Opening up the Wholesale Gas Market to Thousands of UK Businesses
Leeds, UK, 24 September 2014 – Business energy supplier Vayu today launched a new gas product allowing mid-sized gas users* to take advantage of cheaper prices available in the wholesale gas markets. A first of its kind for the UK market, the Vayu Energy Smart opens the wholesale gas market up to thousands of businesses throughout the country, allowing them to purchase gas on more equal terms to much larger businesses.
The product gives gas users transparent and straightforward access to day-ahead prices based on the System Margin Price (SMP) index, which has been on average 20% cheaper than the fixed market this year. At any time during the contract, businesses will have the added security of being able to ‘lock in’ the balance of their remaining contract or winter consumption at prevailing live prices.
Simon Firth, Head of Energy Services at Vayu, says: “Since entering the UK gas market earlier this year, our focus has been on creating a flexibility for users that has not traditionally been available in the UK market. This new product is one example of how we plan to achieve this, removing a significant barrier faced by mid-sized gas users in the UK which, like all businesses, are coming under increasing pressures to reduce costs.”
“With SMP prices trading significantly lower than the fixed market this year, there’s a clear opportunity for businesses to gain access to much more competitive prices. Larger energy users have achieved great results by taking advantage of this product to achieve the best possible price in the market, so our aim is to now provide access to wholesale markets for all users.
Mr Firth notes that there is enormous untapped opportunity to deliver new services into the UK gas market, targetting mid-sized users as well as industrial and commercial customers. He says: “As today’s announcement shows, we are investing heavily in winning customers by changing the way UK businesses view their energy-related decisions and empowering customers to take a more hands on approach to energy procurement.”
Vayu has grown steadily since 2003, when it became the first independent supplier to be awarded a gas shipping and supply license in Ireland. The company now supplies 22% of Ireland’s largest natural gas business customers and 15% of the mid-sized gas user segment. Gas customers include companies such as Tesco, IBM, Debenhams and DHL.
In June this year, Vayu entered the UK business gas market, which is valued at over £7 billion per annum. The company is focussed on becoming a leading provider of gas and energy procurement solutions to businesses across the UK, giving customers a competitive alternative to other suppliers in the sector.
*This product is typically suited to businesses with a daily gas consumption in excess of 500 therms.