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British Gas recorded a 15% decline in electricity demand among UK business due to Covid 19 and more strike action on the way

Richard Simmonds • January 18, 2021

According to British Gas owner Centrica, the Covid-19 pandemic caused a 15% decline in electricity demand amongst the UK's businesses. With lockdown three underway demand is forecast to remain lower than seen in other years.

Continued pressure

Centrica has warned of more pressure to come on energy demand as the government takes stricter enforcement measures over the latest lockdown. Businesses have been forced to close with employees expected to work from home if they are able.

Despite the concerns caused by the pandemic Centrica said it remains cautious about 2021.

The UK economy is expected to suffer from a double-dip recession due to the latest restrictions. National GDP in November was down 8.5% below pre-pandemic levels.

"The sharp GDP fall in November as England entered its second national lockdown suggests that the UK is in the midst of a double-dip recession as it starts the year with even stricter restrictions. But while the economic story today is of only the second-ever double-dip recession on record, the story of the year will be a vaccine-driven bounce back in economic activity for sectors like hospitality and leisure," said James Smith, research director of the Resolution Foundation.

Many have experienced the economic difficulties that have led to an increase in consumers struggling to pay their energy bills. If the restrictions continue throughout the year, more and more businesses are expected to struggle to pay their energy bills.

The company also reported that it had seen relatively little change in its customer numbers, ending 2020 with 6.9 million UK energy supply customers. 


Striking workers

British Gas is also under pressure from the trade union GMB who announced that another round of five one-day strikes would occur due to the company's fire and rehire strategy.


Last year, Centrica announced that it would slash 5,000 jobs to restructure and modernise the company.


However, a month after that announcement, it was revealed that British Gas planned to fire and rehire its entire 20,000 workforce unless they agreed to new pay and work conditions. The GMB union claims that British Gas is using fire and rehire tactics to cut workers' pay.


Last week 7,000 employees went on five days of strike action, and another round of one-day strikes is due to start on Wednesday, January 20. The other strike days are Friday, January 22, Monday, January 25, Friday, January 29 and Monday, February 1.


British Gas managing director Matthew Bateman meanwhile has been heavily criticised by strikers for what they claim is him 'celebrating the pandemic'.


A leaked video clip from a conference call Bateman can be seen talking about the "relatively low coverage" the strike by engineers over new contracts pay, and conditions have been getting due to the Covid-19 pandemic.


Despite the challenges the company has faced, British Gas said that its 2020 profits would be higher than expected as it cut costs at the energy supplier.

Further Reading

Energy Suppliers under pressure to step up Smart Meter rollout in 2021- How not to alienate customers


What does 2021 hold for the UK Energy Market?


How should Energy Suppliers explain Energy Bill Increases?


Dyball Associates are proud to help new supply businesses successfully launch in the UK market.

 

Through our energy market consultancy services, and the software we've developed, we're supporting new UK electricity and gas suppliers get set up and start supplying.


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