Index reveals marginal fall in cost of energy

Good time to invest in low-carbon and renewables despite ‘eerily calm’ energy markets

ENERGY prices have slipped a further 2% in the first quarter of 2014, sitting marginally higher than they were 12 months ago, latest data from the Lorien Energy Index (LEI) has revealed.

The Lorien Energy Index, which is produced by Lorien Engineering Solutions, monitors the overall cost of energy for business users and allows companies of all sizes to make sense of their current energy consumption and look at ways they can make savings in the future, by being energy efficient and utilizing low-carbon and renewable technologies to boost energy security.

Concerns over wider wholesale energy prices have not been realized over recent months with stockpiles and reserves for both oil and gas smoothing out ripple effects from geopolitical instability in crisis zones.

Describing the current outlook as ‘eerily calm’, the International Energy Agency (IEA) has attributed the nine-month low in the price of oil to the current ‘glut’ in the market, with sharp falls in demand against rising production.

With positives to report on fossil fuel prices, recent wider energy news shows the overall contribution from renewable energy production in the UK increased during 2013 to stand at nearly 15% of total.

However, Lorien say that while this is an encouraging statistic, the UK is still languishing with more than a third generated from coal-fired power plants, around 30% from gas and the remainder from nuclear.

‘What should make those ‘on the fence’ take notice are the large sums of money – more than £3 billion a year – being spent incentivizing the growth in green ‘home-grown’ energy,’ noted Lorien’s sustainability consultant, Tom Jordan.

‘Negative press for large-scale generation, such as the now scrapped Celtic Array, and uncertainty over the second biomass conversion at Drax, does not marginalize the fact that now is an excellent time to be investing in your business’s energy resilience.

‘Lowering resource use is not just about energy,’ said Mr Jordan. ‘There has never been a better time to widen the scope to focus on overall resource use, matching up wastage with opportunities for further minimization and re-use.’