oil prices below $50 a barrel!! still no price cut!!

mech_2

PrinceGaz wrote: »

Uranium is easy to store, and whilst the price really rocketed last year, it has fallen considerably recently (like oil, gas and coal prices) such that the cost of it isn't really important. The raw uranium itself isn't the main cost to nuclear power generation, it is all the additional processing and safety procedures throughout its use that is the main cost factor.

The cost right now isn't the issue. Building a nuclear power station is a commitment for decades. If there's a likelihood of supply interruptions in the future, the price will go up until it is significant. That's how a supply/demand price curve works. The price would have to rise until it priced enough customers out of the marketplace.

We could easily stockpile many years of uranium reserves here in Britain if there were any reason to do so (provided it was kept in well secured storage areas), certainly far more than the amount of coal that would needed to be stockpiled in what would almost be a mountain outside a coal-fired plant.

It's difficult to stockpile in a constrained market. It's likely to push prices up. The UK does have some stuff stockpiled. Enough for 3 reactors for 60 years. Or to maintain current capacity for 16 years. I see a significant nuclear expansion in the UK as an expensive gamble rather than a magic bullet, that's all.

I know you say prices shouldn't go back up if oil-prices do, but I think for the average consumer it would be better if the energy companies pre-empted the price-cuts they might make later by making smaller ones now and delaying the rest of the saving until well into summer, so as to save those less well off who live on a fixed income week by week (and usually use pre-payment keys) from running out of money this winter and having to choose between heating and cooking.

I suspect it's a cash-flow problem. This is the time of year of peak turnover. The benefit to the customer would be small (delaying £20 to £30 of a bill?), but the utilities just might not be able to do it. We just don't know, so it's difficult to demand or insist that bills come down right now.

If people are that poor that they can't afford food, maybe the problem is that they are poor and not that their energy bill is too high? Or maybe we should demand food is cheaper? Personally, as someone who lives on very little myself, I'm not convinced people really have to choose between heating and eating. I spend far more on food than energy and I don't eat much. On the other hand there's the attitude that energy should be so cheap that we don't have to worry about how much we use. Well I can't agree with that.

The energy companies know that oil prices are unlikely to rise, so by holding energy-prices high, they are profiteering at a time when it will hit the elderly and other vulnerable groups the hardest.

Except we can't know whether they're making any profit at all this day, week or month. So how can we assume they're profiteering just because we don't like paying our bills?

That's why I'm saying a small reduction with immediate effect, based on the assumption reduced oil prices will last well into next year, and further reductions in 2009 based on the fact the energy companies were effectively borrowing from the future continued low oil price to subsidise the reductions over this (possibly much colder than any in recent years) winter.

Borrowing isn't very easy right now.

Cardew

PrinceGaz wrote: »

and this time you have disappointed me by leaving a hanging question without seemingly checking the answer yourself first, in case it would be in your favour to answer it.

= PrinzGaz
The fact that central Europe operates as one homogenous electric market and we are not part of it is wrong. The English Channel can easily have heavy cables laid across it, so we should be part of that market.

Have you done any further checking;)

Cardew

1carminestocky

What were the 'typical' retail prices in Jan 2007?

Cardew

An Interesting website is below:

http://sshassociates.co.uk/DomesticGasPrices.aspx

not sure what "a year's gas" means in this statement!

note that the wholesale cost of a year's gas has dropped recently to about 1.9 p/kWh, and the cost of transportation is 0.64 p/kWh making a total 2.54 p/kWh.

Table last modified on 29 Nov 2008

1carminestocky

Co-incidentally, 2.54p/kwh is exactly the Tier 2 price charged on BGs Click 5 before the (huge) increase...

mech_2

Cardew wrote: »

An Interesting website is below:

http://sshassociates.co.uk/DomesticGasPrices.aspx

not sure what "a year's gas" means in this statement!

They mean it's the average price for a unit if you bought a full year of futures (ie one of each of the next 12 months in one go). Not really useful for gauging the cost of supply as it isn't seasonally weighted and we don't have the next 12 months of retail prices to compare it to anyway.

The Inenco graph looks as though it's showing the same thing.

PrinceGaz

mech wrote: »

It's difficult to stockpile in a constrained market. It's likely to push prices up. The UK does have some stuff stockpiled. Enough for 3 reactors for 60 years. Or to maintain current capacity for 16 years. I see a significant nuclear expansion in the UK as an expensive gamble rather than a magic bullet, that's all.

Given that uranium is relatively cheap and we are likely to need more of it in future years/decades, and it is also relatively cheap to store because it is quite compact for the energy it can deliver, and the almost certain approval by the government for a major new build of nuclear power plants, why don't we stockpile more now? The raw uranium isn't going to run out of radioactivity anytime soon, so central planning of our future energy supplies would see us building up a significant stockpile so that future price increases in future decades don't affect us. I know the energy companies don't want to spend any money unless they can get an immediate return on it, but for long term stuff like a very expensive new generation of power plants, we should be stockpiling the fuel they'll need now whilst we know it is cheap compared with all the other costs involved.

AstarothCY

Sorry about this but I don't really have the time or patience to read through 8 pages of people arguing about energy.

Could somebody please succintly and honestly answer the following question:
Oil is now at below $40/barrel. Why have there been no electricity price reductions (official reasons)? Also, why is gas so expensive, and are gas prices at all tied to oil prices?

vix2000

And why have the government not made them?