As the east coast of Australia sees a universal easing of lockdown laws, as well as a wet and warm start to Spring, many business owners are now wondering what’s coming next to influence their challenges and successes. With our finger on the pulse, and an array of energy industry data at hand, here are factors coming into play over the next six months, and how they may impact you. The underlying theme? Supply and demand.
A rocketing bounce-back by the wholesale energy market
Initially brought down by the disruption of covid-19, forcing many businesses to close or power down, between February and July Victoria alone saw an 80% bounce back of the cost of wholesale energy. Recent lockdowns too brought a softening to the market, but with all evidence pointing towards a return to normal business, and “normal” energy prices to go alongside it.
A balmy Spring, with summer around the corner
From Queensland to Tasmania, Australia is anticipating a “warm and wet” start to the summer season, with even overnight temperatures pushing up higher than normal. And with warmth comes demand: Research suggests summer can be the most expensive time to procure energy as the states turn to electricity to keep cool and carry on. Last year’s Summer contributed to that low market due to cooler than usual weather, but remains unlikely to give businesses a break as we head into 2022.
Welcome back, big (and small) business
Pubs, hotels and other hospitality businesses have been patiently waiting in the wings for their return to work, even in states unaffected by lockdowns. As vaccination rates across the country improve, so too will movement and travel, bringing life back to holiday hotspots and attractions. And of course, where there is activity there is energy: Demand is anticipated to surge once more as high energy users in the industry begin to shift back into gear, as well as small businesses like family owned cafes and boutiques.
So what can you do?
For all businesses, knowledge truly is power. As we anticipate this demand growth, it is time to look ahead now before summer demand and open borders, to take advantage of market prices before these factors come into play. Small businesses in particular with monthly spends of $2500 or less are not left out, as this opportunity to save is applicable across the board.
Australian Power Index (National) 5 October 2020 - 4 October 2021
Have you received your complimentary Energy Health Review yet?
For businesses with contracts ending or up for renewal around December 2021 or in the next 12 months, now is an ideal time to investigate forward contracting, locking in an agreement before the market shifts. Choice Energy is offering complimentary Energy Health Reviews to businesses ready to optimise their energy bills and ensure they are prepared for their next chapter. Click here to learn more.