Industrial gas prices shrank a tenth in spring 2014

Cheaper wholesale gas has seen the gap between UK power and gas prices shrivel in 2014. The shrinking wedge appears clear from recent statistics released by the Department of Energy and […]

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By Vicky Ellis

Cheaper wholesale gas has seen the gap between UK power and gas prices shrivel in 2014.

The shrinking wedge appears clear from recent statistics released by the Department of Energy and Climate Change.

The average cost of gas was 12.6% lower in April to June 2014 than the same year before.

Meanwhile average electricity prices for industrial users rose 5.6% between the second quarter of 2013 and 2014.

The figures in real terms (i.e. with inflation factored in) also take into account the Climate Change Levy, a tax on the carbon emissions from creating energy with fossil fuels.

A chart of DECC's Fuel Price Indices, including the Climate Change Levy, in real terms, for Q2 2012 to Q2 2014. Image and stats: DECC
A chart of DECC’s Fuel Price Indices, including the Climate Change Levy, in real terms, for Q2 2012 to Q2 2014. Image and stats: DECC

The indices are compiled by DECC from several sources: electricity data from a monthly electricity survey run by DECC; gas data from its in-house monthly Producer Price Index (PPI) gas series; and coal and heavy fuel oil data are taken from its Quarterly Fuels Inquiry (QFI).