Energy Prices

[Detournement]

This headline is our future. 

 

[Clown Job]

If it hasn’t hit you yet that we are fucked 

 

Edited May 16, 2022 by Clown Job

[Gordon EF]

On 10/05/2022 at 19:03, Brother Blades said:

Maybe someone cleverer than me or at least more in the know could answer this?

I can understand the rise in gas prices due to global prices, however, when Scotlands electrical energy is nearly 100% renewable, why have electricity prices risen as much as they have? I’m expecting money grabbing by the energy companies to be the answer, but I may be wrong. 
Also, would it be possible for legislation to be passed to limit dividends being paid to energy company shareholders & the monies diverted to public funds? 

The generation of and selling and buying of energy is UK wide. It's all the same market. So a wind farm or hydro plant in Scotland sells it's energy in the same market as a gas generator in England.

The markets where producers sell energy to suppliers (who then sell it on to consumers) are all the same, they don't really differentiate between how the energy is produced. Since gas is still such a big part in the UK's energy, it's effectively the price setting fuel. If suppliers need to buy 100 GWh of energy then the price of that 100th GWh effectively sets the price. When gas prices are cheap, gas can sit near the bottom of the price ladder and renewables can set the price and they have to be competitive to sell. When gas is expensive, because it's so big, it sits much further up the ladder and has to set the price high because generators can't sell energy for less than it costs to buy the gas to produce it. All the non-gas generators are essentially coining it in because they can.

[s_dog]

In addition to Clown Job's post above, listen to Martin Lewis from just after 3 minutes for exactly why OFGEM is making sure we're all fucked from more than just high prices.

[jagfox]

 

 

 

 

[vikingTON]

On 11/05/2022 at 08:52, 101 said:

A big jump in the price of electricity is also down to OfGem wacking and standing charge up.

They say they did this because it cost them a lot of money to switch people over when the energy companies went bust.

Yes we are paying for energy companies to increase their customer base when it's just about impossible to leave and you have no say over who you went too. That should absolutely be paid for by the energy companies, not the consumers.

Which energy companies? The dozens of them that did a Rangers after setting up ridiculous price packages are not going to cough up for that cost because they don't exist anymore. 

Unless you want millions of people to be cut off from their energy supplies whenever a tinpot energy company goes tits up then someone is going to have to pay the costs of taking on extra demand at zero notice. And whether you 'make (surviving) energy companies pay' or not, the costs will ultimately filter down the consumer in this market.

'Don't let a stack of Walter Mitty outfits run an essential utility' is the lesson but there's no getting round the mess that has created. 

[Jacksgranda]

On 10/05/2022 at 09:02, Bairnardo said:

At what point do you move from "you have too much money, you need to pay more to subsidise others" to "you have too much money but for the sake of a free market, we must protect your right to have all that money". 

 

Interested in where the transition happens. 

 

Anyway, that's my local garage now got diesel back up at the pre duty cut peak. 

 

Nice one Rishi, really doing it for the little guy there. p***k. 

Most filling stations round here seem to be at 179.9p/litre for diesel, and that hasn't changed in weeks.

[Left Back]

16 hours ago, s_dog said:

In addition to Clown Job's post above, listen to Martin Lewis from just after 3 minutes for exactly why OFGEM is making sure we're all fucked from more than just high prices.

Except for the fact we aren't.

The market stabilisation charge is designed to be a temporary measure that will expire (presumably when the markets get back to some normality.

https://www.ofgem.gov.uk/publications/market-stabilisation-charge-dashboard

Short term we're fucked and there will be no decent switching deals but there wouldn't have been any regardless of whether the MSC was in place (or if it does get changed to the proposed 10% trigger/85% charge).  It may be that it does get extended post September if the market still hasn't started to normalise but it won't be a long term policy as that would create a pricing cartel which the CMA wouldn't stand for.

[DA Baracus]

1 hour ago, jagfox said:

 

 

 

 

A huge mystery here. I do wonder what is driving the ludicrous prices...

[jagfox]

31 minutes ago, DA Baracus said:

A huge mystery here. I do wonder what is driving the ludicrous prices...

I don't think you read the thread tbh.

[s_dog]

1 hour ago, Left Back said:

Except for the fact we aren't.

The market stabilisation charge is designed to be a temporary measure that will expire (presumably when the markets get back to some normality.

https://www.ofgem.gov.uk/publications/market-stabilisation-charge-dashboard

Short term we're fucked and there will be no decent switching deals but there wouldn't have been any regardless of whether the MSC was in place (or if it does get changed to the proposed 10% trigger/85% charge).  It may be that it does get extended post September if the market still hasn't started to normalise but it won't be a long term policy as that would create a pricing cartel which the CMA wouldn't stand for.

So you disagree but basically, aye we're fucked you mean, just maybe not forever when no one said anything about the length of time.

OFGEM are making changes that do everything to protect the suppliers, and nothing for consumers. It's immaterial how long it's for, they are restricting competition by making it cost suppliers more to charge consumers less. They are even trying to sell the 3-month price cap review as a way to also drop prices as well as raise prices more often, ignoring the fact that it's a price cap, and there is nothing to stop suppliers charging less than the price cap whenever they want.

Edited May 17, 2022 by s_dog

[strichener]

1 hour ago, Left Back said:

Except for the fact we aren't.

The market stabilisation charge is designed to be a temporary measure that will expire (presumably when the markets get back to some normality.

https://www.ofgem.gov.uk/publications/market-stabilisation-charge-dashboard

Short term we're fucked and there will be no decent switching deals but there wouldn't have been any regardless of whether the MSC was in place (or if it does get changed to the proposed 10% trigger/85% charge).  It may be that it does get extended post September if the market still hasn't started to normalise but it won't be a long term policy as that would create a pricing cartel which the CMA wouldn't stand for.

How can the market stabalise when the regulator is putting obstacles in the way of competition?

[Left Back]

19 minutes ago, strichener said:

How can the market stabalise when the regulator is putting obstacles in the way of competition?

Which are due to expire at the end of September.  I'd doubt there would have been any cheaper energy in that timeframe regardless.

[Detournement]

2 hours ago, jagfox said:

I don't think you read the thread tbh.

The thread tells you that the price we are paying just now is based off the futures market which is set to whatever price BlackRock, Vanguard, Blackstone want. 

So as long as the big players in the futures market want it this way prices can continue to rise without any change in supply or demand. It's a huge scam to reduce the purchasing power of the bottom 90% of households. 

[DA Baracus]

I'm absolutely certain that prices will go down to the levels of last year again. It will definitely, categorically happen. 

Edited May 17, 2022 by DA Baracus

[strichener]

2 hours ago, Left Back said:

Which are due to expire at the end of September.  I'd doubt there would have been any cheaper energy in that timeframe regardless.

That's the point though, OFGEM are going to extend it, they have already proposed March 2023.

The MSC is not in the consumer interest as it encourages companies to forward purchase their entire energy demand.  When you are both a generator and a retailer, there is an incentive to sell your production to the retail business at the highest level possible when Ofgem are basically ensuring that this is underwritten by anyone that wants to entice your customers.

[Left Back]

18 minutes ago, strichener said:

That's the point though, OFGEM are going to extend it, they have already proposed March 2023.

The MSC is not in the consumer interest as it encourages companies to forward purchase their entire energy demand.  When you are both a generator and a retailer, there is an incentive to sell your production to the retail business at the highest level possible when Ofgem are basically ensuring that this is underwritten by anyone that wants to entice your customers.

I agree it's not in the consumer interest were it to remain in place long term.  In a normal market where cheaper switches were available this would be a disgrace.  In the market is it stands at the moment it's an irrelevance because there is no real competition and no-one is switching.  If the market starts to normalise and this remains in place that's the time to be up in arms about it.

[strichener]

1 hour ago, Left Back said:

I agree it's not in the consumer interest were it to remain in place long term.  In a normal market where cheaper switches were available this would be a disgrace.  In the market is it stands at the moment it's an irrelevance because there is no real competition and no-one is switching.  If the market starts to normalise and this remains in place that's the time to be up in arms about it.

You may be missing the point, the MSC itself stops there being a competitive market.  Unless of course you believe that all the large generators such.as Eon, SP etc. are all losing money.  Here is an extract from Scottish Power's accounts from the period ending Dec'21 when they were all shouting about how bad they had it.

[Left Back]

46 minutes ago, strichener said:

You may be missing the point, the MSC itself stops there being a competitive market.  Unless of course you believe that all the large generators such.as Eon, SP etc. are all losing money.  Here is an extract from Scottish Power's accounts from the period ending Dec'21 when they were all shouting about how bad they had it.

I’m not missing the point at all.  With or without the MSC there is no current competitive market.  As I’ve said the time to get upset about this is not now.  It makes zero difference to consumers or prices.  When gas costs drop is the time to get upset.  I’m under no illusion the generators aren’t trying to lock in wholesale costs as high as they can for as long as they can.  That is a far cry from the Martin Lewis outrage that was quoted on here with the statement we’re all fucked.

When gas prices fall the price cap will fall.  Yes its dodgy the move to 3 monthly reviews doing a 6 month look back.  Yes the proposed changes to MSC are shite and are in the interests of the generators and not the consumer.

It does not mean we are long term fucked though.  The MSC won’t be in place long term which the likes of ML haven’t mentioned.

[Bairnardo]

FWIW, Nat gas took a significant dip last weekend. I know not what caused it, or how long it will last, but it did.