Time to demand the scrapping of Ofgem

Graeme_r_2

We are paying through the nose for Gas and Electricity and BBC s' watchdog tried to contact that useless Quango Ofgem to find out why they weren't forcing Gas and Electricity Companies to reduce prices when Crude Oil fell.

I was appalled that Offgem refusd to be interviewd to account for their intransigence but even worse that they gave up their right to regulate prices some years ago on the basis that the market was working and they felt they no longer needed to have the right to exercise such powers. What are they there for now? What is the point of them?
Can we get Martin to participate in a national campaign to call for Ofgem to be scrapped and replaced with a new regulatory body with the Powers to regulate Gas and Electricity Prices. Oh and no existing Ofgem Senior Staff should allowed to serve on any such new body as they have demonsrated themselves to be a waste of space.
Public Opinion about MP's expenses has led to drastic change. The Public need to be made aware of how pointless Ofgem are- it could have a big impact that would benefit us all if we had a new regulatory body that er well REGULATED!!.
The Government have some explaining to do as well - why have they just sat back and allowed a bloated unfit for purpose Public money consuming Quango as in Ofgem to continue on regardless?

edgex

er, blah blah blah

you obviously have no idea about gas or electricity, or about how the markets work

robredz

They are too busy hoovering up their salaries to take any interest in the plight of anyone on a low income and in fuel poverty. They need culling and replacing PDQ

sandiep

The electricity and gas companies are paying for oil and gas and coal now at rates that were negotiated as far back as 5 years ago. They manage their costs by using forward contracts, and hedging. You honestly don't think that they buy at spot market rates? Remember that last year saw prices going up at phenominal rates, did you forsee the worldwide financial crisis and recession.

Question you need to ask is how/what do you think that the oil supply and price is going to be like in 5 years time? What's that, Dubai gone bust? How do you think the arabs are going to recover their money -oil price hike anyone???

robredz

sandiep wrote: »

The electricity and gas companies are paying for oil and gas and coal now at rates that were negotiated as far back as 5 years ago. They manage their costs by using forward contracts, and hedging. You honestly don't think that they buy at spot market rates? Remember that last year saw prices going up at phenominal rates, did you forsee the worldwide financial crisis and recession.

Question you need to ask is how/what do you think that the oil supply and price is going to be like in 5 years time? What's that, Dubai gone bust? How do you think the arabs are going to recover their money -oil price hike anyone???

The book is up and running and the odds are 6 to 4 on

The whole futures market is no better than betting on a horse.

Graeme_r_2

edgex wrote: »

er, blah blah blah

you obviously have no idea about gas or electricity, or about how the markets work

I have heard the Gas and Electricity companies interpretation about how the markets work. However, my point was, what is the point of having an Energy regulating company that doesn.t regulate assuming they know how the markets work?

Do you work for Ofgem or one of the Cartel of six by any chance?

Graeme_r_2

edgex wrote: »

er, blah blah blah

you obviously have no idea about gas or electricity, or about how the markets work

What is is that I don't know about Gas and Electricity by the way? I am a graduate Chemist with a Physics A Level too so I think I understand a bit about them probably as much as you if not more.

SwanJon

Graeme_r wrote: »

What is is that I don't know about Gas and Electricity by the way?

I think it was about the Gas and Electricity Markets (the GEM bit of OFGEM).
For example, parts of the Gas and electricity supply network are regional monopolies, like water in England & Wales. Ofgem are also responsible for this part of the market.
Do you suggest that we get rid of the only regulation on these monopolies?

Before you start bleating about disbanding something, do some research on the consequences.

dogshome

Whatever our personal view of the Tories selling off the family silver by privatising the utilities, it cannot be denied they made a reasonable fist of the legislation put in place to protect customers interests - Ofgem were empowered to directly control prices, whilst Energywatch were the central Agency for customer complaints and could quickly identify areas of abuse by individual companies or the industry
So why the blazes did New labour throw all this overboard in 2002, to replace it with price control by 'competition' and an Ofgem so weakened that when they asked the Utilities to show them the Forward Bought Contracts that were keeping prices high in a falling market, the Utilities were allowed to refuse on the grounds that this was 'Sensitive Commercial Information'
The answer has to be that the Utilities have a very well financed parliementry lobby - In the Telegraphs revelations on the scandal of MP's expenses, one MP declared an outside interest as a consultant to EDF worth £15,000 a year - In Utility finances £15,000 is pocket money, so one wonders just how many other MP's are in reciept of this bounty.
When for 18 months Ofgem were regularly issueing press releases telling us that Competition was working, whilst Energywatch was telling us the opposite, what was Whitehalls solution to this embarressment? - Shut down Energywatch of course.
For me, the entire realtionship between the Utility Industries and Govt has the smell of fish that is way beyond itls sell-by date.

mech_2

sandiep wrote: »

The electricity and gas companies are paying for oil and gas and coal now at rates that were negotiated as far back as 5 years ago.

It's funny how this figure constantly goes up and up the further we get from the peak in prices. At one point they were saying 6-9 months. Then it became a year. Then 18 months. Ofgem use 18 months and I see no reason to assume it's more than that to any statistically significant level. An 18 month hedging model does fit the average retail prices reasonably well... up until this year where commodity costs have crashed and retail prices have hardly budged.

kippen_noedel

Having actually worked for a gas wholesaler in Holland for 3years, I have to laugh at people who think the retailers of energy (domestic suppliers) are the ones that make any of the real money out of this market.

The government gets the biggest share, start with the "discovery tax", starts at 50% rising to 75%, thats before the gas gets to your supplier.

Then once your supplier bills you there is a further average 26% in taxes bolted on.

Wholesalers take the next biggest slice leaving energy companies to run their businesses on average less than 4% before tax. so for every £1000pa you spend on gas your supplier is making £40pa.

If people really want lower bills, then petition the government to reduce the taxes. Of course that just means your taxes will rise somewhere else.