Energy news in general

MattMattMattUK

ariarnia said:

MattMattMattUK said:

They would be no longer getting a bung, but in reality it made no difference to higher earners and lower earners are getting the additional handouts over the next twelve months anyway so it makes little difference. 

you do no that most people arent 'high' or v. low earners? 

I do, but of 29 million households 8.9 million get the additional help in 23/24, so nearly a third. The increase for those above that might not be fun, I certainly do not want to spend more money on energy than I did historically, but the reality is that a nominal increase, but real world decrease in costs for one quarter is not going to make a fundamental difference to their spending habits.

ariarnia said:

lots of people just above the cut off or who arent on eligible benifits who havent been feeling great about the situation. 

I doubt anyone is "feeling great" about energy price rises unless they happen to have shares in or work for the global energy producers, but the change in price for Q2 this year, coinciding with a seasonal drop in energy usage is likely to lead to a real terms drop in their energy costs, even if there is an increase in the headline rate. Meanwhile it means less government borrowing and so less money for taxpayers to have to pay back and pay interest on in the long run. If there is headroom to borrow an additional £2.6 billion then it could be spent in far more beneficial ways than a slightly higher subsidy on energy prices for three months.

MattMattMattUK

Mstty said:

michaels said:

Does anyone know how much the govt is saving on the unhedged bulb bail out due to lower than anticipated gas prices over the last few months - probably another couple of billion saved?

LMGTFY if true of course

There is a slight confusion of the issues, The government had already spent £4.6 billion on the cost of subsidising Bulb whilst in Special Administration as of Q2 2022 and that was expected to rise to £6.5 billion by the time it was disposed of. Octopus has paid the government £1.2 billion for the corpse of Bulb so there is some that will be recouped via that and the predicted £1.9 billion additionally will not have been as bad as Bulb managed to buy energy cheaper than predicted. The actual cost will not be known until later this year when the legal issues are resolved and the National Audit Office can finalise the cost implications, but the real cost is likely to be somewhere between £2.2 and £4.8 billion. 

Mstty

MattMattMattUK said:

Mstty said:

michaels said:

Does anyone know how much the govt is saving on the unhedged bulb bail out due to lower than anticipated gas prices over the last few months - probably another couple of billion saved?

LMGTFY if true of course

There is a slight confusion of the issues, The government had already spent £4.6 billion on the cost of subsidising Bulb whilst in Special Administration as of Q2 2022 and that was expected to rise to £6.5 billion by the time it was disposed of. Octopus has paid the government £1.2 billion for the corpse of Bulb so there is some that will be recouped via that and the predicted £1.9 billion additionally will not have been as bad as Bulb managed to buy energy cheaper than predicted. The actual cost will not be known until later this year when the legal issues are resolved and the National Audit Office can finalise the cost implications, but the real cost is likely to be somewhere between £2.2 and £4.8 billion. 

Do you think that has been written off whatever it costs or will that be added the the standing charges to be recouped?

ariarnia

MattMattMattUK said:

ariarnia said:

MattMattMattUK said:

They would be no longer getting a bung, but in reality it made no difference to higher earners and lower earners are getting the additional handouts over the next twelve months anyway so it makes little difference. 

you do no that most people arent 'high' or v. low earners? 

I do, but of 29 million households 8.9 million get the additional help in 23/24, so nearly a third. The increase for those above that might not be fun, I certainly do not want to spend more money on energy than I did historically, but the reality is that a nominal increase, but real world decrease in costs for one quarter is not going to make a fundamental difference to their spending habits.

ariarnia said:

lots of people just above the cut off or who arent on eligible benifits who havent been feeling great about the situation. 

I doubt anyone is "feeling great" about energy price rises unless they happen to have shares in or work for the global energy producers, but the change in price for Q2 this year, coinciding with a seasonal drop in energy usage is likely to lead to a real terms drop in their energy costs, even if there is an increase in the headline rate. Meanwhile it means less government borrowing and so less money for taxpayers to have to pay back and pay interest on in the long run. If there is headroom to borrow an additional £2.6 billion then it could be spent in far more beneficial ways than a slightly higher subsidy on energy prices for three months.

can i have a link for that 8.9m number please? i've googled and cant find it. 

i dont no why people keep saying 'a seasonal drop'...? yes people might use less but unless they pay on receipt of a bill then most people pay by dd. which means what they pay each month will go up by at least 67 each month.

i dont no what you consider 'nominal' but thats at least a week of food shop for us.  we can afford it but theres a lot of people who cant just swallow another increase with the rise in costs of everything else. 

MattMattMattUK

Mstty said:

MattMattMattUK said:

Mstty said:

michaels said:

Does anyone know how much the govt is saving on the unhedged bulb bail out due to lower than anticipated gas prices over the last few months - probably another couple of billion saved?

LMGTFY if true of course

There is a slight confusion of the issues, The government had already spent £4.6 billion on the cost of subsidising Bulb whilst in Special Administration as of Q2 2022 and that was expected to rise to £6.5 billion by the time it was disposed of. Octopus has paid the government £1.2 billion for the corpse of Bulb so there is some that will be recouped via that and the predicted £1.9 billion additionally will not have been as bad as Bulb managed to buy energy cheaper than predicted. The actual cost will not be known until later this year when the legal issues are resolved and the National Audit Office can finalise the cost implications, but the real cost is likely to be somewhere between £2.2 and £4.8 billion. 

Do you think that has been written off whatever it costs or will that be added the the standing charges to be recouped?

The government's line was always that it would be recovered by SoLR once the final cost was known, but it is currently funded from general taxation and the final costs will not be known until the back end of this year. I suspect in the end it will be left in general taxation purely because otherwise it would add 43p per day over one year, 22p per day over two years or 14p per day over three years to the standing charge and I think that would go down like a lead balloon. 

MattMattMattUK

ariarnia said:

MattMattMattUK said:

ariarnia said:

MattMattMattUK said:

They would be no longer getting a bung, but in reality it made no difference to higher earners and lower earners are getting the additional handouts over the next twelve months anyway so it makes little difference. 

you do no that most people arent 'high' or v. low earners? 

I do, but of 29 million households 8.9 million get the additional help in 23/24, so nearly a third. The increase for those above that might not be fun, I certainly do not want to spend more money on energy than I did historically, but the reality is that a nominal increase, but real world decrease in costs for one quarter is not going to make a fundamental difference to their spending habits.

ariarnia said:

lots of people just above the cut off or who arent on eligible benifits who havent been feeling great about the situation. 

I doubt anyone is "feeling great" about energy price rises unless they happen to have shares in or work for the global energy producers, but the change in price for Q2 this year, coinciding with a seasonal drop in energy usage is likely to lead to a real terms drop in their energy costs, even if there is an increase in the headline rate. Meanwhile it means less government borrowing and so less money for taxpayers to have to pay back and pay interest on in the long run. If there is headroom to borrow an additional £2.6 billion then it could be spent in far more beneficial ways than a slightly higher subsidy on energy prices for three months.

can i have a link for that 8.9m number please? i've googled and cant find it. 

Below is a link to "more than 8 million", or the first part £301) of the additional payments, further down in that article it mentions 8.1 million, I think it was Graham Stuart (Energy minister) in an interview that said 8.9 although I cannot find a link on my phone at the moment.
https://www.gov.uk/government/news/over-8-million-families-in-the-uk-to-receive-new-cost-of-living-payment-this-spring

ariarnia said:

i dont no why people keep saying 'a seasonal drop'...? yes people might use less but unless they pay on receipt of a bill then most people pay by dd. 

It is a long way away from "most people pay by dd" and I am presuming that you mean fixed/budget DD as variable would follow seasonal usage as well. Anyone on pre-payment (7.8 million households) will experience a very closely tracked seasonal drop. Ofgem says that 56% of people pay by Direct Debit (so roughly 16.2 million households) but does not say the split between variable and fixed Direct Debit. That means roughly 5 million on pay on receipt of bill, either monthly or quarterly. On that basis we are already in the "more than half" of people will see a seasonal drop directly in what they pay, likely somewhere between 60-70%. Fixed/budget Direct Debits will likely not go up or down apart from adjustments based on usage.

ariarnia said:
which means what they pay each month will go up by at least 67 each month.

I agree that they will no longer get the handouts, that is the same for everyone, however the seasonal drop will cover some or even all of that for many.

ariarnia said:

i dont no what you consider 'nominal' but thats at least a week of food shop for us.  we can afford it but theres a lot of people who cant just swallow another increase with the rise in costs of everything else. 

The net change will not be £67 though, with season variations in usage it will for some be even less, eg. my December and January usage even with the £67 is higher than my (historical) April and May usage without £67 and that pattern likely holds true for most people, being that in winter one uses heating, that heating water up for showers etc. costs more due to lower input temperature and that heating is rarely if ever needed in April and May.

Mstty

MattMattMattUK said:

Mstty said:

MattMattMattUK said:

Mstty said:

michaels said:

Does anyone know how much the govt is saving on the unhedged bulb bail out due to lower than anticipated gas prices over the last few months - probably another couple of billion saved?

LMGTFY if true of course

There is a slight confusion of the issues, The government had already spent £4.6 billion on the cost of subsidising Bulb whilst in Special Administration as of Q2 2022 and that was expected to rise to £6.5 billion by the time it was disposed of. Octopus has paid the government £1.2 billion for the corpse of Bulb so there is some that will be recouped via that and the predicted £1.9 billion additionally will not have been as bad as Bulb managed to buy energy cheaper than predicted. The actual cost will not be known until later this year when the legal issues are resolved and the National Audit Office can finalise the cost implications, but the real cost is likely to be somewhere between £2.2 and £4.8 billion. 

Do you think that has been written off whatever it costs or will that be added the the standing charges to be recouped?

The government's line was always that it would be recovered by SoLR once the final cost was known, but it is currently funded from general taxation and the final costs will not be known until the back end of this year. I suspect in the end it will be left in general taxation purely because otherwise it would add 43p per day over one year, 22p per day over two years or 14p per day over three years to the standing charge and I think that would go down like a lead balloon. 

That was my understanding as well so good to have confirmation.

Like yourself I don't think they can it to the SC. Dual fuel is £300 a year from April which will no doubt become a hot topic when people realise.

peter3hg

MattMattMattUK said:

Mstty said:

michaels said:

Does anyone know how much the govt is saving on the unhedged bulb bail out due to lower than anticipated gas prices over the last few months - probably another couple of billion saved?

There is a slight confusion of the issues, The government had already spent £4.6 billion on the cost of subsidising Bulb whilst in Special Administration as of Q2 2022 and that was expected to rise to £6.5 billion by the time it was disposed of. Octopus has paid the government £1.2 billion for the corpse of Bulb so there is some that will be recouped via that and the predicted £1.9 billion additionally will not have been as bad as Bulb managed to buy energy cheaper than predicted. The actual cost will not be known until later this year when the legal issues are resolved and the National Audit Office can finalise the cost implications, but the real cost is likely to be somewhere between £2.2 and £4.8 billion. 

I don't think you are correct. The £4.5bn was an estimate of the upper limit of the cost, not actual costs. 

"In December, the Department for Business, Energy and Industrial Strategy (BEIS) said it had been advised by Bulb's special administrator to set an upper limit for the post-takeover funding facility of £4.5bn.

The £4.5bn figure represents an estimated upper limit of the support based on forecasted energy costs during the period until 31 March 2023, which reflects the current volatility in global energy prices, BEIS said at the time.

The extent of government support could be lower than £4.5bn, depending on energy prices this winter."

https://news.sky.com/story/taxpayers-bulb-bailout-cost-plunges-after-octopus-supply-deal-with-government-12812525

Everything I can find gives the revised forecast total cost to the government/taxpayer to be a couple of hundred million, not the figures you've suggested.

EssexHebridean

ariarnia said:

i dont have the details the chancellor has and agree its a complicated question but cant help but feel some of the comments made by some who support the increase are dismissive and patronising of those who are and have been struggling. 

i posted on the other thread that as the guarentee is expected to be a lot cheaper than budgeted for then i think it would remove a lot of anxiety from a lot of people who are concerend about energy prices AS PART OF the wider problems with the economy/inflation/cost of living and world afairs if they kept it where it was.

a lot of people have pointed out how close to the actual cap (and under the cap) the cost is supposed to be over the year so on the other side of that is how over the year it wont actually cost the goverment all that much while not adding yet another stick to already breaking (mental and metaphorical) backs.

yes we can spend that cash on other things and ive already said i dont have a problem with it if thats what they do but i think we shouldn't dismiss the people what choice is going to hurt by saying its as simple as 'eating cold food' when some of those people are struggling to eat reguarly at all without food bank help already. 

This is the thing - "people" are about more than just the hard facts. Sure, we can reassure on here as much as we like that in fact that oft-quoted £500 increase will actually for almost everyone be a far, far smaller amount, but that doesn't stop them worrying when they constantly see the other ide of the story presented in the mainstream media. We're all in our own bubble to an extent - for some of the regulars on these boards it might be a "bubble" where they're surrounded by folk with good knowledge on energy matters, or savings and investments matters - but that's not representative of the world at large. The flip side is that for someone in debt, all they see if the debt, that they can't make ends meet, and the appearance of there being no end in sight is what keeps them awake at night. On top of the cost of living crisis we are heading at a rapid rate towards a consumer debt crisis too - that is going to have massive implications for particularly middle earners I suspect in a few years time when deals end and the interest starts having an impact. I think the "bubble" thing is very much underlined by the suggestion that someone struggling to make ends meet because of a constant stream of price rises should just eat their food cold or cook it more efficiently - it's a massive simplification for a start because a lot of those people won't have any way of cooking more efficiently than they already are, and may already be eating cold food most of the time. There are only so many cuts you can make before you hit bone.  I'm incredibly fortunate to be able to afford my energy bills, AND to have a home that is relatively speaking easy to heat, albeit I've got to that position of fortune thanks to decent choices and hard work (had we still been clearing off a mortgage we might be in a rather less comfortable position - and had we not paid it off early by OP'ing we would indeed still have another 5 years to go) but I can absolutely see and understand why this current cost of living situation is causing huge amounts of stress and distress to so many people. And of course I've also had a degree of privilege to be able to have made those choices, too! The implied assumption that those who are struggling must be in some way profligate or wasteful and should simply be "doing things better" does feel really removed from reality, and I slightly question how by this stage anyone can still be so cushioned from the way others live that they can believe that's a realistic solution for the majority.

It is complicated - but I think Martin has put his case very well on this - when you're budgeting to spend X amount on something, and in fact the actual costs even if maintaining the current level of support will still come in way below that X figure, there is a very good case for viewing that as a "saving" in real terms. There is also of course the point that there may well be more savings to be made in terms of lower healthcare costs due to improved mental health thanks to the reassurance the perceived "extra help" provides. Sure, for middle and higher earners the EPG increase will probably be better further along the line as it will reduce their tax burden, I can see the thinking, but I'm not really sure I can agree with it. (Perhaps because I'm NOT a middle or high earner!) 

MattMattMattUK

Mstty said:

MattMattMattUK said:

Mstty said:

MattMattMattUK said:

Mstty said:

michaels said:

Does anyone know how much the govt is saving on the unhedged bulb bail out due to lower than anticipated gas prices over the last few months - probably another couple of billion saved?

LMGTFY if true of course

There is a slight confusion of the issues, The government had already spent £4.6 billion on the cost of subsidising Bulb whilst in Special Administration as of Q2 2022 and that was expected to rise to £6.5 billion by the time it was disposed of. Octopus has paid the government £1.2 billion for the corpse of Bulb so there is some that will be recouped via that and the predicted £1.9 billion additionally will not have been as bad as Bulb managed to buy energy cheaper than predicted. The actual cost will not be known until later this year when the legal issues are resolved and the National Audit Office can finalise the cost implications, but the real cost is likely to be somewhere between £2.2 and £4.8 billion. 

Do you think that has been written off whatever it costs or will that be added the the standing charges to be recouped?

The government's line was always that it would be recovered by SoLR once the final cost was known, but it is currently funded from general taxation and the final costs will not be known until the back end of this year. I suspect in the end it will be left in general taxation purely because otherwise it would add 43p per day over one year, 22p per day over two years or 14p per day over three years to the standing charge and I think that would go down like a lead balloon. 

That was my understanding as well so good to have confirmation.

Like yourself I don't think they can it to the SC. Dual fuel is £300 a year from April which will no doubt become a hot topic when people realise.

I would not want to bet on it either way, but I do think that it will be deemed unpalatable to put it on the SC, especially as it will hit in the run up to next year's general election. 

I think we will get another tranche of people having a tantrum about standing charges once people see the prices, with the same as previous that it is "the energy companies ripping people off" with them failing to understand that the energy providers do not get to keep the standing charge.