Energy Market Update: UK Wholesale Gas and Power Trends (11th March 2025)
- Lee Guttridge
- Mar 13
- 3 min read
This week’s Energy Market Update explores key developments in the UK’s wholesale gas and power markets, including increased LNG supply, storage concerns, and policy shifts that could impact energy prices. Here’s what businesses need to know.
Wholesale Gas Market – Energy Market Update
The UK gas market is being shaped by bearish and bullish factors affecting supply, demand, and storage levels.
Bearish Trends:
EU LNG Storage Flexibility: The European Commission has confirmed that LNG storage can now count towards EU storage targets. Additionally, the 90% storage requirement may be delayed until 1st December under exceptional circumstances, offering greater flexibility and easing concerns about storage tightness.
Increased US LNG Supply: US LNG operator Venture Global has increased its 2025 export expectations, with weak Chinese demand and trade tariffs making Europe a preferred destination for LNG cargoes. This could stabilise gas supply and lower price volatility.
Bullish Trends:
Ukraine’s Storage Crisis: Ukrainian gas storage levels have fallen to 4.7%, raising concerns about winter supply security. To prepare for next winter, Ukraine must import at least 3-5 billion cubic metres of gas, increasing competition for European supply.
Russian Attacks on Gas Infrastructure: Continued Russian military strikes on Ukrainian gas facilities and its advances towards key gas pipeline territories are increasing uncertainty in the European gas market.
Potential Extension of EU Storage Regulations: Discussions about extending EU gas storage mandates until 2027 could sustain strong demand for gas storage, keeping supply tight and prices elevated.
Wholesale Power Market – Energy Market Update
The UK power market is experiencing positive momentum from renewable energy expansion but faces uncertainties due to funding cuts and interconnector reliability issues.
Bearish Trends:
Europe’s Largest Battery Storage Facility Goes Live: A 200MW battery energy storage solution (BESS) has begun operations in the UK, with an expansion to 300MW by 2026. The system can power 3.1 million homes for two hours, improving grid resilience and helping to integrate renewables into the energy mix.
Solar PV Surpasses Coal in the EU: Last year, solar PV generated more electricity than coal in the EU, marking a milestone for Europe’s low-carbon transition. This trend supports greater energy independence and price stability for the UK and Europe.
Bullish Trends:
Potential UK Renewable Energy Funding Cuts: The UK Treasury is considering cutting funding to GB Energy in the June spending review, which could slow renewable energy expansion and decarbonisation efforts.
French Nuclear Power Uncertainty: Concerns are rising over ageing French nuclear reactors, with frequent modulation (ramping power up and down) affecting reliability and interconnector availability. If France struggles to export power, the UK could face higher electricity costs.
What This Energy Market Update Means for UK Businesses?
Businesses should monitor LNG supply trends, as increasing US LNG exports and EU storage flexibility could create opportunities for more competitive gas pricing. However, geopolitical risks in Ukraine and potential EU gas storage mandates could sustain long-term supply pressures.
In the power sector, expanding battery storage and solar generation are helping stabilise energy costs, but uncertainties around UK renewable funding and French nuclear supply may increase price volatility in the coming months.
Stay Ahead with National Business Energy
At National Business Energy, we help businesses navigate market fluctuations with tailored energy procurement strategies. Whether you’re looking to optimise energy costs, explore renewables, or enhance efficiency, our expert insights keep you ahead of market shifts.
Stay informed with our Energy Market Update reports and visit National Business Energy to discover how we can help your business secure cost-effective energy solutions in an evolving market.
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