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A Stable Winter Ahead: Insights from TEC’s Winter Energy Outlook

A Stable Winter Ahead: Insights from TEC’s Winter Energy Outlook

Date: October 30, 2025

A Stable Winter Ahead: Insights from TEC’s Winter Energy Outlook

Harrison Miles, Head of Trading and Portfolio Management 

A Stable Winter Ahead: Insights from TEC’s Winter Energy Outlook 

After several years marked by uncertainty, this winter’s energy outlook looks relatively settled. Despite ongoing geopolitical tensions and lower-than-average EU gas storage, several key factors have combined to create one of the most balanced outlooks in recent years. To explore what this means for energy markets – and for TEC members in particular – we caught up with our Head of Trading, Harrison Miles.  Harrison unpicks the key drivers shaping energy supply, wholesale prices, and what to watch for in the months ahead. 

What is the overall outlook of TEC’s Winter Energy Market Update? 

Despite a period of heightened geopolitical risk, the outlook looks relatively comfortable, especially compared to recent years, as prices have gently fallen through October. The NESO and National Gas Winter Outlooks both forecast comfortable margins, but caution remains over prolonged cold or still periods, bolstered by strong global LNG supplies. Of course, in energy markets, things can always change quickly, particularly with the escalation of global events or conflicts.  

Should we be concerned about the relatively low levels of EU storage? 

EU Storage levels have remained at 83% for the duration of October, their lowest level heading into winter since 2021. Despite this, there is currently no cause for concern as prices have remained stable as storage is supplemented by strong global LNG supplies and its ability to fill gaps as and where required. As always, however, if we see extended cold or still weather spells, storage withdrawal rates will increase. This will subsequently increase demand to restock next summer, increasing prices along the forward curve. 

What are the main factors which could impact energy prices this winter? 

The large volumes of LNG that have come online through 2025, and forecast to come online in 2026, have provided a lot of bearish pressure on prices. This could be compounded by the possibility of Donald Trump imposing further tariffs on China, which would suffocate industrial demand for gas. In addition, in late August, China received its first sanctioned shipment of Russian LNG since the start of the Russia/Ukraine conflict. The lack of US response to this has emboldened China to receive more cargoes, with the count now at 11 cargoes delivered. This adds further LNG to an already strong global gas balance, allowing the market to shrug off significant geopolitical tensions and developments over the last quarter, with little price response to Russian incursions into NATO airspace and the Israel/Hamas ceasefire.  

Ahead of winter, a note of caution is always required, as a particularly cold winter or any issues affecting LNG exports could cause prices to start to climb once more. 

Is there any cause for concern from NESO in their Winter Outlook? 

The NESO Winter Outlook painted a cautiously optimistic picture ahead of this winter. The UK continues to cope well with the removal of coal from the fuel mix last year, with de-rated margin, the excess generation available to the grid in a high system stress scenario is forecast to be at its highest since 2019/20 this winter (6.1GW or 10% margin). This reflects the strong growth of batteries and renewables onto the grid in recent years, filling the gap in the fuel mix left by coal and easing any potential tightness in the system over winter.  

What are the main takeaways for TEC members going into winter 2025/2026? 

TEC has a rateable forward buying strategy, which aims to deliver budget certainty and smooth out market volatility. This means that our members are less affected by wild swings in energy costs.  

As focus shifts to Summer 2026, TEC will continue to broadly follow the rateable forward strategy, in the absence of a strong market trend, whilst still accounting and looking to take advantage of the gently bearish nature of recent prices. Summer 2026 is well covered at 77% for power and 73% for gas, with Winter 2026 now at 52% for power and 48% for gas. 

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