BEIS energy prices update

BEIS energy prices update
William Nye, Energy Prices Statistician from the Department for Business, Energy and Industrial Strategy (BEIS) outlines the main highlights and a view of the changes between Q1 2020 and Q1 2021 for the non-domestic1 sector.

Key points for businesses
  • Electricity: average price rises year-on-year, except for Large and Very Large band2
  • Gas: average price falls year-on-year, except for Very Large band – where average gas prices rise
  • Industrial sector: gas and electricity prices both decrease year-on-year
  • Manufacturing sector: year-on-year figures show overall increase in electricity prices and a slight increase in gas prices

Electricity key trends
Between Q1 2020 and Q1 2021, the average electricity price in cash terms3 rose by 2.5% to 14.0 pence per kWh. 
Price rises were seen in all Consumer Bands apart from the Large and Very Large bands. It’s important to note, the Very Large and Extra Large bands are subject to greater change over time as they are based on fewer consumers.

Since Q2 2011, and despite the recent falls, average electricity prices4 have been on a general upward trend.

Elec data

Gas key trends
Between Q1 2020 and Q1 2021, the average gas price in cash terms fell by 5.5% to 2.3 pence per kWh. Prices falls were seen in all Consumer Bands apart from the Very Large.

Since 2018, there has been a slow general trend for average gas prices to fall when factoring in seasonal variation.

Gas data

A focus on energy prices in the manufacturing sector
The five-year trend (2015 to 2020) shows increase in electricity prices, with a decrease in gas prices - although there are differences across the size of business:

Data for 2020 shows that over the past five years the average price has risen by 22% in cash terms.

Comparing Q1 2021 with Q1 2020, the average price paid by electricity consumers, increased by 7.3%. There has been an increase across all Consumer Bands.

Data for 2020 shows that over the past five years, the average gas price has decreased by 25% in cash terms.

Compared to the previous year, in Q1 2021, the average price for gas consumers, increased by 1.3%. Over the same period, prices for Small and Medium bands have decreased whilst Large bands have seen an increase.
Compared to the previous year, heavy fuel oil consumers in the manufacturing industry in Q1 2021 have seen an average rice fall of 3.6% in cash terms.

Chart 3.41 BEIS’s data on the ‘Non-Domestic’ population essentially includes users of energy other than households. But we also present some specific populations including industrial users (that are specifically those with SIC codes that cover “industry” and exclude those in the Transport, Retail, Services and Commercial sectors) and manufacturing which is a subset of industry that use fuels in the manufacturing process and include companies that produce by-products of the fuels.
2 Non-domestic data is collected and presented by approximate size band of annual consumption of non-domestic consumers
3 Real and current (cash) refers to whether they’re inflation adjusted (real) or not (current) - this view also excludes CCL
4 Includes CCL

Source: Quarterly Energy Prices: June 2021

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