Energy Prices

[Lurkst]

https://www.bbc.co.uk/news/av/uk-62685284

 

[beefybake]

11 hours ago, welshbairn said:

I really don't think the forecasted horror prices for years to come will come to pass, much of the increase is artificial, like North Sea wind generated electricity being based on the price of Russian gas which is ridiculous. We actually import zero gas and oil from Russia. And the Government have an election coming up in the next couple of years so they can't afford to have all the care homes closing down, small businesses closing and people freezing to death. If you get into serious shit I'd ask for a contribution sabbatical rather closing down your insurance and pension.

They weren't too bothered about the people in care homes during Covid.

[beefybake]

1 hour ago, Detournement said:

Russia also didn't want to change from long term fixed price contracts. It was the EU who demanded spot pricing.

Perhaps so. It is though completely irrelevant in a scenario where demands are made to pay in a different currency,  supplies being cut

due to so-called 'routine maintenance'  etc etc...

[welshbairn]

1 hour ago, Todd_is_God said:

It was more to try to get across to Welshy to stop wittering on about the price of Russian gas as if sourcing it from elsewhere would make everything cheaper for everyone.

I genuinely think he believes that the price of gas from Russia is more expensive than gas from other places.

I'm well aware of global pricing, my point is that we shouldn't be paying it for gas from fields we control, let alone for electricity from wind.

Edited August 27, 2022 by welshbairn

[Todd_is_God]

14 minutes ago, welshbairn said:

I'm well aware of global pricing, my point is that we shouldn't be paying it for gas from fields we control, let alone for electricity from wind.

We don't control them, though. We sold them off. There is no compulsion for north sea gas to be sold within the UK. That means when we buy it it needs to be at the market rate or else someone else will buy it.

The control we do have, is to apply a windfall tax on the profits from selling north sea gas, and use that money to lower end user bills.

It's not a long term solution, though, as it won't increase the amount of gas available on the market, which in turn will keep that wholesale price high. 

The point about the merit order is absolutely valid, though, and is a genuine option that almost certainly will change. It's not going to happen overnight, though, not least because of things like privatised wind farms. And no, nationalising them is not a viable solution.

Edited August 27, 2022 by Todd_is_God

[welshbairn]

17 minutes ago, Todd_is_God said:

There is no compulsion for north sea gas to be sold within the UK.

There is when most of the infrastructure like pipelines and pumping stations in our sector are for UK supply. In the short to medium term they have no alternative, and if they turn off the taps we can take steps up to nationalisation to force them back on. A full windfall tax would achieve much the same, but so far the proposals have been lame in the extreme, and rejected by both PM candidates.

Edited August 27, 2022 by welshbairn

[Todd_is_God]

8 minutes ago, welshbairn said:

There is when most of the infrastructure like pipelines and pumping stations in our sector are for UK supply. In the short to medium term they have no alternative, and if they turn off the taps we can take steps up to nationalisation to force them back on.

There really, really isn't, and going down this line of argument is just nonsensical.

Out of interest, what do you think it would cost to nationalise the north sea oil fields?

[Bairnardo]

North Sea oil and gas companies are already compelled to produce. You don't have to nationalise on that basis. Part of the licence to operate is that you produce. They can't sit on it till theyike the price better. Likewise the granting of exploration blocks. Use it or lose it.

[welshbairn]

3 minutes ago, Todd_is_God said:

There really, really isn't, and going down this line of argument is just nonsensical.

Out of interest, what do you think it would cost to nationalise the north sea oil fields?

Temporary sequestration at a time of national emergency might do it. Alternatively they could just accept a temporary price cap at a level at which they happily supplied last year, maybe with a small bonus for their trouble.

[Todd_is_God]

5 minutes ago, Bairnardo said:

North Sea oil and gas companies are already compelled to produce. You don't have to nationalise on that basis. Part of the licence to operate is that you produce. They can't sit on it till theyike the price better. Likewise the granting of exploration blocks. Use it or lose it.

But they aren't compelled to sell it within the UK. They would have no problem at all selling it in Europe at market value should the UK Gov try to cap the price they can sell it here.

8 minutes ago, welshbairn said:

Temporary sequestration at a time of national emergency might do it. Alternatively they could just accept a temporary price cap at a level at which they happily supplied last year, maybe with a small bonus for their trouble.

As I thought, you think it's free / buttons.

[ParsJake]

12 hours ago, TxRover said:

Average human body is 125,822 (https://www.smithsonianmag.com/smart-news/ancient-cannibals-did-not-eat-humans-nutrition-study-says-180962823/), but as the average Tory is likely a wee bit chunkier…

They're not wrong, y'know...

[strichener]

1 hour ago, Todd_is_God said:

There really, really isn't, and going down this line of argument is just nonsensical.

Out of interest, what do you think it would cost to nationalise the north sea oil fields?

I think what COVID showed was that regardless of accepted norms, the government can and does do whatever it wants.

Government pressure on oil companies could be the threat of revoking their licence, taxing them at over 100% of profit or many other persuasions.  It isn't like they can take the assets and move them abroad.

They also don't have to nationalise the companies, just the transportation infrastructure.

Edited August 27, 2022 by strichener

[Shadow Play]

1 minute ago, strichener said:

I think what COVID showed was that regardless of accepted norms, the government can and does do whatever it wants.

Government pressure on oil companies could be the threat of revoking their licence, taxing them at over 100% of profit or many other persuasions.  It isn't like they can take the assets and move them abroad.

But it could very well stop them and other companies ever investing in the UK again.

There are countries out there where you can legally pay your employee virtually  pennies yet companies chose not to invest in those countries for very good reasons.  

I’m not criticising your opinion as I honestly don’t know what the answer is.  I’m just trying to point out that there really doesn’t appear to be any easy short to medium term solutions that don’t in themselves create other medium to long term problems.
 

 

[Todd_is_God]

52 minutes ago, strichener said:

I think what COVID showed was that regardless of accepted norms, the government can and does do whatever it wants.

Government pressure on oil companies could be the threat of revoking their licence, taxing them at over 100% of profit or many other persuasions.  It isn't like they can take the assets and move them abroad.

They also don't have to nationalise the companies, just the transportation infrastructure.

Of course they can. If the UK Gov get wanky with them they could simply change the infrastructure to condense 100% of the gas to LNG and sell it all abroad. There would be plenty ways as well to make sure the profits that could be taxed in the UK were zero.

"Simply" is not accurate of course but it wouldn't be impossible.

The challenge for the UK Gov is, as Shadow Play alluded to, to find a solution to a short-term problem that does not have drastic and damaging long-term consequences.

Edited August 27, 2022 by Todd_is_God

[Gaz]

4 hours ago, 101 said:

Wear a bib when your eating, to stop you spilling stuff down your front?

Cool, will just tell my disabled kids that. Wish we'd thought of telling them that before!

[carpetmonster]

1 hour ago, ParsJake said:

They're not wrong, y'know...

Is the watermark the name of the photographer or where Eric gets put in the Tory filing system?

[Gaz]

25 minutes ago, oaksoft said:

No need for that FFS.

101 was clearly making a joke.

Yeah, no in hindsight you're absolutely right.

Apologies @101 - obviously a touchy subject but you weren't to know.

[101]

1 hour ago, Gaz said:

Yeah, no in hindsight you're absolutely right.

Apologies @101 - obviously a touchy subject but you weren't to know.

Sorry mate! Yeh poor one from me. 

[strichener]

2 hours ago, Todd_is_God said:

Of course they can. If the UK Gov get wanky with them they could simply change the infrastructure to condense 100% of the gas to LNG and sell it all abroad. There would be plenty ways as well to make sure the profits that could be taxed in the UK were zero.

"Simply" is not accurate of course but it wouldn't be impossible.

The challenge for the UK Gov is, as Shadow Play alluded to, to find a solution to a short-term problem that does not have drastic and damaging long-term consequences.

Lol what?  How do they build the infrastructure to do this in the North Sea?  The government already have the legislation in place that could block this in the National Security and Investments Act.  I'm not saying that they wouldn't want to try to find a way round this but we are not precluding these companies from making a profit just not at the expense of the nation that owns the resources.

Ultimately this is not going to create  long term problems as we should be looking at national investment in energy security and not privatisation of critical infrastructure and natural resources and oil any gas companies are not the ones that are going to lead our energy transition no matter what they say publicly.

[strichener]

3 hours ago, Shadow Play said:

But it could very well stop them and other companies ever investing in the UK again.

There are countries out there where you can legally pay your employee virtually  pennies yet companies chose not to invest in those countries for very good reasons.  

I’m not criticising your opinion as I honestly don’t know what the answer is.  I’m just trying to point out that there really doesn’t appear to be any easy short to medium term solutions that don’t in themselves create other medium to long term problems.
 

 

These companies invest in areas that are far more volatile than the UK.  They will continue to do so as long as they can see profit for shareholders.