Scottish Power announces huge price hikes

shortchanged_2

What effect is the announcement today from Scottish Power likely to have on the UK economy?

It is likely that the others big companies will announce similar price rises soon.

The figures announced by Scottish Power (10% for electricity and 19%:eek: for gas) are far bigger than most people anticipated. Is this going to mess up the inflation predictions for the BoE and continue to put pressure on growth for the UK economy?

Graham_Devon

It's gonna mess up my outgoings, thats for sure.

DervProf

Interest rates should be cut to -1.5%, to help hard working families.

Conrad

With 50/60 million new souls being added to planet Earth annualy, we all better realise prices will be on a logarithmic steep upwards trend hereon in. Nuclear decline in Germany, perhaps Japan will also lead to a surge in Gas prices. AID also ensures a higher and faster growing more urban population. Developing nations are sucking in commodities like you wouldn't believe.

Forget the past, high prices all the way folks. Before you call for higher wages, just keep in mind this will mean higher prices still and make it even harder for us to export.

I could be wrong but I have this feeling we have been living a fantasy........

shortchanged_2

Conrad wrote: »

With 50/60 million new souls being added to planet Earth annualy, we all better realise prices will be on a logarithmic steep upwards trend hereon in. Nuclear decline in Germany, perhaps Japan will also lead to a surge in Gas prices. AID also ensures a higher and faster growing more urban population. Developing nations are sucking in commodities like you wouldn't believe.

Forget the past, high prices all the way folks. Before you call for higher wages, just keep in mind this will mean higher prices still and make it even harder for us to export.

I could be wrong but I have this feeling we have been living a fantasy........

I fear you are probably right Conrad. Long term the future for energy prices doesn't look good. However their shorter term impact on inflation could be very bad for the UK's economy in it's current state.

markharding557

shortchanged wrote:

What effect is the announcement today from Scottish Power likely to have on the UK economy?

I expect these hikes will be a further dampener on growth as average joe has less money after paying bills than before:(

J_J_Carter

I expect lots of Scottish refugees to the warmth of the South Coast and Devon. Crivens!

DervProf

J_J_Carter wrote: »

I expect lots of Scottish refugees to the warmth of the South Coast and Devon. Crivens!

A certain Scottish refugee moving to Devon.

Interesting.

Graham_Devon

This will no doubt have an effect on inflation towards the end of the year. Especially considering this is just the first of the big 6 to publish price rises. No doubt some will raise prices more than this.

5% has already been factored in. Currently 4.5%. However, it's likely that will fall back slightly as we progress through the year.

The BOE factored in 5% on the assumption gas prices would rise 15% and electricity prices 10%. So straight away, they have underestimated gas prices by 25% and got electricity spot on....based solely on scottish power.

That suggests that their inflation predictions, for energy at least, are underestimated. (not having a go, difficult to predict anything!!)

They also predcited these rises in the last quarter of 2011 and first quarter of 2012. These rises hit sooner. So could see more rises than estimated within the period they have predicted.

The BOE did state that plausable alternative paths for energy prices could have a significant impact on inflation.

Not that anything will change. Will just mean it's even harder to budge on interest rates.

Kohoutek

This the government's answer to expensive energy prices: providing energy efficiency home improvements on credit.

http://www.ft.com/cms/s/0/74027306-8d3c-11e0-bf23-00144feab49a.html#axzz1OPDsL2Tu

Ministers have tried to address public lack of trust in energy companies by offering assurances about the “Green Deal” – a policy designed to improve the energy efficiency of homes.

Under this plan, any householder will be able to spend up to £10,000 making their home more energy efficient, funded by the savings from future gas and electricity bills.

The goal is to renovate the entire housing stock, curbing demand for energy. The government hopes that 14m households will qualify for this overhaul over the next 10 years, with all 25m homes in the UK eventually being upgraded.

Graham_Devon

Any householder....households will qualify.

Doesn't make sense?