ICIS Power Index Q3 analysis shows market concern over UK generation amidst decline in wholesale power prices

03 October 2014

ICIS Power Index Q3 analysis shows market concern over UK generation amidst decline in wholesale power prices.

ICIS, the global independent price reporting agency, has highlighted wholesale market concerns over the threat of gas and power supply shortages this winter, with the release of its third quarter (Q3) analysis of 2014 into the ICIS Power Index (IPI).

The IPI, which reflects wholesale power prices over a year of delivery, confirms a downward trend, but also reveals a recent peak due to concerns over a potential shortage of supply . ICIS’ data and sources show this is a result of more nuclear generation capacity being offline for the winter than expected. The news that these outages could last into December 2014 caused the IPI to rise by 2.5per cent day on day, when the news was announced on the 4th September – one of the largest single increases this year.

At the same time, ongoing tension between Russia and Ukraine has caused concern over security of gas supplies. While Russia does not directly export gas to the UK, any disruptions to its supplies on continental Europe has a powerful knock-on effect on the UK market.

“Energy companies are actively buying and selling electricity in the market right now for delivery over the next year,” said Zoe Double, Head of Power at ICIS. “Any price rises on the wholesale market could affect what consumers pay later on.”

The IPI delivers insight into the complex world of wholesale power prices for both households and industrial electricity consumers. In its first comprehensive quarterly analysis following the launch in August 2014, the index has shown that the conflict in Ukraine exacerbated fears over reduced UK power generation.

The ICIS Power Index is updated every working day and is freely available from the ICIS website, along with ICIS’ analysis of price trends and volumes during Q3 2014.

Note to Editors

The ICIS Power Index enjoys strong support across the UK energy market:

  • Jeremy Nicholson, director of the Energy Intensive Users Group
    • “This is a meaningful index that will help consumers understand the costs their suppliers are passing on. It’s a positive move for transparency – the more information out there, the better.” 
  • Angela Knight, Chief Executive of Energy UK
    • “Energy UK, and its members has been very keen to see accurate, high-quality information readily and easily available so that everyone – not just energy insiders – can see what is going on in the electricity market. The ICIS Power Index is a great step forward in helping dispel myths about energy prices.”
  • Andrew Buckley, director-general, Major Energy Users Council
    • “Wholesale price movements are key information for our members, and the new ICIS Power Index will help bring clarity to what’s going on.” 
  • Nigel Cornwall, managing director, Cornwall Energy
    • “The IPI is a good idea – it’s the right way to show greater transparency on the wholesale market.” 
  • David Jutton, managing director, Jutton Associates
    • “The IPI is a useful and clear index for UK power. We’ve had a need for a similar number for a long time.”
About ICIS

ICIS is the world's largest petrochemical market information provider and has fast-growing energy and fertilizer divisions. Our aim is to give companies in global commodities markets a competitive advantage by delivering trusted pricing data, high-value news, analysis and independent consulting, enabling our customers to make better-informed trading and planning decisions. We have more than 30 years' experience in providing pricing information, news, analysis and consulting to buyers, sellers and analysts.

With a global staff of more than 800, ICIS has employees based in Houston, Washington, New York, London, Montpellier, Dusseldorf, Karlsruhe, Milan, Mumbai, Singapore, Guangzhou, Beijing, Shanghai, Yantai, Tokyo and Perth. Some 350 of ICIS’s staff are journalists engaged in reporting market prices and news, and ICIS is fully committed to upholding the highest journalistic principles of verification, corroboration and authentication. ICIS has a compliance framework that along with its methodologies and business processes adheres to the requirements of the IOSCO PRA Principles.

ICIS is a division of Reed Business Information, part of RELX Group.

About Reed Business Information

Reed Business InformationReed Business Information provides information and online data services to business professionals worldwide. Customers have access to our high-value industry data, analytics, information and tools. Our strong global brands hold market-leading positions across a wide range of industry sectors including banking, petrochemicals and aviation where we help customers make key strategic decisions every day. RBI is part of RELX Group plc, a world-leading provider of information solutions for professional customers across industries.

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