PwC comments on the updates to the energy price cap

Vicky Parker, Sector Leader for Power and Utilities at PwC UK, said:

“Today’s update to the price cap is good news for domestic consumers and households, who will benefit from a £238 reduction* in their annual energy spend when compared against the current price cap. Mild winter conditions coupled with relatively high storage levels have led to reduced pressure on spot prices - UK natural gas futures are down to near normal levels at c.55p/th - a third of the level they were in February 2023. 

“For non-domestic energy users and businesses, the focus should remain on long-term transformation. Energy prices have fallen to near-normal levels in part due to a milder winter and high storage levels. However, events over the last two years have shown how the energy system is acutely exposed to market volatility and geopolitical events. With PwC’s UK Energy Survey showing that 64% of businesses had seen their domestic competitiveness hampered by rising energy costs in the last two years, the obligation to insulate against price volatility and decarbonise in order to preserve and improve commercial performance will only become more urgent. Some organisations could be tempted to take advantage and act with milder weather reducing energy expenditure and relative price stability provided by markets.”

*For a dual fuel household with typical annual domestic consumption