GMG ENERGY CLUB - APRIL MARKET REPORT

The past month has been a very testing and worrying time for all involved in the energy market, from customers’ rising costs to spikes in wholesale prices.

At the end of February all suppliers pulled their prices as we saw the energy market more than quadruple overnight, due to the war in Ukraine. There are lots of questions that have been raised by golf clubs… When will the market come down? What is the best contract length? Is the government going to assist?

At GMG we are here to answer any of these questions. Looking at the EU’s commitment to come away from using Russian gas by 2027, and their current 40-50% reliance on this, prices from other gas producers have increased. The effects of the war in Ukraine is going to have a long lasting impact on the energy market. With high wholesale prices due to the demand from an (almost) worldwide market putting sanctions on Russia. Unfortunately the UK produces 40% of its electricity via gas power stations, therefore increasing the price of electricity further. 

We are recommending golf clubs commit to longer term contract, usually 2-3 years, to spread the increased costs over a longer term. Unfortunately at this stage, it doesn’t look like the government are going to step in on the business side of the market, they have taken steps to help the domestic user but at this stage this seems to be it.

We have a lot of golf clubs who are currently supplied by Gazprom asking questions. The current advise is to stay put, coming out of contracts is very expensive and with the current energy prices the cost for a new contract will be much higher. However we will keep clubs updated with any progress, we know that there have been options of manager buyouts and government running discussed.

In the past few weeks suppliers have started pricing again, with a bit more stability being seen on the wholesale market. With the potential continuing increases on the energy market, we recommend any club with a contract coming to an end in the next 12 months to get in touch. We will assess the current market on your behalf, and advise on the best steps.

We have also seen a big increase in enquiries to do with energy reduction methods. Many clubs have shown a strong interest in Solar installations, with rising energy costs the pay back time on installs is much less. If you are interested in a Solar install then please email an electricity invoice to [email protected] for a free quote.