Gas Contracts

By: Energy Solutions  11/11/2011
Keywords: gas, environment, energy

     3. Gas Prices

Unlike the electricity market your gas is pre-bought and sold on by the energy companies. Your price will depend upon two main factors: your usage, which the companies are given by the network (Transco), and delivery charges. The further away from the terminals you are, the more transport costs you incur.

If your usage is in below ~750,000 kWh per year the prices will come from the gas companies general pricing structures which used to move every week, but now change almost daily. If your usage is above this level and into the 1,000,000’s the companies will go to the open market and get you a price that may be valid for only a day or few hours.

The day to day prices in the larger market reflect the open market conditions, if the Met Office tell us ‘its going to be the worst winter in history’ (see Nov 2005), if there is trouble in the middle east, if Russia cuts off a neighbour, the prices will fluctuate dramatically. Often there is not a ‘real’ supply issue; it is just the nerves of the market.

Keywords: energy, Energy Brokers, energy procurement, energy purchasing, environment, gas, Gas Brokers

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