At last week's British Tomato Conference, Chris Placket of FEC presented his annual review to show what is happening in the UK energy sector price-wise. Beside market updates, Placket also gave an update on the chances and opportunities in regards to governmental changes, rebate schemes and subsidies.

Oil price

Placket said that the oil price is no longer driving a British greenhouse grower's cost of energy. "As known, the crude oil prices crashed as there is far more supply than demand. However, last week the OPEC agreed to cut production which immediately generated a 5% increase in price again. Unless any unforeseen political circumstances happen, the price of crude oil is not expected to make a drastic increase."

Natural gas stable

In regards to natural gas, Placket explained that the last twelve months saw good day ahead prices, which have come down quite well. “Again same story; there is plenty of gas and LNG available. The only spike in the price of natural gas was generated by the Brexit’s change of exchange rates. Looking forward, the biggest threats for the price of natural gas will remain the exchange rates and for the next 2-3 years nothing scary is expected”.

Furthermore, Placket discussed the end of various subsidized renewables. The end on these are not just a fallout of the Brexit vote, because the budget caps were in place pre-referendum.

Yet, the CHP still has a bright future in the UK glasshouse industry, even though it is no longer as heavily subsidized. "CHP still has a place, especially within a practical strategy. It can be very interesting if you take full advantage of all the possibilities that there are", concluded Placket