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13 Jan 2017 | Filed under: Uncategorized

Mr. Moffitt’s Profits Times – January 2017

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Links of Interest

HOPE YOU ALL HAD A GOOD CHRISTMAS, AND WISHING YOU A HAPPY NEW YEAR.

Find out about small business rate relief at: https://www.gov.uk/apply-for-business-rate-relief/small-business-rate-relief

Have a look at this article by Edie for 2017 : Happy New Year: Seventeen big reasons for the green economy to be excited about 2017. http://www.edie.net/news/9/Happy-New-Year-2017-reasons-to-be-excited-green-economy-sustainable-business/

The Guardian has reported that Christmas Day was the greenest on record for energy generation, according to the power group Drax. https://www.theguardian.com/environment/2016/dec/29/christmas-day-2016-renewable-energy-uk-green-electricity

2017 Energy Prices

WHAT WILL HAPPEN TO ENERGY PRICES IN 2017? PREDICTIONS CAN BE PROBLEMATIC IN THESE VOLATILE TIMES. OUR AUDITEL UTILITIES EXPERT SHARES A FEW THOUGHTS:

Prices continued to rise before and after Christmas, and have only just eased off recently. Key driver was a weak pound and rising oil prices and some issues with output from our main gas storage facility plus some coal fired power stations going off line. Interestingly oil price movements have not boosted energy prices here as much as might have been expected, though when it suits the market to blame oil prices they do.

The key impact of Article 50 in the short term is probably going to be how will be its impact on the £ vs the Euro. The £ has driven a lot of the short and medium price movements including a recent recovery after a couple of weeks over energy price rises.

The problem with sentiment based drivers of energy is the degree to which the market has already built risk into prices which artificially inflates prices which can ultimately lead to a crash. So if the market has already factored in Article 50 into exchange rates, maybe there will not be much of a movement.

Also, what impact Article 50 will have on the UK economy is clearly debatable and will take time to become clear. Instinct and general media coverage would suggest it will not be a good thing in the short term which in turn will result in higher energy prices if the £ weakens further.

Donald Trump, new President of the USA: Sentiment might suggest that his global impact might be negative if he retrenches and makes America more insular, However, as a free marketeer he might stimulate global trade and economies.

America are another oil producing nation and higher oil prices may be in their interest, particularly as their own energy prices are very low currently and causing generators problems. So in this he may support continued co-operation with oil producers. Also, his response to the global terrorism threat could well be a factor if he were to undertake a policy that might destabilise things politically.

The French presidential elections in April/May: The decision by EDF Energy to back the investment in the new nuclear power station at Hinkley Point, Somerset was not universally accepted in France. EDF is mainly owned by the French Government. However,  the French energy industry and government are very closely linked and it seems unlikely that they would back out now as long as one of the central parties retains power.

 

 

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