Tensions across the Middle East continue as Iran, the US, and the UN fail to agree on Tehran's nuclear programme - claimed to be for energy purposes only - and threats to close the Strait of Hormuz, although still open for business at present to all seafaring traffic a lengthy disruption could result in an upward spike in oil prices.  Although confidence is high that no action will be taken by either side for the immediate future; the outlook remains uncertain. Forward markets are still steady and reflect some of the best future prices for years, but experience has taught us that even small global events can cause large ripples in the markets. Certainly the news that the UK is currently in debt to the tune of £1 trillion will do nothing to maintain market confidence.

In more positive news; prominent champions of green energy, Ecotricity, have snapped up the rights to add hydro electric generation to its already enviable portfolio of renewable-only energy, which is currently harnessed from Solar and Wind power.  Investing in newly pioneered technology - the 'Searaser' is a project able to generate some 500MW of renewable electricity, enough to power almost a quarter of a million homes. Using a simple technique of a pump-like device powered by the swell of the tide to deliver pressurised seawater to on-shore generators, the green light has been given to install some 200 units in the waters around the UK within five years. The costs of generation by Searasers are tiny when compared to complex off-shore generators, which are also prone to corrosion and costly to install.

The catalyst for this decision can be put down in part to the cutting of financial guarantees required by the Government from hydro energy developers by 80%, from £25m to £5m; creating a more realistic prospect for hydro installations to turn a profit. This massive reduction in fees is a welcome, but rather curious decision by the coalition, and is flying directly in the face of the huge cuts to FiTs (feed in tariffs) - currently being contested in the High Court - announced at the end of 2011.

We hope to be able to report more positive news regarding this exciting new incentive, and on a swift resolution to the Iranian conflict, but in the meantime, get in touch with by clicking here to find out how we can help you reduce bottom-line business energy costs - everything from procurement and invoice validation, right up to complex tenant billing and in-depth site surveys; you're sure to find our Utility Consultancy services invaluable, and extremely flexible.

Steadying prices this week is the news that capacity is currently exceeding demand in the UK, with coal-fired generation at the forefront of output and reaching almost 50% of total UK power generation following a long-term average of about 44% of total UK power, and news that the UK-France interconnector has been exporting this week for the first time this year following consistent imports. Although the cold weather is expected to continue for another ten days or so, outside temperatures have so far been slightly above the January average which points to a positive outlook.

Still just newspaper talk at the moment - as evidenced by no new revelations at the start of this week - the touted hostile closure of the Strait of Hormuz is still a hot topic. In the unlikely event of Iran carrying out the threat, and disrupting middle-Eastern deliveries - most notably from Qatar - not only would the exports of Brent crude oil be affected, but so too would the circa 77 million tonnes of liquefied natural gas (LNG) per annum which is transported through the Strait of Hormuz from Qatar to destinations worldwide. This equates to approximately 30% of the global LNG market.  Qatar is the majority provider of LNG to the UK - 85% of our imports during 2011 coming from there - and the UK was the biggest recipient of Qatari LNG in 2011, followed by Japan with 11.7 million tonnes (compared to the UK's 16 million tonnes).  Worth considering is that Japan is expected to increase imports to some 80 million tonnes in 2012 in order to  continue their economic recovery following the tsunami of last year and the loss of vast amounts of nuclear power (38% of total capacity).

Any temporary closure to the Strait isn't likely to have a massive impact on markets, as many traders and brokers of LNG believe the threats to close the chokepoint are empty, largely owing to Iran's economy which is heavily reliant on crude oil exports, and that the US Navy (at least) would intervene to ensure as little disruption as possible occurs, and the markets have acted according to these beliefs with prices holding steady and even following a long-term gradual slide in prices. Supply capacity across the UK is currently very healthy so no knee-jerk reactions in the markets are expected.

Clifford Talbot Partnership are of course constantly monitoring the markets for our Utility Bureau Service and Procurement clients and are advising on best steps when it comes to all aspects of Energy Management; everything from Bill Validation to Tenant Billing, as well as all procurement needs and dozens of additional services. Speak to our Utility Consultants and hear just how we can save you time and money when dealing with your utility needs.

The wholesale price of Brent crude oil has seen further increases over the past few days with intra-day prices fluctuating wildly and an overall increase during the festive period (19/12/11-03/01/12) of $7/barrel. The volatility of the daily markets cannot be ignored, but as it stands, there is still an ongoing downward trend and if recent behaviour is followed we could see a drop over the next week.

On the plus side, the US, China and India among others have noticeably increased oil demand as economic fears are lessened and production begins to climb again, but there are new fears over tension in the Middle East. Following a recent Iranian missile test and subsequent EU and US sanctions, Iran has threatened to close the Strait of Hormuz, which, like the Suez Canal is a major route for global oil exports - up to 20% (17m barrels per annum) of the world's total traded oil is exported this way and any blockage, even temporary, could lead to substantial increase in energy costs.

As a kind of silver lining to this cloud though, increases in oil costs may damage the global economy, resulting in reduced demand and leading to falling prices. Not an ideal situation in anyone's books, but the sort of see-saw effect that 'balances' the economy.

As always, we will be closely monitoring the markets and will be best advising our clients on future tenders as we look to secure best  prices through our energy procurement and utility management experts - contact us now if you're not already reaping the benefits of our expert Utility Consultants

There is no doubt that 2011 was an eventful year, not least of all in the energy market, and the wholesale prices reacted accordingly, but not always in the way you might expect.

The start of February saw the Egyptian revolution with the then President Hosni Mubarak resigning after a peoples revolt which saw violence and demonstrations across the country. As a significant producer of oil, it was predicted that this would lead to an embargo on oil exports whilst a new government was put in place, and then; what if said government made wholesale changes to the entire oil export policy? It was these fears that saw a push on the market prices, rising by an average of 8% over the month.

Much like in Egypt, the Civil War in Libya during 2011 caused ripples in the market - although one of the top 20 major oil exporters, the duration of this unrest, culminating in the death of Muammar Gaddafi in October, covered almost the entire year, so the exact market effects are impossible to pin-point.

On the 11th March 2011, the Japanese Tsunami struck. This natural disaster cost more than 18,000 lives and destroyed over 200,000 homes. As well as the humanitarian disaster, the subsequent near meltdown of the Fukushima power plant raised global fears not only of the expelled radioactive material - something that is still ongoing with final repercussions not yet identified - but also the very fact that Japan was heavily reliant on nuclear power (almost 30% of total generation). As the country pulled nuclear power stations from the grid, they had to switch to other sources to meet (admittedly diminished) demand. The first port of call was Liquefied Natural Gas (LNG); with diversions being made from many countries to allow Japan to fulfil demand in a time of serious need. Naturally, the extra competition for this LNG caused prices to increase again, with a knee-jerk reaction increase of some 5% in the following fortnight. In reaction to the near meltdown of Fukushima, Germany pulled 20% of their nuclear fleet offline with immediate effect. This too added strain as their energy imports increased to cover this shortfall.

At the start of May the long-time number one Most Wanted Man, Osama Bin Laden, was killed following a US led storm in Pakistan. Again, further uncertainty followed with speculation that Pakistan had been harbouring Bin Laden, leading to stressed relationships across the globe. Although Pakistan itself is not a major producer of oil, political tensions often impact markets. In this case the impact was favourable, and the following fortnight saw a continued averaged drop of almost 8% in wholesale prices. A nice plateau followed, even during the atrocious rioting at the start of August in London, Birmingham, Liverpool and, to lesser extents, several other cities across the UK.

Several new electricity generators were announced during 2011, with energy coming from everything from bio-mass to nuclear, and a forecast mild winter added to confidence in the grid coping with demand during this period.

November saw the government make a U-turn on their policy to increase renewable power, by cutting the dividends paid for FiTs (Feed in Tariffs) by half and drastically reducing the incentive for domestic and commercial users to install solar panels to their properties, generating renewable power to be returned to the grid, and to fulfil their own power needs. Speculation arose that the Big Six energy suppliers may have had a hand in this cut, but who can say for sure...?

More recently, a new treaty has been agreed to take over from where the Kyoto Protocol leaves off in 2015 - the positive action should see changes in the entire industry as the UK look to move towards a low-carbon future, but as this is a long-term plan we don't expect any drastic market impacts for the time being. Shale gas generation also built up a head of speed this year, but is yet to be widely adopted in the UK owing to environmental concerns.

And all the while, we've had the Eurozone Crisis to deal with!

As a company, we at Clifford Talbot Partnership have enjoyed another busy year, solidifying existing long-term business relationships, and welcoming many new clients to our services with whom we hope to enjoy equally long relationships. The work we've carried out for our clients not only sees them reaping the rewards in time and money saved, but also helps re-establish our position as one of the leading Utility Consultants in the UK. This is a label we're very proud of, and in an effort to stay ahead of the game 2011 several new members of staff were appointed to our already highly qualified and experienced teams in order to offer the best possible service to our clients, both present and future.

As we anticipate another eventful, interesting and challenging year ahead in the energy markets, may we wish you all a very Merry Christmas and a Happy New Year.

The UN climate change treaty negotiations in South Africa have ended and have seen an agreement to begin work on a new universal treaty by 2015. Following the Kyoto Protocol's disappointing results - the targets of a maximum global temperature rise of 2C by cutting greenhouse gases by 2012 are looking less and less likely - a rethink was required. Although no actual plan has yet been set out, merely this time frame, the agreement is a significant step to tackling emissions and climate change. All 193 states involved have agreed for the first time that action needs to be taken. In the past, many of the biggest industrial users such as the USA and China, have refused to enter into such agreements without other large users first committing, resulting in a catch 22 situation. Although a long-term plan, this is of course something we'll be keenly watching and reporting on.

The treaty will not be in place to solely increase renewable energy but it can be expected to play a large part. Moving to solar power may seem like small fry when compared to the massive average output of a typical coal or gas-fired generator, but it has previously been touted that in just six hours, the world's deserts receive more energy from the sun than humans consume in an entire year. There is of course no suggestion that solar panels should be installed the length and breadth of the Sahara, but even if a tiny fraction of this energy could be harnessed – an area the size of Wales could in theory power the whole of Europe. A largely German-led programme (including contributions from Eon Energy, Siemens, HSBC and Deutsche Bank among others) estimated to cost some €400m is underway to source some 15% of Europe's electricity supply before 2050 by generating power from solar and wind installations across the Middle East and North Africa. While this initiative brings its own problems; sandstorms and sourcing demineralised water for daily cleaning in the middle of the desert for example; this is something that needs to keep moving forward to ensure clean energy is available for the long-term.

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Natural gas and electricity wholesale prices continue to slide despite the wholesale price of Brent crude oil which is still following a year-long trend of spikes and falls and has remained around the $110 per barrel mark. The warmer than average weather in November and the record levels of storage have added security to the domestic energy markets.  Driving factors that could be considered local such as The Rough Storage facility in the North Sea reaching 95% capacity and additional generators coming online like the new 750MW biomass plant in Tilbury, don't do much to impact wholesale prices of Brent crude oil which is a global commodity based on the US$. If speculation that US are looking to become independent of Brent crude oil comes to fruition, changes would be seen and the worldwide prices would react accordingly.

Accounting for some 25% of the total daily worldwide oil consumption (for a country with merely 5% of the global population) and as the worlds biggest consumer of oil, the USA used almost 19 million barrels of oil a day in 2010, and much of that oil (9 million barrels daily) was imported. Still a very long way to go, and a lot of investment in offshore drilling at the very least, before imports can cease, but should it happen we could see huge drops in oil prices as countries worldwide look to secure the freed excesses.

Back to domestic markets though, and although gas and oil prices were on a slight rise last winter, electricity wholesale prices held steady. When you consider the below freezing weather the UK experienced last year the better forecast for this Winter should see prices hold, and hopefully continue to fall over the festive period. It is with this in mind that Clifford Talbot Partnership are tendering for our business energy procurement clients up to and beyond April 2012 - looking to ensure that we secure the best possible rates. It is this flexible approach to Utility Bureau Services that sets us apart from Energy Brokers and other Utility Consultants who will typically bulk together companies with little thought as to how the forward markets will act and what a client’s specific needs are. Something we consider very carefully when assessing future energy contracts for our clients.

Get in touch with our expert team of Energy Consultants and Utility Consultants to discuss any queries you have with Business Energy Procurement and Energy Management, or just a bit of friendly advice on the current state of the markets, which is always an interesting topic. As well as energy procurement and management, we also provide, amongst other valuable services;

• tenant billing
• invoice validation 
• billing error resolution
• energy surveys 
• annual energy budgets

Our service has proven its worth time and again and sees our clients extending their relationship with us year after year after year.

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Predictions of another UK recession may be premature, but the proposed Eurozone bailout fund that is being discussed by finance ministers in Brussels could result in drastic and urgent rethinking of much of the UK's expenditure. A massive €1tn fund had been expected but the  final total is now expected to be much lower and could fall some way short of the funds needed - not only would this not solve the Eurozone crisis, but it would also put additional strain on the lenders of this bailout. Hopefully news from Belgium later will clear this up and see a clear plan for the European economy being formed and implemented.

Staying on the continent, Spain has stated that the country will be looking at new nuclear projects under the new Conservative government - the outgoing socialist party was opposed to new nuclear power, but newly the elected People's Party have so far not ruled it out. Much like the UK, Spain currently relies on nuclear power generation for some 20% of the countries power and, although renewable generation will remain on the agenda, any extra supply will no doubt be welcome as populations continue to grow across the globe.

Spain has so far avoided Germany's criticisms of nuclear dependence of developed countries (notably aimed at the UK). Following the recent overhaul of their own nuclear generation plans, one German expert has stated that building new nuclear power stations will make it harder to switch to renewable energy. Germany is planning to phase out all nuclear plants by 2022, and conversely the UK is looking to expand its current fleet by adding a further eight new nuclear plants. Like Spain though, renewable power is still a top priority for the UK, but guaranteed long-term supply cannot be overlooked.

Turning to current wholesale prices Brent Crude Oil has continued falling and spiking, and has been hovering around the $108 per barrel point since mid-May. Natural gas and electricity prices have slid to 9 month lows - a very welcome trend.  At the very least a slight upward correction can be expected during the winter; although not necessarily a prolonged or major lift - the added demand and colder weather are likely to impact before Christmas.

It's not all about low market prices though; one sure-fire way of saving money is by simply reducing energy usage. One prime example is South Korean President Lee Myung-bak who has recently declared that he has lowered the thermostat in his workplace and now wears warmer underwear to keep warm! Instant savings!

For any advice on your Business Energy costs, information on Energy Savings and all your Procurement and Utility Bureau Service needs, get in touch today on 01454 281607.

Further to well covered recent news relating the huge profits of gas and oil companies, British Gas have agreed a deal with Statoil to buy some £1bn worth of Norwegian North Sea assets, and have pledged to look into the possibility of collaborating on further explorations in the area. The 15 year deal is enough to meet some 5% of the UK annual demand. Significant indeed, but far from the volumes that would be required to guarantee supply for the long term. The deal shows the commitment of British Gas to secure energy for the long-term, and as a partnership they will no doubt be a force to be reckoned with.
 
Elsewhere, following the Government's recent decision to halve the premiums paid for any solar powered generation that is returned to the grid through feed in tariffs (FiT's), the coalition have again backed investment in nuclear power stating that it is vital to continue investment in the controversial energy source and to push forward technological advances to keep the UK's energy options open. It is a move sure to promote responses from environmental campaigners - slashing the benefits of renewable energy and promoting more 'potentially dangerous' means of generation was always going to be a hot topic - but nuclear energy can be an inexhaustible form of generation, so to overlook its importance and long term security would be churlish.
 
With regard to current wholesale market prices of natural gas, brent crude oil and electricity, the recent trend has been a slowly falling one. Our hopes are that this continues into the New Year at least and ideally beyond and into the spring. But, as we're all too aware, the energy markets are extremely volatile and any number of events could result in an upward movement. Events in the Eurozone and more locally with the UK economy could impact markets in either direction so we will be keeping a watchful eye and will advise our clients accordingly.
 
Be as best informed as possible by appointing Clifford Talbot as your chosen Utility Consultant and let us take care of your business energy needs through our well established and respected Utility Bureau Service - you're sure to be impressed at how much time and money we can save you.

Despite unease across the entire Eurozone and beyond, the wholesale price of both electricity and natural gas has continued to slide over the past week. Brent Crude Oil is also falling; the recent trend of gradual climbs followed by sudden drops continues, and the start of this week saw wholesale prices fall to $112/bbl, down from $115/bbl at the same time last week.  From its recent high point of $126/bbl in May and its low of $101/bbl we're now at a mid-point between the two, with four climbs each followed by urgent falls; none of which can be directly linked with any single, or even a collection of, events across the globe.

Positively, the warmer than average weather has continued so we're yet to see a massive increase in demand - always a huge driving factor on the energy markets. With the current high level of natural gas storage across the country there should be no fears of a supply shortfall, especially if the mild weather continues. Of course, the real acid test would be an unforeseen and extended cold-snap, which would put a strain on capacity and in turn on prices.

As was widely reported recently - oil giants Shell and BP have posted staggering profits for the umpteenth time, prompting much discussion and anger from end users who are having to suffer some of the highest prices for energy in recent memory. Much less in the public domain is the fact that these companies are staring down the barrel of the massive bills expected once their oil platforms and wells need decommissioning, dismantling and capping where appropriate. It has been estimated that the costs of such work in the North Sea alone will reach some £30bn. Further costs involved in operations in the Netherlands, Norway and Denmark could push that up another 60% to £50bn. While there won't be many outsiders who will shed a tear over these costs, it puts the need for oil companies to profit in the short-term into perspective. Fortunately for them, these are long term projects so will no doubt be streamlined over time to reduce costs while meeting stringent decommissioning requirements.

Feel free to contact us using the details on these pages if you wish to discuss taking advantage of our Utility Bureau Service and expert Utility Consultants - safe in the knowledge that we have our finger on the pulse of all things energy related. You're sure to greatly benefit from our experienced team of Energy Consultants who will be more than happy to help.