Energy news in general

stripling

Why am I not surprised.... 🤔

Energy network owners have made £3.9bn from higher bills, says report

michaels

stripling said:

Why am I not surprised.... 🤔

Energy network owners have made £3.9bn from higher bills, says report

Offgem claim it is a rounding error but I work it to be about £60 per household per year based on 3.9bn / 3 years / 20m households.

The_Green_Hornet

British Gas owner reports slump in annual profits to £2.3bn

The owner of British Gas has reported a slump in its annual profits after the supplier was ousted as Britain’s largest provider of gas and electricity for the first time last year.

The supplier’s parent company, Centrica, reported adjusted earnings of £2.3bn for last year, down by a third from 2023 when its profits reached £3.5bn after a £500m windfall from the energy regulator.

Ofgem allowed all suppliers to recover the unexpected costs of the energy crisis in the first half of 2023 by adjusting the energy price cap, which helped British Gas to a profit of £751m.

British Gas owner reports slump in annual profits to £2.3bn | Centrica | The Guardian

The_Green_Hornet

Backlash over energy standing charges shake-up

Charities and energy providers have criticised plans to change the way standing charges on bills are paid.

All households pay the fixed daily charges covering the costs of connecting to a gas and electricity supply.

Many billpayers consider them to be unfair as they have no control over how much is charged, prompting the review by the energy regulator Ofgem.

But the regulator's plans to offer a choice of tariffs that shift these fees elsewhere on people's bills have been described as complicated and misplaced.

Backlash over energy standing charges shake-up - BBC News

Scot_39

Which only lasted 6 months and so

"efforts to recoup costs supported British Gas profits only in the first half of the year, and the division took a £200m hit in the final six months of 2023."

So actually £969m in the first 6m.

Form the linked article on B Gas profits.

https://www.theguardian.com/business/2023/jul/27/british-gas-record-profit-price-cap-increase

And not the only ones

"The French state-owned EDF reported that its UK business made profits of almost €2.3bn (£2bn) for the first half of the year – including the earnings from its nuclear power plants – up from €860m in the same months last year. It said this was driven mainly by the price cap. Scottish Power, which is owned by Spain’s Iberdrola, reported a profit of £576m for the first half of the year, from a loss of £86m last year."


Of course you have to treat some articles in The Guardian with caution, when it comes to cherry picking which measure of profits etc.

But did a company like EDF making nearly £800m profit over same months for just 6m in 2022 - no doubt in part due to operation of our "highest bidder wins" style bid auction system when gas at its peak - really need more from us gifted to them by Ofgem as the regulator ? 

Scot_39

The_Green_Hornet said:

Backlash over energy standing charges shake-up

Charities and energy providers have criticised plans to change the way standing charges on bills are paid.

All households pay the fixed daily charges covering the costs of connecting to a gas and electricity supply.

Many billpayers consider them to be unfair as they have no control over how much is charged, prompting the review by the energy regulator Ofgem.

But the regulator's plans to offer a choice of tariffs that shift these fees elsewhere on people's bills have been described as complicated and misplaced.

Backlash over energy standing charges shake-up - BBC News

Exactly as I have said in the past - Ofgems proposals to simply rebalance bills - between rates and standing charges - is just like pedants arguing semantics.  It fails to help tge problem for our poorest - its the net total bill that is too high and not just the poorest are struggling with.

SC+ X UNITS AT Y  = 0 + X UNITS AT (Y + SC/X) = Same unaffordable Bill.

Will need to read the Ofgem update for info on detailed proposals based on the 3 lines in the BBC article -  updated today later 

https://www.ofgem.gov.uk/consultation/introducing-zero-standing-charge-energy-price-cap-variant

QrizB

Scot_39 said:

The_Green_Hornet said:

Backlash over energy standing charges shake-up

Charities and energy providers have criticised plans to change the way standing charges on bills are paid.

All households pay the fixed daily charges covering the costs of connecting to a gas and electricity supply.

Many billpayers consider them to be unfair as they have no control over how much is charged, prompting the review by the energy regulator Ofgem.

But the regulator's plans to offer a choice of tariffs that shift these fees elsewhere on people's bills have been described as complicated and misplaced.

Backlash over energy standing charges shake-up - BBC News

Exactly as I have said in the past - Ofgems proposals to simply rebalance bills - between rates and standing charges - is just like pedants arguing semantics.  It fails to help tge problem for our poorest - its the net total bill that is too high and not just the poorest are struggling with.

I would suggest that "helping the poorest" is the job of the Welfare State, not of the energy regulator.

If benefits are too low, increase them (and increase taxes to balance the books). DESNZ shouldn't be using Ofgem to redistribute wealth.

stripling

@QrizB

If benefits are too low, increase them (and increase taxes to balance the books). DESNZ shouldn't be using Ofgem to redistribute wealth.

I would suggest that "helping the poorest" is the job of the Welfare State, not of the energy regulator.

I wouldn't object to a tax rise but unfortunately that doesn't work - in the UK it would be opening the door to sanctions, cuts and thus no energy. A bit like US healthcare insurance being linked to your job - lose your job, lose your healthcare with horror stories of people being thrown out of hospital mid treatment etc. Look at all the wrongful benefit cuts cases that get turned over in court a year later. 

Many countries have variations on social tariffs or KWh rates banded by consumption with a base-line of basic use and also exclusions from the higher cost energy bands for the seriously disabled or sick. 

Energy poverty is a very real thing and it is fundamental that as our energy market is rapidly being reshaped and our patterns of consumption are being forced to change, we build an inclusive, decarbonised energy system. This is both for fairness and for want of a better way of putting it, to impede social discontent and possible negative political consequences in the future.

Editing to add this from the BBC article: 
"

• "A block system in which customers pay a lower unit rate until a certain amount of energy is used, and a higher price thereafter."

  This is similar to some other European countries and imo is the fairest. Although it really is time that Ofgem shifts some of the charges onto gas and removes a few altogether. 

stripling

@michaels
Offgem claim it is a rounding error but I work it to be about £60 per household per year based on 3.9bn / 3 years / 20m households.

Good grief, that's really naughty. Well done you for doing the sums.  

QrizB

stripling said:

I wouldn't object to a tax rise but unfortunately that doesn't work - in the UK it would be opening the door to sanctions, cuts and thus no energy.

But then you say:

stripling said:

Many countries have variations on social tariffs or KWh rates banded by consumption with a base-line of basic use and also exclusions from the higher cost energy bands for the seriously disabled or sick. 

Surely the checks you need to pass to qualify for a access to social tariffs or for exclusion from higher tariff bands are just as prone to error as the means testing of benefits? So still sanctions, cuts and no energy for the wrongly-deprived?

Or are you suggesting that energy companies are less error-prone than DWP are?