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Highlights
- A survey shows over one million small businesses currently pay significantly higher energy bills.
- According to the survey, around a quarter of the UK's 5.5 million small businesses are exploring renewing their long-term energy supply contracts.
- An FSB survey further adds that 24% of small businesses were on fixed deals, with many on the verge of missing their payments.
Medium to small businesses in the United Kingdom are feeling the heat of the exorbitant energy tariffs in the country. According to a survey by the British Chamber of Commerce (BCC) and the Federation of Small Businesses (FSB), over one million small businesses currently pay significantly higher energy bills. These rates are currently well above the existing market rates, and these small businesses are feeling the brunt of it as they are getting trapped in long-term contracts.
According to the survey, around a quarter of the UK's 5.5 million small businesses are exploring renewing their long-term energy supply contracts. The businesses are now urging ministers to renegotiate unaffordable energy deals.
The UK energy prices peaked at 54% in April last year and reached a maximum of 80% by October later that year. But Energy Price Guarantee had reduced the burden for a few, but now, many businesses are struggling with its end. Many small companies preferred to go in for long-term contracts during the price rises in anticipation of further rises. But since then, market prices have fallen, and on 1 April, the government cut its financial support for businesses. However, many are forced to pay inflated prices with the firms still locked in long-term contracts.
Even the energy regulator Ofgem had expressed concern over some of the energy suppliers over the pricing. Ofgem had, in fact, written a letter to Jeremy Hunt had written that the energy bills were much higher than expected. In many cases, the suppliers and brokers often force the consumers to pay much higher deposits and standing charges. An FSB survey further adds that 24% of small businesses were on fixed deals, with many on the verge of missing their payments.
Amid this, let's explore some of the energy stocks the Brits can keep a keen eye on.
Energean plc (LON:ENOG)
Energean plc is an oil, gas and coal exploration organisation centred around the eastern Mediterranean and the UK North Sea. The London-based firm recently announced its pre-tax profit report of US$107.0 million in 2022 from a loss of US90.7 million in 2021.
Energean plc, on 18 April, boasted of a market cap of £2,313.67 million and were trading at GBX 1,287.00 at 9.22 AM (BST) on Monday. Energean plc shares had given its investors returns of 4.04% annually and -1.68% on a YTD basis. However, the company's earnings per share are negative, at -0.54.
Diversified Energy Company plc (LON:DEC)
The shares of the US-based oil and gas firm, Diversified Energy Company plc, witnessed a fall by 0.48% and were trading at GBX 93.00. DEC enjoyed a market cap of £ 907.78 million with an EPS of -0.41. The FTSE-250 constituent has given its shareholders negative returns of -20.06% and -20.13 on YTD and an annual basis.
Shell plc (LON:SHEL)
The oil and gas producing giant Shell plc's shares surged by 0.31% on 18 April, trading at GBX 2,462.50. With a market cap of £ 168,156.69 million, Shell plc has a positive EPS of 5.76. The FTSE 100 index constituent has given its shareholders positive returns of 5.88% and 12.41% on YTD and annual basis.
