As the electricity market evolves, we are all being impacted – although for many the effect may be masked, it is still there.  The short term changes can be seen already, the longer term ones will be even larger.

Any contract, for any generator or consumer, whether fixed price, or some form of pass through / time of use is linked to the market value – and the market value is ultimately determined at a half hourly level at the time of delivery.

Fixed price contracts involve one side (the buyer of generation, or seller to consumers) taking a view of the future value of electricity at certain times of day in relation to standard product prices, as well as how much will be produced/ consumed.

The price weighting of fixed price contracts may hide the granular detail – but as the relative value and risk at different times of day change – so to does the value of any specific generation or consumption profile.

So what’s happening….

Price changes are happening at a fundamental level, demonstrated by the system balancing prices.

• Increasing solar generation across summer days leads to negative short-term prices at times, particularly if its windy.

• A more stressed system leads to more volatility in prices across the day.



Looking at the last 10 years of data, a clear change is clear to see…

In the period 2013 – 2017

• The shape of energy prices across the day is recognisable against demand. Prices are higher at times of peak demand as may be expected.

• The range of prices is greatest over the night. Using mainly thermal generation, overnight prices were sensitive to changing fuel sources between gas and coal.

• The largest range in prices in any period was around £100/MWh over a 5 year period.