Business Outlook 2022

Energy Trends

UK ENERGY SYSTEMS REMAIN RELIANT ON FOSSIL FUELS with oil and gas providing 75% of UK energy. These trends will evolve as lower carbon energy capacities grow but oil and gas will remain important for the foreseeable future.

COMMODITY PRICES HAVE RISEN SHARPLY first following the recovery from Covid and now with the war in Ukraine.

ENERGY PRICES ARE CONTRIBUTING TOWARDS SIGNIFICANT INFLATIONARY PRESSURES across the economy and there are no easy and quick fixes to this.

A STRATEGIC APPROACH TOWARDS THE DEVELOPMENT OF A DIVERSE AND LOWER CARBON ENERGY SYSTEM is crucial for energy security, affordability and reduced emissions.

UK Energy Landscape – Present & Future

levels continued to be influenced by the impact of Covid restrictions. Importantly the long-term downward trend has been achieved alongside continued growth in the UK economy, with gross domestic product (GDP) increasing by 34% since 2000, in real terms – meaning that the economy is becoming less energy intensive. Although some uncertainties persist concerning the forward trend for energy consumption post-Covid, it is likely that this year’s demand will return to 2019 levels and then the long-term downward trajectory will continue. Oil and gas supplied three quarters of

Current Energy Use UK energy demand has been falling for a long time, owing to the continued shifting nature of the UK economy towards services, and improvements in energy efficiency. The UK used just over 169mn metric tons of oil equivalent (mtoe) in 2021. This was 4% more than 2020 but 8% less than 2019, reflecting the ongoing economic recovery from Covid restrictions. Energy use was 28% lower last year than in 2000, although

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BUSINESS OUTLOOK 2022