Is this a national fraud by the gas industry?

Conrad123

Gas suppliers quote 'fixed prices'.

This is not strictly true. They may charge a fixed price per unit but the amount you pay for your gas is variable.

The gas you use is measured by your meter by volume (usually cubic metres these days). This, for some reason, is converted to Kilowatt Hours (kWh) and you are then charged per kWh.

This conversion is done using a formula that includes the Calorific Value (CV) of the gas which is a variable amount.

(The Calorific Value is the heating effect of the gas, i.e. the amount of heat produced when a fixed volume of gas is burned. Some gas comes out of the manufacturing process 'richer' than others).

So, if the Calorific Value used in the conversion is variable, then the number of kWhs that you are charged for for each cubic metre of gas is variable.

Hence your gas bills are variable and not fixed, even if the unit price is fixed.

Numerous gas processing plants supply gas to a national gas pipeline grid network. Some of this gas also comes from abroad by, for instance, our grid being connected to the French grid.

Each supplier supplies different Calorific Value to the grid.

How on earth is it possible to calculate the Calorific Value of the gas coming into your home at any point in time.

Indeed, the Calorific Value of the gas in the pipes is constantly changing. It doesn't switch suddenly from one value to another It is constantly changing.

Even with monthly meter readings there is a huge opportunity for mis-charging consumers for the gas they use.

When I buy coal I pay for it by the ton - not by the kWh.

When I buy petrol I pay for it by the litre - not by the kWh.

Why don't I pay for my gas by cubic metres - which, after all, is what I use?

It must be inequitable to charge for gas by its 'heating effect' rather than its volume. The 'heating effect' of the gas you are using can never be accurately determined and must be worked out by some averaging process.

This leads to the opportunity for the gas industry to adjust its income without changing the prices it charges.

Gas should be charged per cubic metre.

penrhyn

Pedants corner: Its metre, not meter.

insanegloss

Wrong on every level I'm afraid. Put simply, the flaw in the argument is that your paying for energy, and that it's how it's charged in kWh (1 kWh =3.6 megajoules of energy) not volume. If it was on volume, what's to say they pump less natural gas and more air? You'll get less energy to heat with.

I suggest you research this before jumping to wild conclusions. The national grid have a page about it somewhere.

dm20

If we didn't use a calorific value, say, your m3 of gas could have less energy in in than my m3 of gas. If we both paid for the same volume of gas, but yours had less energy in it so made your house less warm, wouldn't you feel hard done by?

The determination of the CV of gas is carried out in accordance with international standards and the Gas (Calculation of Thermal Energy) Regulations, as amended in 1997. These regulations stipulate when and where the CV of gas is measured and the type of instrument to be used. The regulations are enforced by Ofgem, who also perform audit checks on the primary data.

http://www2.nationalgrid.com/UK/Industry-information/Gas-transmission-operational-data/calorific-value-description/

Cardew

Conrad123 wrote: »

Why don't I pay for my gas by cubic meters - which, after all, is what I use?

Welcome to the forum.


You have answered your own question. It is because the energy value of a cubic metre can vary.


Also many people have a meter that measures in cubic feet, and that gas supply is also converted to kWh.


To take your analogy about coal, for certain types you pay more because the calorific value is higher.


Read this:


http://www2.nationalgrid.com/UK/Industry-information/Gas-transmission-operational-data/calorific-value-description/

Conrad123

insanegloss wrote: »

Wrong on every level I'm afraid. Put simply, the flaw in the argument is that your paying for energy, and that it's how it's charged in kWh (1 kWh =3.6 megajoules of energy) not volume. If it was on volume, what's to say they pump less natural gas and more air? You'll get less energy to heat with.

I suggest you research this before jumping to wild conclusions. The national grid have a page about it somewhere.

So explain to me how that is different to buying petrol? I am 'paying for energy' there but paying for it by the litre.

I think there would be serious safety issues if they added unnecessary air to the gas grid making it highly explosive. They just couldn't do that legally.

I suggest you research safety aspects of flammable gasses before......

Bluebirdman_of_Alcathays

Conrad123 wrote: »

So explain to me how that is different to buying petrol? I am 'paying for energy' there but paying for it by the litre.

I think there would be serious safety issues if they added unnecessary air to the gas grid making it highly explosive. They just couldn't do that legally.

I suggest you research safety aspects of flammable gasses before......

No, you are not paying for energy when you buy petrol, you're paying for a volume of liquid. If it's watered down, you pay the same despite getting less energy.

Nobody suggested they add air unnecessarily.

Conrad123

CARDEW

With respect I think you have missed the point.

The point is that it is an unfair way to charge.

Your 'coal' argument is a good example of what I mean. You buy a ton of coal for a certain price and you know exactly what calorific value you have bought. As you say you would pay more for higher CV coal.

You buy a m3 of gas and you are charged a notional CV which could bear no relationship to the CV of the gas coming into your home at the time you used it.

This is particularly so for companies like Daligas who charge annually for your usage and somehow use an 'annual' CV rate, which at best can only be a crude average and very loosely related to the CV of the gas you used throughout the year.

Conrad123

Bluebirdman_of_Alcathays wrote: »

No, you are not paying for energy when you buy petrol, you're paying for a volume of liquid. If it's watered down, you pay the same despite getting less energy.

Nobody suggested they add air unnecessarily.

Yes I am paying for energy when I buy petrol - energy to make my car move. It's not just a liquid - it is a very particular liquid with latent energy stored within it. It is no good to me if it doesn't have any latent energy.

I am buying it to burn in order to release that energy.

I am sure that different petrols and different batches have varying amounts of energy stored in each litre. In effect, varying calorific values.

Paraffin is cheaper than petrol because it doen't make my car go so well.

So would you argue that we should pay for petrol 'per equivalent kWh'?

INSANEGLOSS was indeed sugesting that air would be added unnecessarily - he said "what's to say they pump less natural gas and more air?".

Mulder00

Afaik, the calorific value is determined based on the supply in the area, not the energy company you are with. Paying for the energy produced rather than the actual volume is a much more efficient way of measuring it (I see it as paying only for weight of the meat, not the bone). Someone in an area with a lower CV will use more gas to produce the same amount of heat in another area, but they will pay the same.

The flaw in your argument about petrol is that you actually do pay different prices based on the energy output (so it's closer to the way we pay for gas, than paying a fixed price regardless of energy output) - think about super vs normal unleaded petrol - you pay a different price.

Bluebirdman_of_Alcathays

Conrad123 wrote: »

Yes I am paying for energy when I buy petrol - energy to make my car move. It's not just a liquid - it is a very particular liquid with latent energy stored within it. It is no good to me if it doesn't have any latent energy.

I am buying it to burn in order to release that energy.

I am sure that different petrols and different batches have varying amounts of energy stored in each litre. In effect, varying calorific values.

Paraffin is cheaper than petrol because it doen't make my car go so well.

So would you argue that we should pay for petrol 'per equivalent kWh'?

INSANEGLOSS was indeed sugesting that air would be added unnecessarily - he said "what's to say they pump less natural gas and more air?".

No, with petrol you are paying for the volume. That is what your money gets you. The amount of energy it contains is irrelevant. What you do with it is up to you.

Paraffin is not cheaper because of what you can do with it in your car. The demand and supply market for fuels does not depend on how you fuel your automobile.

Now, of course different petrols have varying thermal conductivity. Should we pay for petrol on a per KWh basis? Why not! There are plenty of people out there that believe supermarket petrol isn't as efficient as other petrol, so it's not a radical concept.

What I don't understand is how any of this makes the way we pay for gas unfair - surely by linking what you pay to what you can do with the energy it's an extra layer of protection for the consumer.