Moody's rating agency says UK blackout concerns will be short-lived

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The wholesale price of electricity should remain at a similar figure in the future,  in spite of warnings about probable increases in prices as the UK faces the prospect of an energy blackout, a leading rating agency has suggested.

Moody's rating agency has suggested an improvement in energy efficiency, better insulated houses and the creation of new offshore wind farms will all play a part in keeping prices at a similar level, despite many expecting a period of steady rises in retail prices.

Moody's vice president and senior analyst, Scott Phillips, said: "We believe that widely expected tightness will be short-lived as energy efficiency gains, the rollout of offshore wind power and the return of mothballed gas plants will keep prices in check.

"Our view is that power prices will stay around current levels, or £48-53 per megawatt hour, through the end of the decade."

Concerns of a UK blackout, which has been a topic continually raised by many industry experts over the last year or so, and even revisited again by the energy regulator Ofgem earlier this week, should not be a cause of  too much concern according to the rating agency.

While Ofgem has suggested there may be an outside chance of dimming lights while National Grid compensates for supply and demand, Moody's has suggested the energy crunch will be temporary at most, and energy capacity margins can expect to reach as much as 20% by 2020.

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