Abstract
Introduction
What started as a mortgage market crisis has quickly developed into what may
the most severe recession in a generation. As economies contract, utilities
will see industrial demand weaken. Attempts to mitigate the effects through
tariff reductions are self-defeating in the long run. Utilities are better
served by identifying specific risks within their portfolio and tailoring a
bespoke response.
Scope of this research
- An overview of how the recession is affecting utilities and which of the
EU states are seeing the steepest decline in their gas & power demand.
- A risk analysis model to determine which types of clients are expected to
reduce energy demand and the manner in which that reduction will take place.
- Analysis of individual sectors and performance forecasts; with an overview
of how each sector is expected to perform.
- A set of strategies to mitigate the effects of the downturn on their
revenue streams - what utilties should look for when shaping their portfolio.
Research and analysis highlights
B2B gas and power demand is contracting across Europe. For the first time
since WW2 we are witnessing a global contraction in trade and production. The
impact this is having on B2B energy demand varies across the EU. So far
Eastern Europe is seeing the sharpest contraction, on account of high energy
intensity levels and reliance on heavy industry.
Utilities operating in B2B markets face four essential demand side risks as a
result of the recession. These can be segmented into Volume and Credit risks,
revealing not only the scale of the problem but the nature in which demand
contraction is likely to manifest itself.
Utilities are not powerless to act; a range of weapons can be deployed to
minimise the threats to revenue arising from B2B demand contraction. Utilities
must augment their view of risk profiling to cater for the specific challenegs
their clients are facing.
Key reasons to purchase this research
- Understand the implications of the downturn for the European gas and power
industry.
- Develop innovative client profiling and risk management techniques.
- Plan your strategy to not only survive the recession but to exploit the
range of opportunities which the downturn presents.
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