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 go directly to the source of change in the UK energy market, the official publications from Ofgem and the UK Government. Our goal is to cut through the noise and deliver the key regulatory developments and changes that will impact your business's bottom line, all explained in simple, actionable terms.
This weeks developments are:
The Grid is Creaking: Government Launches Urgent 'Resilience Strategy'
The Supplier 'MOT': Ofgem's New Plan to Stop Energy Firms Going Bust
The End of Tax-Free Driving: 'Pay-Per-Mile' Coming for Business Fleets
This Week's B2B Market Pulse
Hidden Gems Also Worth Reading
LATEST DEVELOPMENTS
Ofgem
Image source: Gemini / Meet George
The Spark: Ofgem is putting energy suppliers through a new financial 'MOT' to prove they're stable, aiming to prevent a repeat of the supplier collapse crisis that hit businesses hard in 2021.
The details:
Ofgem has implemented a new 'milestone assessment' process for all licensed gas and electricity suppliers in the UK.
Suppliers are now required to proactively notify the regulator at key moments to trigger an assessment of their financial health and operational capabilities.
The process is designed to test if suppliers are financially responsible and operationally sound enough to withstand market shocks.
This is part of a wider regulatory clampdown on the energy retail market to improve overall financial resilience.
Why it matters: This isn't just more regulatory red tape; it's Ofgem's direct response to the chaos of 2021 when dozens of poorly-run suppliers went bust. The 'milestone assessment' is a stress test designed to weed out financially unstable suppliers before they collapse. What's the real-world impact for your business? A more stable, albeit potentially less crowded, market. While you might see fewer unknown suppliers offering rock-bottom prices, the risk of your supplier going bust and your business being thrown onto expensive, out-of-contract rates with a new provider is significantly reduced. This is a classic trade-off: slightly less aggressive price competition in the short-term for much greater long-term market stability and security for your P&L.
What you can do:
Ask the stability question: During your next renewal, ask potential suppliers or your broker, "How are you demonstrating financial resilience under Ofgem's new assessment framework?" A confident answer is a good sign.
Weigh stability in your procurement: When comparing quotes, don't just focus on the lowest unit price. Give extra weight to established suppliers with a track record of stability, even if it costs a fraction more.
Check your broker's due diligence: If you use a broker, ask them how they vet the financial health of the suppliers on their panel and if their process has been updated to reflect these new rules.
DESNZ
Image source: Gemini / Meet George
The Spark: The government is finally getting serious about preventing costly power outages by launching a new strategy to protect the UK's ageing and vulnerable energy grid.
The details:
A new 'Energy Resilience Strategy' is being developed following a major fire at a National Grid substation in March which caused widespread disruption.
An investigation by the National Energy System Operator (NESO) found the fire was likely caused by an electrical fault in ageing equipment.
The government, regulators, and industry will implement 12 recommendations over the next year focusing on better maintenance, fire safety, and response coordination.
The full strategy, to be published next year, will address evolving risks including climate change impacts, cyber threats, and geopolitical tensions.
Why it matters: This announcement is more than just another government paper; it's an official admission that the UK's critical energy infrastructure is creaking. The North Hyde fire wasn't a freak accident, but a symptom of decades of underinvestment. For a business owner, this shifts grid reliability from an assumption to a calculated risk. While the strategy aims for long-term fixes, the immediate operational reality is that the risk of localised, high-impact outages is very real. This moves backup power and continuity planning from a 'nice-to-have' to a core part of your operational risk management, directly impacting decisions on opex and capex budgets.
What you can do:
Review your Business Continuity Plan: What is your exact protocol for a power outage lasting more than four hours? Ensure key staff know their roles and all contact lists are up to date.
Assess your backup power: Evaluate the cost vs. benefit of an Uninterruptible Power Supply (UPS) for critical servers and IT, or even a generator if your operations are highly sensitive to downtime.
Check your insurance policy: Contact your broker to clarify what your business interruption insurance covers in the event of a power cut caused by a grid-level failure.
The Guardian
Image source: Gemini / Meet George
The Spark: The government is signalling the end of tax-free driving for electric vehicles with a new pay-per-mile charge, directly impacting the running costs of your business fleet.
The details:
The Treasury is expected to introduce a pay-per-mile charge for electric vehicles (EVs) from as early as 2028 to replace the £24.4bn in lost fuel duty revenue.
An initial proposal suggests a charge of 3p per mile, which would add approximately £267 per year to the cost of an average EV.
This new tax follows the removal of other EV perks, such as Vehicle Excise Duty (VED) exemption and, from 2025, exemption from London's Congestion Charge.
Industry groups and manufacturers are concerned the timing is poor, warning it could discourage businesses and consumers from switching to EVs, pointing to New Zealand where a similar policy caused a sharp drop in EV sales.
Why it matters: What's the real-world impact? For years, the business case for switching to an EV fleet has been built on significantly lower running costs. This proposal marks the beginning of the end for that simple calculation. The government needs to plug a multi-billion-pound hole left by disappearing fuel duty, and EV drivers are the only viable source. For your business, this means the Total Cost of Ownership (TCO) models for fleet vehicles must now account for a new, variable tax liability. It's no longer a straightforward comparison of electricity vs. petrol; it's a strategic calculation that must now factor in future government tax policy, fundamentally changing how you budget for vehicle procurement and operational costs.
What you can do:
When modelling the Total Cost of Ownership (TCO) for any new fleet vehicles, add a line item for a potential 'road user charge'. Use a conservative estimate of 3p-5p per mile to stress-test the financial case for EVs versus petrol or diesel.
If your employees use their personal EVs for business travel (the 'grey fleet'), review your mileage reimbursement policy now to ensure it can accommodate this future tax without leaving your staff out of pocket.
Engage with your fleet provider or leasing company to understand how they are preparing for these changes and whether new contracts can offer protection or clarity on these future costs.
LATEST MARKET NUMBERS
⚡ B2B Market Pulse
Wholesale Electricity Price (weekly avg.): 8.74 p/kWh (🔺 +1.54 p/kWh / +21.4%) Another significant surge, compounding last week's rise. Prices are now aggressively high compared to early November.
Wholesale Gas Price: 2.69 p/kWh (Hz) (🔻 -0.12 p/kWh / -4.3%) Based on 78.76p/therm. A surprising dip, meaning gas as a raw commodity actually got cheaper.
UK Carbon Price (UKA): £57.84 per tonne (🔺 +£0.84 / +1.5%) A slight uptick, continuing the slow, steady rise we've seen all month.
Wind + Solar Generation (Share of UK Mix): 36.7% (🔻 -9.7 pts / -20.9%) A major drop in green output. The grid lost nearly 10 percentage points of "free" fuel compared to last week.
The Meet George Take
The "Still Weather" Tax has arrived.
If last week was a warning shot, this week is a direct hit to the P&L. We are witnessing a textbook disconnect that every business owner needs to understand: Gas became cheaper, but your electricity became 21% more expensive.
Why? Because the wind stopped blowing.
Renewable generation plummeted by nearly 10 percentage points (down to 36.7% of the mix). When wind and solar drop off, the National Grid has to fill that massive gap by firing up gas turbines.
Even though the price of gas dropped slightly (-4.3%), the volume of gas we needed to burn to keep the lights on skyrocketed. We shifted from a grid powered nearly half by free wind to one heavily reliant on fossil fuels. Furthermore, when the grid is desperate for power, it has to call on the oldest, least efficient gas plants to run—and those plants charge a premium.
The Bottom Line: We are in a period of high sensitivity to weather patterns (often called "Dunkelflaute" or dark wind lulls). Until the wind picks back up, electricity prices will remain detached from the underlying cost of gas. If you are on a flexible or pass-through contract, you are currently paying a premium for the weather, not the fuel.
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