Why 'wait and see' isn't an energy procurement strategy

Delaying an energy decision can feel prudent when prices are moving and the winter outlook remains unclear. The logic is (counter)intuitive: wait for the market to settle, then make a decision with better information.

But energy markets rarely move that neatly. Shocks do not usually arrive with a clear warning, and prices can respond before the full scale of an event is understood. By the time the outlook feels more certain, the volatility may already be reflected in the contracts available to businesses.

Waiting is not a neutral position. It can mean accepting whatever the market offers later. That begs the question: will you end up paying a volatility tax?

Different shocks, familiar consequences

In March 2018, the Beast from the East combined extreme cold with unusually high gas demand and supply disruption, placing severe pressure on Britain’s energy system. Four years later, Russia’s invasion of Ukraine intensified the global energy crisis and pushed international prices sharply higher. More recently, renewed conflict in the Middle East sent another shock through global gas markets, driving UK wholesale gas prices up by roughly 75% in Q1 2026.

The triggers were different, but the pattern was familiar. Cold snaps, periods of low wind, shipping or pipeline disruption and geopolitical conflict can all tighten gas markets with little to no warning. Because UK electricity prices remain closely linked to international gas, those movements can quickly affect the prices and terms offered to businesses — as we’ve explored in UK power is still priced by gas. Buyers need new structures.

The lesson is not that businesses should try to predict the next crisis. It is that they are unlikely to receive enough warning to act before the market does.

The cost can linger

It is tempting to assume that waiting allows a temporary price spike to pass. But energy shocks can impact the market long after the immediate disruption has faded from view. Suppliers reassess risk, expectations shift and higher costs can remain embedded in the prices offered to businesses.

That persistence was still visible in late 2024, when average business electricity bills remained 63% higher than in the same period in 2021, before the energy crisis. And the consequences do not stop at the energy bill. Higher costs affect margins, investment decisions and the prices businesses charge their customers. In June 2026, the Bank of England’s Decision Maker Panel found that two-thirds of UK firms expected the latest energy price shock to reduce their profit margins over the following 12 months, while 56% expected to raise prices in response.

This is why waiting for energy markets to return to “normal” can be dangerous. Delaying a decision may simply mean returning to the market later, after the risk has already been priced in.

The renewal window will not wait

Delaying can also narrow the practical options available. Businesses entering negotiations later have less time to compare procurement routes, understand the risks within a contract or respond if the market changes again.

For many businesses renewing around October, the decision must therefore be made before the winter picture comes into view. That does not mean trying to forecast the next disruption. It means considering how the next contract would perform if the market moved against the business.

Businesses cannot control the weather, geopolitics or global gas supply. They can, however, decide how much of that uncertainty will affect their next contract.

Our new white paper, The winter volatility tax hitting British business, explores why waiting for certainty can still leave businesses paying for volatility, and how alternative procurement models can provide greater control.

Download the white paper before making your next renewal decision.

Key takeaways

Why can waiting for the energy market to settle be risky? Prices can react to changing weather, supply and geopolitical tensions before the full scale of a disruption becomes clear.

Do energy costs quickly return to previous levels after a shock? Not necessarily. The effects can remain embedded in contract pricing and business bills long after the immediate event has passed.

What can businesses control? They cannot predict the next market shock, but they can consider how exposed their next energy contract leaves them.

What makes UrbanChain different? UrbanChain’s marketplace directly matches buyers and sellers of renewable energy, protecting you from exposure to the wholesale market with no certificates required. Prices can be agreed in advance, locking in stability and giving greater control. By reducing middlemen involvement and emphasising local matching where possible, UrbanChain keeps costs low, which translates to competitive rates for buyers and sellers alike.