Scheme (EBDS). The EBDS had offered vital support to many businesses in the UK throughout the recent period of volatile energy prices. However, the scheme concluded at the end of March, with no replacement scheme being offered. Coinciding with the end of the scheme, OFGEM published a survey revealing that almost 60% of UK businesses are concerned about the impact of energy prices. While IPSOS revealed almost 2/3 rds of businesses are unaware of existing government schemes that could benefit them. If your business is currently looking for a way to reduce energy costs, then contact us to see how we can help reduce your energy spend. And if you would like to read more about government schemes that could help your business, check out the SeeMore energy website where we have a section dedicated to explaining various energy schemes . Outlook Despite the rising prices seen over the past month, fundamentally there are a lot of positives for the future of gas and electricity prices. UK storage facilities remain around 60% full, approximately 20% higher than levels seen for the majority of the last decade. Renewable production is at an all-time high, and there is a steady flow of LNG shipments arriving -- in addition to the supply received from Norwegian pipelines. In spite of this, some fears remain and there are potential negative catalysts that could lead to prices rising further, with the main factors to watch out for being based on geopolitical unrest. Throughout March we saw an increase in the targeting of infrastructure in the conflict between Russia and Ukraine. And, despite an increased US military presence, attacks on cargo ships are still occurring in the Middle East which could have a direct impact on LNG imports from Qatar. Without any further negative catalysts or disruptions to supply, it seems most likely prices will steadily start to fall again over the coming quarter, but it will be prudent to keep monitoring developments in the on-going conflicts. If your business requires advice with its energy procurement, management, or planning, then don’t hesitate to contact Seemore Energy to speak to experienced advisors who can help you with bespoke strategies and advice that is tailored to your needs.

Understanding Meter Reads and Avoiding Estimated Bills In today's world of rising energy costs, keeping a close eye on your household bills is more important than ever. One way to ensure you're paying for the exact amount of energy you use is by understanding meter reads. What is a Meter Read? A meter read is simply the recorded measurement of your energy consumption, typically electricity or gas. This measurement is taken by a representative from your energy supplier or captured electronically by a smart meter. Traditional meters have dials with numbers that rotate as you use energy, while smart meters display the reading digitally.  Taking a Meter Read Yourself While many suppliers now rely on smart meters for automatic readings, some households might still have traditional meters. There are various types of meters, and how to take the read can vary between them. We have published a free guide for how to take meter reads covering various meter types. If you would like a copy of this guide, leave your email address in the form at the bottom of this page and we will send you a free copy.

Understanding KVA Capacity Charges and How to Save Money KVA capacity charges are a vital, yet often confusing, aspect of your electricity bill. This article explains what they are, how they are used, and how you can potentially reduce them. What are KVA Capacity Charges? Imagine your electricity supply like a motorway. KVA (Kilo Volt Amperes) represent the width of the lane allocated to your business. This reserved space ensures you have enough power to meet your peak demands, whenever needed. These charges reflect the cost of maintaining this dedicated capacity on the grid, even if you don't use it all of the time. They are set by your local Distribution Network Operator (DNO) and are billed separately on your electricity invoice. Example: A manufacturing plant has a high-power demand during operation. The DNO allocates a capacity of 50 KVA to ensure the plant has sufficient power readily available. This translates to a daily charge (based on the current rate) of: 3.18 pence/kVA * 50 kVA * 1 day = £1.59 Reducing KVA Capacity Charges Here's the good news: You can potentially lower your KVA charges by optimising your power usage: Monitor your consumption: Analyse your meter readings to identify periods of high energy use (or use an electricity footprint report, like those which are available through our online portal). Spread the load: Try to distribute high-power activities throughout the day, instead of concentrating them in short bursts. Shift tasks: Schedule non-critical tasks for off-peak hours when there's less demand on the grid. Upgrade equipment: Consider investing in energy-efficient equipment that consumes less power. Lowering your KVA Allowance By contacting your DNO, you can formally request a reduction in your allocated KVA capacity. This essentially reduces the width of your reserved lane on the grid. Reduction process: This is a free service as it doesn't involve physical changes to the network. Important consideration: Be mindful that future capacity increases might incur charges as the initially reduced capacity might have been allocated to others. Key Takeaway KVA capacity charges ensure you have reliable access to the power you need. However, by understanding your consumption patterns and implementing strategic changes, you can potentially reduce these charges and save money on your electricity bill. Additional Notes: Capacity charges might be represented as "DUoS" (Distribution Use of System) on your bill. Your DNO can help assess your meter readings to determine if a capacity reduction is suitable for your business. By implementing these strategies, you can gain better control over your KVA capacity and potentially achieve significant cost savings on your electricity bill. If you would like your KVA charges reviewed to see if you can reduce your capacity charges, contact us today . We can conduct a free review to see if you’re a suitable candidate for reduced capacity charges.

Understanding ESOS Phase 3: Key Requirements for Businesses

Who is Eligible for the Industrial Energy Transformation Fund (IETF)? The IETF is for businesses in the UK with high energy usage who are looking to cut their energy consumption and reduce their carbon emissions. There are a few key things to determine eligibility: • Industry : Your company must be in an eligible industry, such as mining and quarrying, manufacturing, recovery and recycling of materials, or data centres. Some new sectors are included in Phase 3, such as controlled environment horticulture activities, industrial laundries, and textile renting facilities. Coal mining is no longer eligible. • Location : Your industrial site must be located in England, Wales, or Northern Ireland. If your company is registered in Scotland but your site is elsewhere in the UK, you can still apply. Businesses in Scotland should look into the Scottish Industrial Energy Transformation Fund. • Project Type: Your project should focus on cutting industrial energy use. The IETF offers funding for: o Feasibility and Engineering Studies: These studies help assess the viability of potential solutions. o Energy Efficiency Deployment: This involves implementing technologies that reduce energy consumption within your industrial processes. o Deep Decarbonisation Deployment: This focuses on technologies that significantly reduce carbon emissions from your industrial processes.

By Adam Novakovic, Energy Markets Consultant In what proved to be the wettest February in 258 years, we saw energy prices continue their downward trend. Electricity prices for the upcoming summer season fell approximately 20% in the first 3 weeks of the month before ending the month with a small rally in a pattern mirrored by the gas prices.

The EII (Energy Intensive industry) levy exemption scheme is set to change over the next year. It’s changes are designed to save eligible businesses money from their non-commodity charges and keep them competitive internationally. In this article we will analyse how the changes translate into concrete savings, when they take place, and proposed future changes. Changes to current discount rates Currently the scheme offers businesses operating within eligible industries discounts on non-commodity costs. At the moment, the scheme offers an 85% discount on Renewable Obligations (RO), Feed-in Tariffs (FiT), and Contracts for Difference (CfD). This is due to change on April 1 st , with the discounted rate increasing from 85% to 100%. With the current 85% discount, it is estimated that these savings equal approximately 3.5p/kWh consumed. Capacity Market changes In October 2024 Capacity Market charges are set to be added to the exemption. This will add a further discount of approximately 2.8p/kWh to the non-commodity charges paid per unit of electricity consumed. DUoS charges Reviews are currently taking place looking at the viability of including DUoS (Distribution Use of System) charges within the exemption scheme, with a view of adding them to the list of exempt charges in 2025. If these are included this could lead to the total discount being worth approximately 9p/kWh.

January Review by Adam Novakovic, Energy Markets Consultant - As many were nursing new year hangovers and endeavouring to stick to their freshly made resolutions, the UK gas and electricity markets began January 2024 by staying around similar levels to those seen at the end of 2023. However, after the first week of the year prices began to fall with futures markets seeing electricity costs fall over 5% as the 2 nd week of the year began, and then continue to fall throughout the week. As the month progressed, electricity prices for Summer’24 were almost 25% lower than the levels seen in December 2023. As prices continue to fall, we increasingly see these reductions in price being passed on to those looking to negotiate fixed contracts in the coming months. A large reason for these falling prices were the steady supplies being received from Norwegian pipelines and LNG imports. These inflows combined with a milder than anticipated winter led to gas storage levels remaining high and the dissipation of any remaining fears about shortages. Despite this positive news regarding falling prices there remained concerns about how the UK has seen energy prices rise disproportionately when compared to other countries over the last 5 years. The International Energy Agency found that since 2019 energy prices in the UK have risen at a faster rate than most other developed countries. This puts a particular strain on Energy Intensive Industries, although these numbers don’t account for UK government schemes aimed at allowing such industries to remain competitive internationally. It's not just energy intensive industries that have been impacted by energy prices. A report by Simply Asset Finance found that almost 20% of SMEs have had to downsize and cut costs as a result of increased energy prices. They also found that 57% of SMEs were unaware of financial support or government schemes that were designed to help them. If you would like to find out if your business is entitled to any governmental schemes that can help reduce your energy spend then contact us today . We can help with the process of applying for any schemes you may be eligible for without charge. In addition to seeing usage charges increase over the past few years, standing charges have also increased significantly. This month the standing charge became a much-discussed topic, with OFGEM receiving recommendations to change the way Standing Charges are offered to customers, as well as a group of MPs initiating a petition for the abolition of standing charges. As the year progresses, we will likely see OFGEM put more pressure on suppliers to change the way standing charges are being applied. While prices dropped throughout the month, there were still some concerns that threatened to send prices higher. Conflict in the Red Sea saw many shipping routes diverted. Many cargos that would normally pass through the Suez Canal were forced to take the longer route around the Cape of Good Hope. This has yet to have a significant impact on price but will need to be monitored as the UK is reliant upon LNG imports from Qatar. A further threat to LNG imports came from the US where the government has paused approvals on expanding LNG exports. Last year the US became the world’s number 1 exporter of LNG. While this isn’t expected to have any immediate impact on European energy prices, there could be mid-to-long-term effects that drive up prices from other LNG exporters. Outlook As we look ahead to how energy prices will move in the coming months, we can see a number of factors that have the potential to disrupt the current downtrend. Should the conflict in the Red Sea escalate, or should shipping be further disrupted, this could negatively impact energy prices. The fact that shortfalls in supply from the Middle East currently can’t be made up by importing from the US make this a greater concern than when news of the conflicts were first reported. Throughout this winter, weather has been a significant narrative in the direction of energy prices. While the temperature so far has been (mostly) milder than expected, forecasts for the 2 nd half of February are suggesting it could be colder than originally anticipated. Given the healthy gas storage levels in the UK, this shouldn’t have too large of an impact, but it could become a factor if supply is disrupted. Looking further ahead, there was positive news in the UK as plans for the Sizewell C nuclear reactor advanced. Construction is now set to proceed for the reactor that will add to the UK’s capacity in a reliable and environmentally friendly manner. Should we avoid any of the potential disruptions to supply in February it seems plausible that prices could continue to drop. For the short-term we would urge some caution in the energy markets as prices are at their lowest levels in some time. Looking beyond the current months, it seems reasonable to assume that prices will continue their current downtrend, although there may be a speedbump or two along the way. If your business requires advice with its energy procurement, management, or planning, then don’t hesitate to contact Seemore Energy to speak to experienced advisors who can help you with bespoke strategies and advice that is tailored to your needs.