Profit Warnings focus on sectors Q3 2021: Energy

2 minute read 18 Oct 2021
By Rob Doepel

EY UK&I Managing Partner for Sustainability; EY UK&I Climate Change and Sustainability Services Leader

Dedicated to driving a sustainable future. Enables organisations to thrive in a net zero economy. Born and raised in Australia.

Contributors
2 minute read 18 Oct 2021
Related topics Strategy and Transactions

A huge ramp up in post-pandemic demand and supply disruptions have pushed gas prices to record levels.

Issues in the retail energy sector underline the challenge ahead. Wind power contributed less than 10% of the UK’s energy supply in summer 2021, compared with 25% in 2020.  Natural gas has filled the gap – but at a cost. Since January 2021, prices have risen by 250% and they’re up by 70% since August alone.

Record high natural gas prices have disproportionately affected smaller retail energy companies whose business models are primarily based on low-value-add electricity and gas supply.

Ultimately the future of retail energy supply will lie in a higher-value, service-oriented offering focused on sustainable power. But the challenge of energy transition highlighted here is also playing out elsewhere. This example highlights the importance of companies having visibility and understanding of market trends – as well as the agility to react and time their investments. 

Register to download our Profit Warnings Q3 2021 report

Summary

Every quarter, we provide the latest sector insights from our Profit Warnings analysis, delving deep into two specific sectors and the challenges facing companies and stakeholders alike.  

For Q3 2021, we look at the Retail sector along with Energy, analysing the headwinds facing both.

About this article

By Rob Doepel

EY UK&I Managing Partner for Sustainability; EY UK&I Climate Change and Sustainability Services Leader

Dedicated to driving a sustainable future. Enables organisations to thrive in a net zero economy. Born and raised in Australia.

Contributors
Related topics Strategy and Transactions