A quick note from me (Josh):
Welcome to The George Briefing. Each week, my co-founder Lu and I use our tech-focused lens to scan the UK energy market. Our goal is to cut through the noise and deliver the key developments that will impact your business's bottom line, all explained in simple, actionable terms.
This weeks developments are:
Fuel Price Rip-Off Confirmed: How Inflated Margins Are Hitting Your Business P&L
The Great Switch: Why Moving From Gas to More Expensive Electricity Is Quietly Inflating Your Bills
Energy Market Overhaul: Why 30-Minute Billing Is Coming and What It Means For Your P&L
This Week's B2B Market Pulse
Six More "Hidden Gem" Stories You Might Have Missed
LATEST DEVELOPMENTS
The Guardian
Image source: Gemini / Meet George
The Spark: The UK's competition watchdog has confirmed that fuel retailers are maintaining profit margins far above historical levels, directly inflating your business's transport and operational costs.
The details:
The Competition and Markets Authority (CMA) is "deeply concerned" that the gap between wholesale fuel costs and pump prices remains excessively high.
Supermarket retailer margins have more than doubled, rising from 4% in 2017 to an average of 8.4% in the first half of this year.
Non-supermarket retailers have also seen margins jump from 6.4% in 2017 to an average of 9.8% over the same period.
The government plans to launch a "fuel finder scheme" by the end of the year, which will allow drivers to compare real-time prices to try and force more competition.
Why it matters: What's the real-world impact here? For any business running vehicles, this isn't just a consumer headline – it's a direct hit to your P&L. The CMA's report confirms that the high prices you're paying for petrol and diesel aren't just down to volatile global oil markets. A significant chunk is going straight to retailers' bottom lines through inflated margins. This is a systemic overcharge on a critical business input, making it more expensive to run your fleet, deliver goods, and visit clients, ultimately squeezing your own profitability.
What you can do:
Review your fuel card provider. If your deal is based on a discount from the pump price, you're getting a discount on an already inflated number. Investigate providers who offer pricing linked to wholesale costs.
Implement a 'smarter fueling' policy for your drivers. Use existing price comparison apps and don't assume the local supermarket is cheapest – the report highlights a 'postcode lottery' where prices vary significantly between towns.
Factor driver time into fuel cost analysis. A short detour to a cheaper forecourt might save money per litre, but the cost of the driver's extra time could outweigh the benefit. Calculate your break-even point.
Department for Energy Security and Net Zero
Image source: Gemini / Meet George
The Spark: The latest government data reveals a critical shift in how UK businesses use energy, moving from gas to more expensive electricity, which could be quietly inflating your operational costs.
The details:
Total UK final energy consumption rose by 2.6% in 2024, reversing the long-term downward trend, with increases in the domestic (+3.8%), services (+3.8%), and transport (+2.9%) sectors.
In contrast, industrial energy consumption fell by 1.2% to a record 50-year low, showing a clear divergence between industrial efficiency and rising consumption elsewhere.
The transport sector's dominance grew, now accounting for 42% of all final UK energy consumption, primarily driven by petroleum fuels in road and air travel.
The underlying shift to electricity continues: electricity's share of transport energy has more than tripled in the last decade (from 0.7% to 2.2%), and domestic electricity use for heat pumps has quadrupled over the same period.
Why it matters: What's the real-world impact? The crucial story for your P&L is the shift from gas to electricity. As businesses electrify their fleets and heating systems, they are moving consumption to a commodity that is typically three to four times more expensive per unit. This means even if your overall energy usage stays flat, your total energy bill is likely to rise significantly. This isn't a vague, long-term trend; it's an immediate operational cost challenge that requires a proactive procurement and management strategy.
What you can do:
Pull your last 12 months of energy bills and calculate your electricity vs. gas cost ratio. Is your electricity spend growing as a percentage of your total energy cost?
If you plan to install EV chargers this year, ask your installer how this will affect your peak demand and whether you need to review your supply capacity with the network operator.
Check if your current electricity tariff includes high peak-time charges (often called red-band charges) and assess whether your new consumption patterns are exposing you to higher costs.
The Retail Energy Code
Image source: Gemini / Meet George
The Spark: A major behind-the-scenes energy market reform just hit a key milestone, setting the stage for every UK business to be billed based on its actual half-hourly electricity use.
The details:
The Retail Energy Code (REC) has successfully implemented the technical and governance changes required for Market-wide Half-Hourly Settlement (MHHS).
MHHS is an Ofgem-led reform that will shift the entire electricity market to settling energy usage every 30 minutes, moving away from the current system of estimates and infrequent meter reads for many.
The goal is to enable a smarter, more flexible grid where energy prices can reflect near real-time costs, supporting innovative tariffs that reward off-peak energy use.
The full migration of all business and domestic meters to the new system will occur over the next 18 months, with a target completion date of May 2027.
Why it matters: While 'Market-wide Half-Hourly Settlement' sounds like pure industry jargon, its real-world impact on your P&L is direct and significant. This reform effectively makes understanding when you use energy just as important as how much you use. By basing bills on 30-minute consumption data, suppliers will be able to offer tariffs that are much cheaper overnight and much more expensive at peak times. For businesses, this presents a clear trade-off: those who can shift energy-intensive operations to off-peak hours stand to make significant savings, while those with rigid, 9-to-5 energy profiles could face higher costs. This isn't a distant change; it's the fundamental rewiring of energy procurement strategy for the next decade.
What you can do:
Check your meter: Confirm you have a smart meter (SMETS2) or AMR meter that can provide half-hourly data. If you don't, contact your supplier to request an installation to get ahead of the mandatory rollout.
Request your data: Ask your current supplier for your half-hourly consumption data. Analysing these patterns is the first step to understanding where you can shift load and save money.
Question your broker/supplier: Ask them about their strategy for MHHS and what new 'time-of-use' or dynamic tariffs they plan to introduce. This signals you're an informed buyer preparing for the change.
LATEST MARKET NUMBERS
⚡ B2B Market Pulse
Wholesale Electricity Price (weekly avg.): 5.07 p/kWh (🔻 -1.13 p/kWh / -18.2%) - Power prices fell sharply despite headwinds from other commodities, suggesting low demand or high imports dominated the market.
Wholesale Gas Price: 2.91 p/kWh (📈 +0.17 p/kWh / +6.2%) - Gas prices saw a notable rise, adding upward cost pressure that the power market ultimately shrugged off.
UK Carbon Price (UKA): £54.26 per tonne (📈 +£1.74 / +3.3%) - The cost of carbon rebounded slightly from last week's lows, adding a small bearish signal to the market.
Wind + Solar Generation (Share of UK Mix): 38.4% (🔻 -18.8 pts / -32.9%) - Renewable generation fell significantly from last week's blockbuster levels, contributing less than 40% to the grid mix.
The Meet George Take
This week's market tells a counter-intuitive story. Last week was a textbook example of fundamentals aligning, with high renewables and low carbon costs driving down prices. This week, that alignment reversed completely, yet prices fell anyway.
All the key drivers pointed towards a price spike: gas and carbon costs both ticked up, and renewable generation fell off a cliff, dropping by nearly a third. And yet, the wholesale electricity price collapsed by over 18%. This signals that other powerful factors, most likely very low weekend demand or a flood of cheaper imported power from Europe, completely overwhelmed the bearish fundamentals here in the UK.
For a business, this is a crucial lesson in modern market complexity. The relationship between gas, carbon, and renewables is no longer a simple equation. Procurement windows can appear even when the obvious signals look negative. It's a clear sign that the grid's growing interconnection with Europe and real-time demand are becoming the new dominant forces in price setting.
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