Temperatures are set to fall over the weekend and snow is also forecast for some parts of the country. The cold weather’s coming from Siberia and many European countries have been experiencing the cold spell all week. Falling temperatures could mean we start to see a rise in business gas prices.

However, just as we reach the worst of the winter freeze it’s reported that Russia has cut gas supplies to some European countries. Taken along with the cold weather this could have an impact on business gas prices as countries look for alternative gas supplies. This increase in demand for gas will help to push up wholesale energy prices.

Russia has blamed Ukraine for taking more gas than it should although this has been denied by Ukraine. It said it was covering an increase in demand for gas from its own domestic supplies.

Austrian gas supplier OMV said Gazprom supplies were down by about 30% and blamed the severe weather being experienced in Russia at the moment. Temperatures there are down to -35C currently. OMV said it was coping with the cut in supplies with domestic production and its own storage supplies.

German and Italian energy suppliers have also remarked that they are getting less gas than normal from Gazprom.

While this seems to be none of our concern the increase in demand for gas will filter through to businesses in the UK in the form of higher wholesale gas prices and therefore higher business gas rates.

Many businesses have been lucky so far this winter. It’s been a much milder winter than was expected. However, businesses, especially small businesses could be caught out by a sudden increase in business gas and electricity prices which could increase by as much as 30% according to some reports.

The cold weather will mean businesses will begin to use more gas and electricity. They may be in for a shock when their next bill arrives if they don’t prepare for it now, especially if they are not in a fixed rate contract.

The advice then is to prepare for higher business energy bills before the cold weather arrives especially if you are a small business user. Many small business owners don’t spend enough time on their energy costs because they are involved in so many different aspects of their business. However, it’s important that businesses plan what to do when and if cold weather arrives. This may include planning for staff to work from home if they can’t get in or it isn’t safe to travel.

In the current climate, can businesses not afford to spend time on their energy costs?

It’s long been argued that burying electricity cables underground is far too expensive and pylons are the cheapest way forward. However, an independent report says that burying cables is actually cheaper than claimed by National Grid.

The news is welcomed by countryside campaigners and will especially be good news for those campaigning in Scotland. As Utility Exchange has reported, there have been calls for the new Beauly-Denny power lines to be buried but ScottishPower has rejected the call saying it’s too expensive.

It’s been argued that because burying cables is so much more expensive then it would mean an increase in both domestic and business electricity prices as the increased costs would have to be passed on to consumers.

The report comes from Parsons Brinckerhoff, engineering consultants who looked at the comparative costs of different ways of routing transmission cables. National Grid has often said that underground cables would be 10-20 times more expensive than overhead power lines but the report from Parsons Brinckerhoff found that it was 4.5-5.7 times more expensive.

The latest figures mean that it would be reasonable for the Government to insist that when cables have to go through a national park or areas of outstanding natural beauty, they are buried underground. However, the fact is that it will still be more expensive to bury power cables and therefore these extra costs may well be passed on to consumers through higher electricity prices.

A spokesman for the Campaign to Protect Rural England (CPRE) said “We are not saying that you should bury all cables, and we accept that this is a more expensive option, but we think people would be prepared to pay a few extra pounds a year to have them buried in treasured landscapes like national parks and areas of outstanding beauty”.

However, National Grid said the report’s findings were largely in line with costs it had been quoting. Infrastructure Development Manager at National Grid, David Mercer, said “This report will be a valuable contribution to the public debate on the right balance between visual impact and costs that must ultimately be paid for by consumers”.

The Government had wanted every household in the country to have an energy smart meter by 2019 to ensure gas and electricity bills were more accurate. However, the £19 billion programme has been cancelled amid concerns over health and safety and privacy.

Campaign groups and back bench MPs have campaigned against the introduction of compulsory smart meters over concerns that they emit electromagnetic radiation and because they transmit 24 hours a day they can’t be turned off. Concerns have been raised in both the US and Canada about the potential health effects of smart meters.

In addition, concerns have been raised that data transmitted by the devices could give authorities an idea about how people live. It’s been argued that this was an invasion of privacy. For example, the devices would show when someone was away on holiday, at work or asleep.

Consequently the Department for Energy and Climate Change (DECC) has decided to cancel the roll out to avoid legal battles. Utility Exchange reported last year that British Gas had started its smart meter roll out. Around 400,000 have already been installed in British homes although most of the smart meters installed emit a similar amount of radiation as that from a mobile phone or a micro-wave.

It’s been argued that smart meters enable consumers to monitor their energy use and make immediate changes to cut their energy consumption. They show how much energy each individual appliance uses making it easy for consumers to see how much they are spending on electricity. As both domestic and business electricity prices increase this would allow consumers to take action in reducing their energy bills.

Smart Meters would make it less likely that a business or homeowner would suddenly get a huge energy bill because their meter hadn’t been read for years. Smart Meters send information back to the energy supplier constantly and therefore they ensure more accurate bills for both home owners and businesses. But not only do they help to ensure more accurate billing, smart meters also enable homeowners and business owners to see what’s using the most energy and make changes to ensure energy efficiency and to lower their bills.

Regulators say smart meters are perfectly safe but in the United States utility companies have been fighting lawsuits from people who have had them fitted in their homes and who claim they have made them ill.

Plans are now being drawn up to enable people to reject smart meters and make their introduction voluntary. The energy minister, Charles Hendry, said “We believe people will benefit from having smart meters. But we will not make them obligatory”.

A report published by Siemens says that 1 in 3 of those responsible for energy management in UK businesses say that their organisation doesn’t take it seriously.

At a time when business electricity prices and gas tariffs are rising and when economic conditions are tough, energy management is something which businesses should be taking into consideration. However, according to the report this doesn’t appear to be the case.

The report, the Siemens Green League report, looked at the views of 600 businesses. The report showed that those in the boardroom were much more confident about how the company dealt with energy management while energy managers were less confident. The report showed that 83% of board directors thought their organisation was serious about energy management.

Energy is a critical area of cost for UK businesses. Therefore it came as a surprise to find that 27% of board directors didn’t know what their business energy bill was and 9% said they couldn’t afford to invest in energy management projects.

Thirty per cent of directors blamed a lack of obvious return on investment for the reason they avoided committing to energy efficiency measures. This lack of enthusiasm for energy management at board level filtered down to managerial level according to the report. Around 43% of energy managers said they only spent 10% of their time on energy management. They said that other duties including health and safety took up most of their time.

There were some positive findings from the report however. It found that 70% of businesses were planning to invest in energy efficiency projects over the next three years. The industries which appeared most committed to investing in energy efficiency measures included food and automotive manufacturing.

MD of Siemens Industry Sector in the UK and Ireland, Juergen Maier said “These results do give cause for concern. Not only is the UK subject to strict legislative carbon reduction targets, but many businesses are neglecting the impact that effective energy management can have on the bottom line. With significant costs attached to energy and indicators suggesting that high energy costs are here to stay, it really is in the interest of all businesses to take energy management seriously and look at the potential savings that can be achieved”.

He praised the manufacturing industry though. He said “It is, however, great to see manufacturers coming out so positively in this research. As an energy-intensive sector that has been governed by legislation for some time, there will be numerous examples of best practice across our industrial base that other sectors can adapt for their own organisations and reap the benefits”.

He finished by saying “It is important to note that the research does highlight evidence of good work being done by companies of all sizes across all sectors, but the overriding message is the need to do so much more. Now is the time for action or businesses risk falling behind in an increasingly competitive global marketplace”.

The news over the last few weeks has been about the Big Six energy companies cutting domestic electricity and gas prices as a result of the fall in wholesale energy prices since last summer. However, wholesale energy prices are now rising as forecasters warn cold weather is on the way.

The forecast of cold weather for the next month has seen power and gas markets driven up as cold temperatures raise concerns about supplies. Business gas prices and electricity prices differ from domestic prices partly because energy is bought for business use largely from the day ahead market. However, day ahead power has increased by £0.60/MWh to £44.00/MWh because the markets expect demand to increase.

There’s been even more movement in longer term prices. Summer 12 power has risen by a significant amount – £3.10/MWh to £45.30/MWh. This is the highest it’s been for 5 weeks, so it’s not an insignificant increase.

International energy markets are also higher largely as a result of uncertainty over the situation regarding Iran. In addition EU power prices have risen and as a result coal prices have also gone up.

The message is clear. With the threat of a prolonged cold spell and concern over power supplies, if your business energy contract is due for renewal, compare business gas rates and electricity prices now. Prices are on their way up so renew before they start to increase.

Centrica has reached an agreement with ConocoPhillips to buy its non-operated interests in the gas and oil producing North Sea field of Statfjord and associated satellites. The oil and gas fields are located in the Norwegian and UK sectors of the North Sea and produce gas for the UK. Centrica announced that the deal would provide another source of gas for the UK and therefore would improve the country’s energy security.

There are concerns over the UK’s energy security. At the moment the UK imports a large percentage of the oil and gas that it uses. Therefore the UK is susceptible to rising wholesale energy prices and as a result businesses could be faced with rising business gas prices or electricity prices. Improving energy security in the UK will help to prevent businesses and households from being at the mercy of wholesale energy price increases.

The deal means that Centrica’s overall stake in the field will increase to 34.30%. Gas produced in the satellites associated with the Statfjord field all produce gas that’s already contracted to Centrica and linked to the UK market or which has yet to be contracted.

The agreement will add an extra 36 million barrels of oil equivalent reserves to Centrica’s portfolio. It means there will be an extra 11,000 barrels of oil equivalent produced each day.

However, in order to maximise production in these areas Centrica said development costs would amount to around £200 million.

Managing Director of Centrica Energy, Mark Hanafin, said, “Increasing our stake in Statfjord marks the latest stage in our drive to secure high quality sources of gas for our customers, adding both earnings and long-term value to Centrica.  The acquisition, which follows our announcement last year of a new 10 year gas supply deal with Norway and acquisition of assets from Statoil, underlines our commitment to invest in North Sea production and secure future energy supplies for the UK”.

Back in November, Centrica signed a deal with Norway worth £13bn. The deal involves the supply of gas from Norway starting in 2015. The company also announced that it had acquired £1bn worth of development and producing assets in the North Sea from Statoil. Combined with the Statfjord acquisition Centrica will have increased reserves by almost 40% and increased production by over 30%.

Mabey Bridge, based in Chepstow, has won a multimillion pound contract to build wind turbine towers for various wind farm sites in the UK. The company signed a deal with the Germany company Nordex and as a result Mabey Bridge has taken on 45 new members of staff and moved 50 to its factory in Chepstow.

The business said the contract was a boost for its staff after a challenging 2011. Fourteen of the towers will go to the Pant-y-Wal wind farm in Rhondda while the rest will go to sites in Scotland.

The company opened in May 2011, creating 240 jobs at the factory in Chepstow which has the capacity to manufacture 300 towers a year.

Staff will work round the clock on the project to build 35 towers, starting in February and 170 staff will be involved in the project.

The towers will be the first to be made by a Welsh company, to be installed in Wales. While 14 of the towers will be erected at Pant-y-Wal wind farm, the rest will go to the Baillie wind farm near Thurso in June.

When operational the turbines will have the capacity to generate enough electricity for around 60,000 homes and small businesses.

Alex Smale, the UK director of Mabey Bridge said “To put this into perspective last year the UK wind market was less than 250 towers so this is a really significant order. All of these towers will be made in Wales. The towers you see around the country have historically been made in northern Europe – not even in the UK at all”.

Cheryl Gillan, the Welsh Secretary, welcomed the announcement and said “This is not only excellent news for the economy in Wales, but for the UK’s renewables and manufacturing industries as a whole. The awarding of this contract is a clear demonstration of the confidence European countries continue to have in the talent, expertise and skills of our workers here in Wales”.

Businesses are facing both energy price rises and the need to reduce their carbon emissions so it’s no surprise that it’s never been more important for businesses to cut their energy costs.

Average wholesale electricity prices have doubled over the last 10 years but it’s still possible to cut energy costs in a few ways. For example, many businesses are looking at generating their own electricity via sources of renewable energy. Some businesses are having solar panels installed to help reduce electricity costs and any extra electricity generated can be sold to the grid.

Many businesses, if they are unable to generate their own electricity are choosing green energy suppliers such as Ecotricity or Good Energy. Some are choosing to go green even if this isn’t the cheapest option. Policy adviser at the Federation of Small Businesses (FSB) said “The growing importance of ‘being seen to be green’ means that even the smallest of businesses want to demonstrate their green credentials to their customers. We have seen a growing interest in small businesses wanting to source their energy from smaller green energy suppliers”.

However, if you’re a small business and not in a position to install energy generation systems and find green energy suppliers too expensive then the least you should be doing is shopping around for energy suppliers. However, most SME’s are not acting and research suggests that small businesses are wasting £2bn a year by not comparing energy prices.

In addition to comparing business electricity prices and business gas prices small businesses can also cut energy costs through improved efficiency. This is something the smaller energy suppliers are keen on and the CEO of Good Energy, Juliet Davenport, said “Good Energy places a strong emphasis on offering energy efficiency advice and customer service. Our customer care team was the first to be trained in the EST (Energy Savings Trust) endorsed energy efficiency advice standard”.

Ecotricity tries to install smart meters at all of its business customers’ sites as does First Utility. Smart meters ensure businesses only pay for what they have used and mean more accurate billing. They also enable businesses to identify where they could cut down on energy costs.

Monitoring energy usage will help businesses to cut their energy consumption and therefore their energy costs. But it’s still the case that the majority of businesses don’t compare business electricity or gas and therefore are paying far more than they should be for their energy. In the current economic climate can anyone afford not to compare prices and switch if necessary?

Despite suppliers cutting gas and electricity prices by around 4% last week, prices are still high after energy companies increased prices by as much as 19% during the summer of 2011.

The average household energy bill has doubled over the last six years and the average cost of lighting and heating for a year is around £1,200, but it’s still a fact that more than 50% of consumers have never switched energy supplier. In fact only around 5 million people switch energy supplier each year and many of these are people who regularly compare and switch. There are very few new switchers.

Wholesale gas prices have fallen by 19% since August 2011 while electricity prices have fallen 25%. Many commentators suggest that wholesale electricity prices are set to fall even further. However, despite this, ScottishPower, EDF Energy and npower have only cut gas prices by 5% and SSE has cut gas prices by 4.5%. The other Big Six energy suppliers, E.ON and British Gas have cut electricity prices – E.ON by just 6% and British Gas by only 5%.

The Big Six blame costs other than wholesale gas and electricity prices such as transportation and government levies for why they can’t cut prices further. The other argument is that many of these companies buy their energy months in advance so that much of their electricity and gas being used now was bought when wholesale costs were higher.

If you have access to the internet it’s easy to compare electricity prices and gas tariffs whether they are domestic or business prices. But even if you can’t get on the internet many comparison companies will allow you to send in your energy bills so that they can compare them. Or if you prefer to talk to someone about, for example, business electricity prices, then you can phone a company such as Utility Exchange on 0800 4118830 and a customer adviser will take your details and find the right deal for you.

Much still depends on where you live and how much energy you use. There’s no one supplier which can be said to provide the cheapest prices across the country. Many suppliers will offer a discount if you choose to pay by direct debit which could save around 10% on your energy bill. It may similarly pay to choose a dual fuel tariff because most suppliers offer dual fuel discounts.

With finances being squeezed from all directions at the moment this is an expense which consumers can actively influence. Many people worry that they’ll end up without any electricity or gas but this won’t happen, even with business energy transfers. However, consumers must ensure that they are not in debt with their current energy supplier otherwise they may block the transfer.

Now is the time to compare energy prices, especially if you’ve never compared and switched before. You may be surprised how much you can save!

Ofgem says it has fast tracked plans by ScottishPower and SSE for improvements on infrastructure and a final decision will be made in April after consultations.

The infrastructure investment from SSE and ScottishPower will be paid for through energy bills. It’s likely to increase energy bills by 35p a year between 2013 and 2021. Ofgem said the proposed upgrades would “deliver essential upgrades to Scotland’s transmission network at the lowest cost to consumers”.

The work, set to cost around £7bn, will see overhead cables replaced with thicker cables to increase capacity. This is just a small part of what needs to be spent on the grid over the next decade. The improvements should see around 1500 jobs created over the next 9 years with both the energy companies and with engineering groups.

ScottishPower said the investment would mean it is able to connect both offshore and onshore wind power in Scotland to the grid. This accounts for around 11GW of electricity which is enough to power around 6m homes. Not only that but it would mean that Scotland would be able to export a larger amount of electricity to England – an increase from 3.3GW to 7GW over the next ten years.

The chief executive of ScottishPower Energy Networks, Frank Mitchell said “This will be the most significant investment in electricity infrastructure to have taken place in the last 60 years”.

National Grid is proposing to invest £30bn in the electricity transmission network in England and Wales but these proposals have not been fast tracked. However, a figure close to this is likely to be approved towards the end of 2012. Ofgem is not able to say at the moment how much energy bills will increase as a result of this increased investment. But the regulator does say that as much as £200bn needs to be spent in the energy industry over the next 10 years to ensure security of supply.