Gas/Electricity Price Increases

[LeMarchand]

What else can they do

 

My answer to that would lead the topic into forbidden territory...

[mavhc]

I read (somewhere) that the cost of the domestic bung to the energy sector would have built enough wind turbines to power the entire country. Don't know how accurate that is...

 

But not by November.

 

$2858 per kW to install offshore wind.

 

Total energy usage in uk 1651 TWh, that's 188 GW average. (Total energy, not just electricity). Once you switch vehicles to EVs that sector will drop in usage, same with heat pumps.

 

That much energy as wind power would cost £474 billion, so it's in the right range of the £150 billion it's expected to cost.

 

Petrol car may be 50 mpg, ev is more like 300.

 

Transport and Domestic use are about equal, and twice that of Industry and Services. So let's say the 36% that is transport is cut in 3, and half of domestic is heating, and that's cut in 3. So a drop of 24% for transport and 12% for heating, 36% drop in total energy usage. Which would give £300 billion.

 

Not sure if that number if average kw or max though.

[Ditto]

My answer to that would lead the topic into forbidden territory...

 

I think it got there already... banner coming before too long if it continues.

[steveg]

Govt announce more propping up of energy companies profits.

 

 

 

BBC link

 

All the news articles were complaining about how businesses were paying way more than domestic customers, now their rates are being fixed considerably lower than domestic. Doesn't seem overly fair.

[AlistairB1983]

All the news articles were complaining about how businesses were paying way more than domestic customers, now their rates are being fixed considerably lower than domestic. Doesn't seem overly fair.

Depends on your definition of 'fair' I guess.

[mavhc]

Looks like it's the same price as people are paying today, wholesale price of electricity is 20-30p/kwh this month so far, up from 4-10p the first half of 2021.

 

Why do you think businesses will get it cheaper?

[mikeprice]

Seems like we need something - whether or not this is the right thing is a matter of opinion - probably

 

What I am looking for is the long/medium term plan to build in more self generation so we can use far more UK generated power

 

I presume it will come - I just hope it is not based on fracking - or if it needs to be then this is only a short term fix with a clear path to greener methods

 

 

We shall see

[msi_school]

Domestic fuel production is not a good solution because the producers who will probably be multi national corps will want to sell the fuel at the international price.

[steveg]

Looks like it's the same price as people are paying today, wholesale price of electricity is 20-30p/kwh this month so far, up from 4-10p the first half of 2021.

 

Why do you think businesses will get it cheaper?

 

Assumed the prices that have just quoted for business that are fixed for the next 6 months are what they will be paying? Domestic rate with the new cap from October will be around 35p per unit for electricity, vs the 21p a unit they have just announced for business? Unless I've worked something out wrong somewhere!

[mavhc]

21p is the wholesale rate, not what they're buying it at, aiui

[steveg]

21p is the wholesale rate, not what they're buying it at, aiui

 

Makes you wonder how much is put on top by the energy companies in the middle then? They don't do much other than billing do they?

[elsiegee40]

Makes you wonder how much is put on top by the energy companies in the middle then? They don't do much other than billing do they?

 

They also have to pay for the use, repair and updating of the infrastructure that supplies the gas/electricity to the premises.

[pooley]

Well British Gas still expect me to pay £4k a year. I'm buying more jumpers for the family!!

[LeMarchand]

They also have to pay for the use, repair and updating of the infrastructure that supplies the gas/electricity to the premises.

 

Well, they're supposed to do all that.

[Andrew_C]

They also have to pay for the use, repair and updating of the infrastructure that supplies the gas/electricity to the premises.

 

You missed bumper payouts to shareholders, and enormous bonuses for CEO etc.

[steveg]

They also have to pay for the use, repair and updating of the infrastructure that supplies the gas/electricity to the premises.

 

Isn't this what the standing charge is supposed to cover? Then the unit rate just covers electricity used?

 

Def seems like there are too many different people involved in the process!

[Theblacksheep]

Makes you wonder how much is put on top by the energy companies in the middle then? They don't do much other than billing do they?

 

They have to buy at wholesale from suppliers in advance and sell on demand. If this was easy, energy companies wouldn't be going bust or state prop-up like Bulb. It's why a lot of the big boys keep prices high, they wont put themselves at risk.

 

Typically the domestic energy supplier makes about 2%.

 

Octopus are so far ahead of the game they can make efficiency savings with their software and customer usage knowledge, they can offer things like 7.5p night rates, 15p SEG tariffs and wiping the standing tariff for customers that are struggling.

[mavhc]

Energy suppliers are limited in the profit they can make to 1.9%

 

https://www.ofgem.gov.uk/publications/ofgem-confirms-changes-price-cap-methodology-and-frequency-ahead-new-rate-be-announced-later-month#:~:text=The%20price%20cap%2C%20as%20set,%25%2C%20protecting%20millions%20of%20households.

 

Of course that's pointless when they can lose >1.9% and then go bankrupt, and then we all pay extra.

 

You may be thinking of Energy Distributors or Energy Generators

[elsiegee40]

Isn't this what the standing charge is supposed to cover? Then the unit rate just covers electricity used?

 

Def seems like there are too many different people involved in the process!

 

The way it used to be back in the olden days when we had the CEGB, British Gas and local electricity and gas boards:

 

The CEGB generated the electricity, British Gas sourced the gas and both maintained national infrastructure. The local boards maintained the local supply infrastructure.

 

Consumers and businesses bought their gas/electricity from the local boards with the standing charge covering the cost of local supply infrastructure and board running costs.

 

 

How it works now:

 

Multiple generators of electricity and suppliers of gas. National Infrastructure for both maintained by National Grid. Local infrastructure by multiple companies (UK Power Networks, Northern Powergrid, Western Power, etc)

 

You buy your energy from a company that has had to interact with and pay the generator/gas supplier, with extra for both national and local infrastructure costs on top. Your energy company’s own internal costs are covered by the standing charge. Whether the charges for infrastructure are included in the unit cost or the standing charge is a grey area… probably a bit of both.

Edited September 22, 2022 by elsiegee40

[mavhc]

Plus as you're not actually paying wholesale rates they need to cover the periods where power is very expensive. While most power is bought in advance they still nee to balance it on the day by buying or selling at the daily/half hourly rates.

 

Wholesale is about 16p overnight and 28p in peak.

TNUoS costs are 4-9p, that's for 1600-1900 times

Balancing costs about 1p

Distribution costs 5-16p peak, ~0 over night

Capacity Market: 1600-1900 in winter, 5-10p

Renewable: 2.6p

Feed in Tariff: <1p

Contract for difference: currently -0.8p

 

So night time: 20p, daytime: 32p, 1600-1900: 50-60p

 

Meanwhile in Standing Charges:

"From April this year, the first of many decisions came into effect – moving distribution network residual charges to a fixed cost (which is added to standing charges). In simple terms, this means where previously a portion of the network costs (the costs for using and maintenance of the network infrastructure) were included in your unit rates, Ofgem has decided this should move to a fixed charge and collected via increased standing charges."

[mikeprice]

I have a Santander 123 account

 

it costs me a few pounds a month to keep it going but it gives cashback on direct debits to certain types of company

In my case this easily pays for the monthly fee

 

They have just increased the cashback for energy company payments from 2% to 4%

 

every little helps!

[6Foot2]

...I presume it will come - I just hope it is not based on fracking...

 

Link:

[Matt Cartoons Picture Tweet]

 

[elsiegee40]

Tested my microwave and ovens this morning.

 

The microwave uses 2W when not in use.

 

My ovens use 5W between the two when not in use.

[jmak]

Tested my microwave and ovens this morning.

 

The microwave uses 2W when not in use.

 

My ovens use 5W between the two when not in use.

So around £20/year

[Ditto]

Tested my microwave and ovens this morning.

 

The microwave uses 2W when not in use.

 

My ovens use 5W between the two when not in use.

What technique did you use to measure?