Green, ethical, energy issues in the news

michaels

QrizB said:

Various people (not many in this thread, admittedly) have a bit of a downer on solar PV and heatpumps (etc) because the payback period is so long.

Here's the cheapest of two current fixed tariffs from BG Evolve. If these tariffs are the future (and not just BG trying to dissuade switchers and/or make a fast buck) then maybe the economics will change.

It is not the absolute level that matters but the ratio of gas to electric prices vs the efficiencies of the two fuel sources (cop vs boiler efficiency).  I guess this ratio is about 3.5 on that tariff so depending on usage pattern and heat pump efficiency it is  close to break even on fuel costs.

However at those prices long term I think we will all be in the poor house....

michaels

Not really for this thread but what happens if gas prices have fallen by next spring, sure the cap will rise by miles but every supplier will be able to offer much cheaper fixes based on the lower prices so the suppliers will not be able to recoup the losses over this winter except a little from those who can't be bothered to switch to save 500pa which is hopefully very few.

shinytop

michaels said:

QrizB said:

Various people (not many in this thread, admittedly) have a bit of a downer on solar PV and heatpumps (etc) because the payback period is so long.

Here's the cheapest of two current fixed tariffs from BG Evolve. If these tariffs are the future (and not just BG trying to dissuade switchers and/or make a fast buck) then maybe the economics will change.

It is not the absolute level that matters but the ratio of gas to electric prices vs the efficiencies of the two fuel sources (cop vs boiler efficiency).  I guess this ratio is about 3.5 on that tariff so depending on usage pattern and heat pump efficiency it is  close to break even on fuel costs.

However at those prices long term I think we will all be in the poor house....

If you add in the (in)efficiency of gas CH then it starts to look comparable.  Of course, you need to find the extra money to buy the ASHP, etc. but still.

What these price rises will do is focus minds on using less energy.  ASHP users have always had it drummed into them to insulate, stop draughts, turn the thermostat down, wear jumpers, etc.  Now everyone else will be doing it too, which isn't a bad thing.  

michaels

shinytop said:

michaels said:

QrizB said:

Various people (not many in this thread, admittedly) have a bit of a downer on solar PV and heatpumps (etc) because the payback period is so long.

Here's the cheapest of two current fixed tariffs from BG Evolve. If these tariffs are the future (and not just BG trying to dissuade switchers and/or make a fast buck) then maybe the economics will change.

It is not the absolute level that matters but the ratio of gas to electric prices vs the efficiencies of the two fuel sources (cop vs boiler efficiency).  I guess this ratio is about 3.5 on that tariff so depending on usage pattern and heat pump efficiency it is  close to break even on fuel costs.

However at those prices long term I think we will all be in the poor house....

If you add in the (in)efficiency of gas CH then it starts to look comparable.  Of course, you need to find the extra money to buy the ASHP, etc. but still.

What these price rises will do is focus minds on using less energy.  ASHP users have always had it drummed into them to insulate, stop draughts, turn the thermostat down, wear jumpers, etc.  Now everyone else will be doing it too, which isn't a bad thing.  

I would have thought at these prices for electricity we could simply massively overbuild wind and PV as the generation cost per unit (under 5p per kwh?) is so much lower.  Of course that might also help the price differential per kwh come down even more further improving the economics of the heat pump

Martyn1981

The recent gas/leccy prices, and these discussions, have reminded me about the NAO wholesale price predictions, which they used in their HPC reports to explain why the subsidy had increased so much (whilst the strike price is fixed (plus inf)).

There's probably a better source for these estimates, so this isn't about nuclear, just that the reports give 3 estimates of wholesale prices over time, making for a rapid reduction in estimated costs. The falls in wholesale prices are based on the faster falling costs of RE than expected, and also the falling cost of nat-gas ...... which ain't looking so good at the moment!

What is fun to see, is how the predictions expected costs to start rising now, after a dip, which seems pretty accurate, but then prices will peak and fall around 2028.

I'm not suggesting these results will be spot on, and the current rising prices are probably more of a co-incidence, but worth remembering that the falling costs of RE, are expected to stabilise and then reduce leccy prices in the longer term.


The  3 predictions basically state:

1. 2012 prediction - 2021 prices ~£70/MWh, peaking at £85/MWh in 2029. [Peak drops to about £83 in the subsequent report as prices amended to 2016 baseline.]

2. 2015 prediction - 2021 prices ~£50/MWh, peaking at £70/MWh in 2028, falling towards £60/MWh in 2035.

3. 2016 prediction - 2021 prices ~£40/MWh, peaking at £55/MWh in 2027, falling towards £45/MWh in 2035.


1 and 2 can be found on page 40 of this report.

2 and 3 can be found on page 39 of this report.

QrizB

Martyn1981 said:

The  3 predictions basically state:

1. 2012 prediction - 2021 prices ~£70/MWh, peaking at £85/MWh in 2029. [Peak drops to about £83 in the subsequent report as prices amended to 2016 baseline.]
2. 2015 prediction - 2021 prices ~£50/MWh, peaking at £70/MWh in 2028, falling towards £60/MWh in 2035.
3. 2016 prediction - 2021 prices ~£40/MWh, peaking at £55/MWh in 2027, falling towards £45/MWh in 2035.

That's interesting, and shows how even professional forecasters can be caught out by events.

Here is the chart from the second report:

I observe in passing that it's October 2021 now, and (according to Electric Insights) the average price for the past 12 months has been £81.79/MWh ...

Martyn1981

Hi QrizB, thanks. It's pretty scary seeing the prices rocket up in line with gas prices, this older OFGEM graph shows the impact of Covid (demand), and rising gas prices earlier in the year:



I suspect we need a hell of a lot more RE, and then storage, or this is going to be our world going forward.

NigeWick

Martyn1981 said:

maybe the current gas crunch will finally get politicians to take RE more seriously, 

I suspect our politicians are still getting backhanders from the nuclear and fossil fuel "lobbies" so unlikely to do much towards increasing renewables and energy storage.

QrizB

There's a 2017 article here from the Institute of Civil Engineers looking at wholesale electricity prices from 2003-2016:

https://www.ice.org.uk/knowledge-and-resources/briefing-sheet/the-changing-price-of-wholesale-uk-electricity

I dimly remember electricity getting cheaper in the early 2010s; per the ICE, the average price in 2008 was over £70/MWh (equivalent to £95 now, per the BoE inflation calculator)!

NigeWick

QrizB said:

Various people (not many in this thread, admittedly) have a bit of a downer on solar PV and heatpumps (etc) because the payback period is so long.

Here's the cheapest of two current fixed tariffs from BG Evolve. If these tariffs are the future (and not just BG trying to dissuade switchers and/or make a fast buck) then maybe the economics will change.

I looked at heat pumps when needing a new boiler. £2,000ish for a gas boiler, £16,000ish for heat pump & new radiators. Unfortunately, no contest. OTOH, if I win big on the lottery...