The energy markets in Great Britain and Europe are facing unprecedented changes. With the fallout from geopolitical conflicts, the push for decarbonisation, and fluctuating demand patterns, businesses must prepare for a volatile 2025. Navigating these challenges requires not just an understanding of the risks, but also strategic approaches to procurement and energy management.

This blog explores the key risks facing energy buyers in 2025 and offers actionable strategies to mitigate them.

1. Geopolitical Uncertainty

The Russian invasion of Ukraine continues to reshape the energy market as the conflict nears its third year. In order to secure alternatives to Russian gas, Liquefied Natural Gas (LNG) has become the backbone of European gas supply, but global competition for LNG remains fierce. Furthermore, the evolving tensions in the Middle East bring the threat of additional disruption to global oil supply and key supply routes. Any political policy changes could also be significant, with the new Trump administration in the United States and its pro-fossil fuel agenda of note.

Recent years have demonstrated the fragilities of the global energy system to geopolitical factors, and both instability and uncertainty abound as we enter 2025.

2. Price Volatility

The increasing role of renewables and gas-fired power generation in balancing supply creates price unpredictability. LNG prices are influenced by global benchmarks such as the Henry Hub in the U.S. and the Japan-Korea Marker (JKM) in Asia, which react to economic and climatic shifts.

Furthermore, as renewables replace fossil fuels in electricity generation, the intermittency of sources like wind and solar requires that gas plants meet demand when renewables cannot, leading to price volatility near delivery times.

Unlock the Key Insights: Energy Market Trends for 2025

Prepare for the future with Optimised Insights: Long-Term Energy Market Trends 2025, a concise analysis of energy markets in Great Britain and Europe.

This report highlights supply, demand, regulation, and decarbonisation trends for energy buyers and decision-makers.

• Understand how global events disrupt supply chains and markets.
• Explore the rise of LNG and its impact on pricing and competition.
• Learn about GB’s 2030 renewable energy targets.
• Discover strategies to manage risks and leverage opportunities.
• Gain insights into pricing, demand, and regulatory impacts.

3. Regulatory Changes

Government mandates for more flexible energy consumption and changes to market design mean buyers must adapt to new cost structures.

For example, it is anticipated that the British government will make a decision on the implementation of zonal pricing in the first half of 2025 as part of its Review of Electricity Market Arrangements (REMA). This would carve up Great Britain into around a dozen trading areas within which electricity prices would vary to reflect the cost to produce and supply energy in that area. This is likely to result in low prices in areas such as Scotland where renewable supply is in abundance and consumption low, but higher prices in areas like the South East. It is hoped this will mitigate grid constraints and incentivise new renewable power plants in high-demand regions. If it goes ahead, it will certainly have an impact on energy procurement.

4. Supply Chain Challenges

Aging infrastructure, increased reliance on imports, and the growing integration of renewables mean that supply chain issues could lead to sudden spikes in energy costs.



For example, European energy infrastructure is aging, with around 40% of its distribution grids over 40 years old. An aging grid poses risks to supply at a time when cross-border transmission capacity is due to double by 2030 and networks urgently need to modernise to accommodate the transition to renewable sources of energy.

1. Adopt Flexible Procurement Models

Moving beyond traditional fixed contracts to include flexible purchasing strategies will be crucial. By combining long-term hedging with short-term market purchases, businesses can take advantage of price dips while maintaining budget certainty.

2. Embrace Energy Storage Solutions

Investing in energy storage is a potential opportunity for businesses. Battery storage systems allow companies to store energy during low-cost periods to use when prices peak. This not only mitigates price volatility but also supports grid stability and potentially provides energy security and reliability for businesses.

3. Collaborate with Experts

Working with experienced energy consultants, like Optimised’s trading and risk management teams, can help businesses tailor strategies to their specific needs and market conditions.

4. Monitor Market Dynamics

Stay informed about geopolitical and economic developments and how these influence energy prices. Use real-time data and market reports to make proactive adjustments. Energy market experts, like Optimised, can provide access to and analysis of this data. This can protect energy procurers, their businesses (and by extension, their customers), as much as possible from the volatilities of the energy market.

Energy markets in 2025 will demand agility and foresight from buyers. By understanding the risks and implementing strategic solutions, businesses can turn challenges into opportunities. As volatility increases, those who adapt their procurement and consumption strategies will gain a competitive edge.

Ready to secure your energy strategy for 2025? Navigating the energy market can be overwhelming, but our energy procurement services make it simple. Book a 30-minute consultation to explore tailored solutions for your business.

For a more in-depth analysis of the Energy Market and its current outlook, access our Long Term Energy Market Trends 2025 report here.

Article by Magnus Walker