MSE News: British Gas warns of energy price rises

Former_MSE_Helen

This is the discussion thread for the following MSE News Story:

"Households face the prospect of more price hikes after British Gas owner Centrica warned costs continue to mount ..."

Read the full story:
British Gas warns of energy price rises

Butterfly_Brain

Why haven't they increased storage facilities whereby they could buy the gas when it is cheap so that they can offset big rises?........Oh I know it would eat into their profits :mad:.
That's it! I am buying a wood burning stove with back boiler and they can shove their gas where the sun doesn't shine.

Pincher

Butterfly_Brain wrote: »

Why haven't they increased storage facilities whereby they could buy the gas when it is cheap so that they can offset big rises?........Oh I know it would eat into their profits :mad:.
That's it! I am buying a wood burning stove with back boiler and they can shove their gas where the sun doesn't shine.

It costs money to hold inventory.

You could have bought petrol 5 years ago, at £1 a litre.
Assuming you have a shed big enough, and the legal issue aside, there's no rent on storage. You need about £5,000 in spare cash.

Who is going to put up the cash to stock up your storage facility?

This is aside from the planning permission, local protests, security costs (terrorism) and of course, building cost.

Amiethest

Not again. I've just about had enough.

Premier_2

Whatever happend to the previous story that gas prices in Europe are linked to oil prices?

molerat

Premier wrote: »

Whatever happend to the previous story that gas prices in Europe are linked to oil prices?

Only works when oil prices are rising Cynical, Moi ?

C_Mababejive

Butterfly_Brain wrote: »

Why haven't they increased storage facilities whereby they could buy the gas when it is cheap so that they can offset big rises?........Oh I know it would eat into their profits :mad:.
That's it! I am buying a wood burning stove with back boiler and they can shove their gas where the sun doesn't shine.

But why would they do that and how could they do it? Broadly speaking, Centrica just trades gas like any other companies. It doesnt own the transmission/distribution and storage networks.

Those are owned by other companies and centrica just pays for the use of that infrastructure.

Storage facilities have been cut cut and cut again because they are simply a cost and not a benefit and there is no money to be made in storing gas so no one want to do it.

The model used now is to tightly estimate gas useage on a day by day basis,stuff enough in the system,use it..then move on to the next day. Shortages and excesses are traded in and out usually to other EU countries.

Wasnt it better nationalised eh..?

tinkle

Butterfly_Brain wrote: »

Why haven't they increased storage facilities whereby they could buy the gas when it is cheap so that they can offset big rises?........Oh I know it would eat into their profits :mad:.
That's it! I am buying a wood burning stove with back boiler and they can shove their gas where the sun doesn't shine.

How much do you expect it would cost to increase their storage facilities? I imagine millions - which would need to be paid for somehow....catch 22

Terrylw1

C_Mababejive wrote: »

Wasnt it better nationalised eh..?

But would that reduce the wholesale cost? No.
Would it make the companies more efficient? Not necessarily. Councils are big money wasters and dont forget the bloke carrying the post on civil servant pay would be on a ridiculous level of pay compared to the private sector.

If the problem is truly greed, there is a regulator and what would they do to prevent public sector costs rising?

Don't forget a nationalised service doesn't answer to the customer and you get nowhere with complaints and you can't vote with your feet, only every 4 years to new government who will make promises and not deliver them.

The public sector is notorious for money wasting so its not a matter of going back to the good old days. Costs are costs, they've gone up and keep going.

What we need is someone to regulate the process of buying and selling. We also need someone to set efficiency targets to stop the companies venting millions of pounds in waste...like the American & Japanese production companies have over the last 30 years!

Antispam

Costs I expect years ago many towns/cities has huge storage facilities going back we used coal gas I think many councils at the time owned the companies going back further. They sold these storage facilities off and the area used for developments like housing well they did in my town


As for stove, they are also expensive rarely heat the entire home and also logs/coal has also risen as many have jumped the bandwagon hoping they can save money and save the planet

Its nice to tell BG and the likes to shove it but reality is its a bitter sweet revenge

Butterfly_Brain wrote: »

Why haven't they increased storage facilities whereby they could buy the gas when it is cheap so that they can offset big rises?........Oh I know it would eat into their profits :mad:.
That's it! I am buying a wood burning stove with back boiler and they can shove their gas where the sun doesn't shine.

C_Mababejive

As an insider, i can honestly say that the industry that i know, is running at as close to peak efficiency as possible. Manning levels have been cut,cut and cut again. Performance and efficiency is everything and employees are pushed hard. Many are on agency contracts to be hired and fired at will and little prospect of permanent contracts. People work overtime for nothing. People struggle to be able to book holidays etc etc so the view of Energy companies being big fat cats with a huge saucer of cream is very much media hype. True one might point to huge profits but these are linked to equally huge turnovers and these are mega industries with large long term debt.