Why have energy prices risen?

What are the reasons behind the increasing energy prices?

By Sophie Wyatt

 2nd August 2022

As the world continues to make sustainability a priority, waste is becoming an urgent issue. Unnecessary waste, including emissions, has had a disastrous impact on the Earth. UK housing now accounts for more than 40% of the country’s carbon emissions. So, it is clear that we need to make drastic changes within this sector, if we want to save our planet.

Tenants have been left confused about why their bills are rising so high, forcing some to the edge of fuel poverty. And with prices continuing to rise at a rapid rate, they are desperate to get answers.

So, why have energy prices risen so rapidly? And how can you protect yourself from sky-rocketing costs?

The reasons behind it

The energy market has been incredibly volatile over recent years, to say the least. With fluctuating prices reaching all-time highs, countries, businesses and tenants have been left wondering why this is happening, and what to do next. To put it in context, wholesale gas prices have increased by 250% since January 2021. The situation has worsened further in 2022, as a result of significant geopolitical developments.

Here are some of the reasons why energy is more expensive:

  • There was a colder winter across Europe in 2020. This put pressure on global supplies and gas levels – making storage considerably lower than normal.
  • As gas prices increased, coal became more profitable for power generators in Europe. As a result, these emitters have increased their demand for emission allowances, pushing up the price of carbon.
  • Energy prices also reached record highs, due to a rise in oil prices following Russia’s invasion of Ukraine in February 2022.

What has prompted these high peaks?

High demand for gas and electricity, along with a reduced supply, has caused the soaring wholesale prices. Recent peaks have even exceeded 2008 levels, when the recession was in full swing. With the war between Russia and Ukraine continuing, countries around the world have been forced to prepare for change. There has been significant turbulence in the global energy markets as a result of the invasion.

These events have added further pressure to an already tight natural gas and energy market. And have forced individuals around the UK into fuel poverty.

What can tenants do?

1 Update your boiler and heating controls

Old boilers cost much more to run than newer ones. So, replacing yours could be good for the environment, and cost-effective.

2 Set your heating and hot-water timer

If you’re out at work for most of the day, set the timer to come on for a few hours in the morning and evening, while you’re at home.

3 Set the boiler thermostat to 60°C (140°F)

This is warm enough to provide hot water and heating for your home, and means that you don’t need to waste money by heating more than this.

4 Move furniture away from radiators

Valuable heat is absorbed by furniture in front of radiators, making rooms feeling colder.

5 Use your curtains

Draw your curtains when it starts to go dark, and hang a curtain across your front and back doors to keep the draught out. Lined or thick curtains are best.

6 Use thermostatic radiator valves

You can control the heating in your house by using a thermostatic radiator valve. This adjusts the flow of water into your radiator, depending on the setting.

7 Turn the central heating thermostat down

Zoning the heat in your house or flat means you can keep certain rooms warm while not wasting heat elsewhere.

8 Turn the radiator temperature down

Or completely off in rooms you rarely use, to reduce the total amount of energy you use.

9 Tint your windows

Window films are designed to allow in visible light, while blocking infrared light. And in turn, keeps more heat in.

10 Top up extra money

If you are on a prepayment meter, add more money where you can in the summer to build up credit for the colder winter months.

How can we help?

At Welcome Energy, we offer advice and guidance on a range of energy saving solutions, helping to improve your energy efficiency as well as offering AMR solutions tailored to your requirements.

We are on hand to offer our clients a stress-free, affordable range of services. Our team brings together over 30 years of experience in the billing of communal and district heat networks, to help our clients reach a more comfortable and affordable future.

Get in touch today, and find out how we can help you to become more sustainable.