Energy news in general

[Deleted User]

DerwentMailman said:

Dolor said:

I would though be interested to hear the CEO Ofgem defend his decision to add future costs to the Cap to prevent future supplier failures at a time when energy prices are still ramping up. He clearly failed to get all his fellow Board members onside, and they all had access to all the facts.

I agree totally although we probably all agree that highlighted section from the CEO should be 'add possible future costs' 
 

Semantically, we are both wrong. What the Ofgem Decision actually states is this:

‘Backwardation costs are a result of the difference between the index used to set the cap level and the way suppliers are able to purchase energy for their cap customers. We seek to address these risks and enable suppliers to recover efficient costs. Not doing so increases the risk of supplier exits, of which the cost is ultimately bourn by customers in the near term and reduces the benefits of competition and innovation in the longer term.’

These additional costs, if there are any, will be recovered over a 6 month period. Ofgem’s defence of this change is that it has concluded that the cost of supplier failure could be much higher this coming Winter than the last. 

QrizB

I don't think this has been shared here yet? (Apologies if it has.)

https://www.cornwall-insight.com/press/investment-in-renewable-pushes-power-price-projections-down-but-they-remain-above-the-pre-2021-average-for-next-decade/

Cornwall Insight’s latest – GB Power Market Outlook to 2030 – has shown greater investment in renewables by nations across the continent, which has resulted in lower price projections in GB from 2024 up until 2030. This is compared with our first report, published three months ago. Renewable investment has increased largely as a response to the war in Ukraine. Despite the fall, predicted prices are still set to remain above the pre-2021 historic average.  

In the first GB Power Market Outlook of 2022, power prices were predicted to stay above £100/MWh annually, however the new report shows prices dipping below the previous forecast in 2024, and going below £100/MWh from 2026 onwards, with a low of below £80/MWh in Summer 2029.

Includes this chart of forecast wholesale electricity prices:

• £220/MWh in 2022 is about 36p/kWh retail. (We had 3 months ar 21p. 6 at 28p amd are about to have 3 at 55p - average 33p.)
• £180/MWh in 2023 is about 30p/kWh retail.
• £140/MWh in 2024 is about 25p/kWh retail.
• £110/MWh in 2025 is about 22p/kWh retail - and half current wholesale prices.
  

My assumption is that these prices are in current-day £, not adjusted for inflation.

I'll add the usual caveat that Cornwall Insight's forecasts haven't historically been great beyond the very short term, so don't go making any life plans based on this article.

GingerTim

It's a little sad that it's taken a war to prompt greater investment in renewables  - but the more the better.

MattMattMattUK

GingerTim said:

It's a little sad that it's taken a war to prompt greater investment in renewables  - but the more the better.

Most people only change when the alternatives to not changing become immediate and worse, governments are just the same. One only has to look at the way people eat, consume, run up debt, smoke, drink excessively, waste money, run up date, become obese etc. to see how most people can barely see beyond the short term, let alone truly understand the long term.

xeny

That's an interesting graph to look at in conjunction with 

https://twitter.com/JavierBlas/status/1557071760423432192

which is a graph of gas futures and in part shows how rapidly they can/are repricing even for as near as summer 2023.

[Deleted User]

Well we have had the suggestion of freezing the cap at the April levels.  Now we have the suggestion of nationalising the 'energy companies'

 https://www.bbc.co.uk/news/uk-scotland-scotland-politics-62623751

I assume she is talking about the suppliers and not the producers!

michaels

[Deleted User] said:

Well we have had the suggestion of freezing the cap at the April levels.  Now we have the suggestion of nationalising the 'energy companies'

 https://www.bbc.co.uk/news/uk-scotland-scotland-politics-62623751

I assume she is talking about the suppliers and not the producers!

This may happen if they go bankrupt through the level of bad debt likely to accrue over the winter.  Not sure what happens for companies that produce and supply (EDF, BG Centrica), can they put their loss making supply arms into bankruptcy whist hanging on to their (UK and International) generation assets?

pochase

Why should they not be able to, if it is a different company.

sully1311

BBC News: "Plans to cut energy bills if peak-time use avoided"

https://www.bbc.co.uk/news/business-62626908

QrizB

sully1311 said:

BBC News: "Plans to cut energy bills if peak-time use avoided"
https://www.bbc.co.uk/news/business-62626908

That will really annoy the smart meter haters ...

Plans to enable households to get discounts on electricity bills if they cut use at peak times are set to be announced in the next two weeks.

The scheme would allow people to save cash if they avoid high-power activities, such as cooking or using washing machines, when demand is high.

It is understood the service is likely to apply to homes which have smart meters installed.

There are hopes it can be put in place this winter, with energy bills rising.

"We are developing a new service that will be available for consumers to benefit from across this winter and will be announcing further information soon," a spokesman for National Grid ESO - which will run the scheme - said.

It is understood the company's proposals of how it will work, such as how money will be paid back to customers, are expected to be revealed in the next fortnight, with consultations taking place with energy providers and the UK's energy regulator Ofgem.

It has been reported that rebates for minimising the use of goods such as tumble dryers, dishwashers and games consoles during the peak hours of 17:00 and 20:00 could be as high as £6 per kWh saved.