And now the forecasters are saying the price cap could hit £6000

Ultrasonic

tghe-retford said:

Problem is, that is exactly what happened with the mobile phone network market in the early to mid 2010s. They priced out people and increased prices for people who could still afford their product. It worked and many networks followed that practice. Now the energy generation companies and the wholesale price will follow. And they have an green strategy which requires reductions in energy usage to lower CO2 to consider now too.

The days of reduced demand will lead to reduced prices have come to an end. It no longer applies. And even if there was an excess of supply somehow, they can just do an OPEC on energy to keep prices high.

That's a view, but not one I share. I'd argue the huge price volatility over the last 9 months is evidence in itself that nobody is somehow 'in control' of pricing in the way you're suggesting. 

ProDave

wittynamegoeshere said:

There are some pretty cold statements made on here, by presumably fairly wealthy people who appear to have zero empathy for those that simply can not afford the basic costs of living.

I get the impression that a significant number of vociferous posters on this forum could have a substantial financial or career interest within the industry and seem very keen to sometimes pretty insultingly put down those who question the status quo.  I don't know what the motive is, but the end result is often unpleasant to read.

The glaring elephant in the room is that SOME of our energy comes from imported energy sources so is subject to world events.  The issue is that we are selling our own home-grown energy to ourselves for pretty much the same price as it would cost to import, and this is often passed off as being due to the holy rules of market forces.  This means that the overall energy mix is costing the suppliers the same amount as entirely imported energy would cost, and those who happen to run the energy resources are making a massive windfall profit, at the expense of the entire population of the country.

I now await the usual insulting jokes about communism etc etc.

Top post.  the big issue is why does the market allow the highest cost source to dictate the cost for ALL of a particular fuel?

Address that, so that only say the imported gas costs us more and domestic produced gas costs the same as before etc and you have cracked the problem and the rise due to imported scare fuel adds much less to our bills.

The situation we are in, the market is broken and disfunctional, but I have not heard a single politician discuss how we can correct the way the UK energy market works.

If electricity gets to £1 per kWh the surely a slightly modified "diesel" generator running from Kerosene would actually be cheaper to power our homes?

savers_united

I don't think it works like that, global pricing is exactly that. If we buy on the international market then we pay that price regardless of where it is generated. If generation here can be sold at those global prices then those who extract the stuff who are private companies and have heavily invested in their operations are going to want to sell their Gas at those global prices. Let's assume in a few years there is a slump in gas prices, do we still support the North Sea and pay above the global price. We have for decades now had access to very cheap gas on the global market, now people want to move away from that model, I did not hear the same calls during the pandemic and for us to support North Sea exploration when gas prices fell through the floor. 

littleteapot

Yep standard human mentally. Want to have a cake, eat all of it, and still have a whole cake for tomorrow. 

One of the biggest reasons we are in this mess is because the government of the baby-boomers prime time chose to privatise all the utilities so that their generation could reap the profits of the hard-won investments made by the previous generations who fought and survived a world war and built a nation that was largely independent.

Now we have a government that remains in power by looking after the same generation as they are currently the largest voter base. As a result of this they will do whatever they can to appease the retired baby boomers who want to hold onto their material wealth till they go to the grave. This government will gladly endebt future generations to a life of poverty, even starvation to hold onto the votes of the wealthy baby boomers.

On Friday I saw a prime example of the unashamed self and greed of that generation was when I was waiting for my  colleagues after the checkout in aldi having bought a sandwich for lunch. A smartly dressed old man in apparent good health wearing a face mask walked by with a bag of groceries. He stopped by the food bank donation point and looked at its contents, then removed 3 items from it to put in his shopping bag, before walking out to an almost new car with a personalised plate, which was parked in a disabled space with no disabled badge.

I wanted to confront him politely but I was with a couple of colleagues who didn't witness the theft so I feared to do anything in case it escalated and I lost my cool. Unlike the greedy selfish old man who has a guaranteed income from probably a final salary pension until the day he dies, I have a family to provide for and would lose my income if any major legal issues occurred.

I've never, ever seen anyone removing items from a food bank donation point in all the years they have been there until this. Previously I thought that this is the sort of thing chavs do, not wealthy retired people. My perception changed a lot after joining this forum and friday has turned my perception on its head.

[Deleted User]

littleteapot said:

Yep standard human mentally. Want to have a cake, eat all of it, and still have a whole cake for tomorrow. 

One of the biggest reasons we are in this mess is because the government of the baby-boomers prime time chose to privatise all the utilities so that their generation could reap the profits of the hard-won investments made by the previous generations who fought and survived a world war and built a nation that was largely independent.

Now we have a government that remains in power by looking after the same generation as they are currently the largest voter base. As a result of this they will do whatever they can to appease the retired baby boomers who want to hold onto their material wealth till they go to the grave. This government will gladly endebt future generations to a life of poverty, even starvation to hold onto the votes of the wealthy baby boomers.

On Friday I saw a prime example of the unashamed greed of that generation was when I walked to aldi to get a sandwich for lunch. An old man in apparent good health wearing a face mask walked by with a bag of groceries. He stopped by the food bank donation point and looked at its contents, then removed 3 items from it to put in his shopping bag, before walking out to an almost new model car with a personalised plate.

I wanted to confront him politely but I was with a couple of colleagues who didn't witness the theft so I feared to do anything in case it escalated and I lost my cool. Unlike the greedy selfish old man who has a guaranteed income from probably a final salary pension until the day he dies, I have a family to provide for and would lose my income if any major legal issues occurred.

Not all the baby boomer generation (I was born between the boomer years) are wealthy - some are no doubt but many aren't in spite of what you witnessed at Aldi.  I know I'm not.  Not quite into the 'fuel poverty' bracket ATM but about to smash into it come October big time where I estimate some 20+% of my disposable income will be used for energy.   Bit of an over-generalisation to tar us all with the same brush!

daz378

There is no way   that the poorer parts of society    can afford this increase in energy bills....never mind the rising rents...but rising global energy prices are a macroeconomic fact...how long will high prices last? Civil unrest?lack of energy storage  makes it worse....will the government pay the political cost or try to bribe us before the election?

michaels

daz378 said:

There is no way   that the poorer parts of society    can afford this increase in energy bills....never mind the rising rents...but rising global energy prices are a macroeconomic fact...how long will high prices last? Civil unrest?lack of energy storage  makes it worse....will the government pay the political cost or try to bribe us before the election?

Lets see - 'will the govt try to bribe the electorate using their own money in the run up to the next election?' - tricky question.

Problem is when it comes to gas is that it is not UK sellers the govt has to dupe with freshly minted money but foreign sellers who may just decide that all those lovely pound coins that we seem to think we can produce an unlimited supply of are not actually worth much and they would rather take Swiss Francs or Chinese Yuan or even Euros for their gas - at least if they get Euros they can swap them for Audis, what can they exchange their pounds for?  Peppa Pig merch?

Richiem1987

I think the cost living is not going to go away any time soon. The Government could give out handouts, but all that will do is add to the National Debt, push up inflation even further and push interest rates into double digits (I hear Liz Truss wants control over Interest rates from the BoE). 

I expect we will see a flurry of renters and home owners downsizing over the next two years. Those at the bottom of the market will end up combining two households into one (overcrowding) and then those in larger properties downsizing and selling up. I think we will then see a fair drop in value of those larger hosues and houses with poor EPC scores, with smaller properties with better EPC scores holding value. Yes, it may mean young families moving back in with parents etc to share the cost burden, and several kids (boys and girls) sharing the same room. We are already seeing families cutting back on subscription TV and things like Amazon Prime, cuts to mobile phone contracts and downgrading broadband packages. That's not going to be enough. 

Many will also downgrade their cars or sell the 2nd car. 

I think larger households (as in number of people living under one roof) is going to see a big rise in the next two years as LLs offload their housing stock and Lenders reposses properties. I also think some of those repossesed properties will get snapped up by housing associations who are desperate for housing stock. 

I can't see any other way people will be able to afford it and I think the above is going to be the only way to achieve it and stay alive and paying their bills. This is relevant to this thread, as it is the cost of Energy as the route cause.

Woolsery

littleteapot said:

Yep standard human mentally. Want to have a cake, eat all of it, and still have a whole cake for tomorrow. 

One of the biggest reasons we are in this mess is because the government of the baby-boomers prime time chose to privatise all the utilities so that their generation could reap the profits of the hard-won investments made by the previous generations who fought and survived a world war and built a nation that was largely independent.

Now we have a government that remains in power by looking after the same generation as they are currently the largest voter base. As a result of this they will do whatever they can to appease the retired baby boomers who want to hold onto their material wealth till they go to the grave. This government will gladly endebt future generations to a life of poverty, even starvation to hold onto the votes of the wealthy baby boomers.

On Friday I saw a prime example of the unashamed self and greed of that generation was when I was waiting for my  colleagues after the checkout in aldi having bought a sandwich for lunch. A smartly dressed old man in apparent good health wearing a face mask walked by with a bag of groceries. He stopped by the food bank donation point and looked at its contents, then removed 3 items from it to put in his shopping bag, before walking out to an almost new car with a personalised plate, which was parked in a disabled space with no disabled badge.

I wanted to confront him politely but I was with a couple of colleagues who didn't witness the theft so I feared to do anything in case it escalated and I lost my cool. Unlike the greedy selfish old man who has a guaranteed income from probably a final salary pension until the day he dies, I have a family to provide for and would lose my income if any major legal issues occurred.

I've never, ever seen anyone removing items from a food bank donation point in all the years they have been there until this. Previously I thought that this is the sort of thing chavs do, not wealthy retired people. My perception changed a lot after joining this forum and friday has turned my perception on its head.

You provide a single example in this diatribe against the mass of elderly people and it's all classic divide and rule stuff, but please remember not all of us in the generation under discussion voted for privatisation, nor did we necessarily fare well in amassing personal  fortunes. I would dare to suggest the bulk of us are like me, living on less than the average wage in that precarious place somewhere between comfortable living and hand-outs..

Reading again, I have the feeling you'd like to see the redistribution of whatever we older people have amassed and that's roughly what many influential persons in the world of high finance seem to have in mind too, drawing upon socialist models, like China. You will note, however, while prescribing what is good for us, the people, such persons do not lead by example and travel the world in private jets leaving a massive carbon footprint in their wake. I fear the bugs they plan to use as substitutes for polluting cattle will not be on their personal menus either, despite their undoubtedly strong credentials in moving us towards net zero

Follow these people and their celebrity acolytes if you like, but don't for a moment imagine you're one of them.

MattMattMattUK

wittynamegoeshere said:

There are some pretty cold statements made on here, by presumably fairly wealthy people who appear to have zero empathy for those that simply can not afford the basic costs of living. I get the impression that a significant number of vociferous posters on this forum could have a substantial financial or career interest within the industry

That seems to be your way of dismissing arguments, rather than attempting to address them. If you do not agree with someone's position then they either work for the company involved, are wealthy and uncaring etc.

wittynamegoeshere said:

and seem very keen to sometimes pretty insultingly put down those who question the status quo.  I don't know what the motive is, but the end result is often unpleasant to read.

Most people have no problem with those who question the status quo, indeed most of us do, but we also recognise that any alternative has to be workable, viable, fundable and possible to implement without huge negative consequences. The idea that we can just borrow, or tax companies into bankruptcy so that we can give ever increasing handouts is not a viable solution. What you find "unpleasant to read" is the reality of how the world works, because most of us know we cannot destroy the economy, inward investment, or just confiscate private property without dire wider consequences. 

wittynamegoeshere said:

The glaring elephant in the room is that SOME of our energy comes from imported energy sources so is subject to world events.

Yes, about 55% of our electricity and gas combined is imported.

wittynamegoeshere said:

The issue is that we are selling our own home-grown energy to ourselves for pretty much the same price as it would cost to import, and this is often passed off as being due to the holy rules of market forces.

That is because it is not "our" energy, it is owned by private companies because the government previously sold it to them whilst it was/is still in the ground. Other countries like Norway, or Saudi Arabia kept the fossil fuels under state ownership, they did not sell them, so the government can do as it chooses with fossil fuels it owns. 

wittynamegoeshere said:

This means that the overall energy mix is costing the suppliers the same amount as entirely imported energy would cost, and those who happen to run the energy resources are making a massive windfall profit, at the expense of the entire population of the country.

It means that we have to pay the market rate, for energy we buy on the market, just as everyone else who buys on the market does. If you do not own something then you have to buy it, you do not just get to steal it off someone because that is the cheaper option. 

wittynamegoeshere said:

I now await the usual insulting jokes about communism etc etc.

It is not "insulting jokes" and the sensible people have not made any jokes about communism. What is the issue is people keep making demands, whilst having little to no understanding of the system or legal structure in place, as well as having no idea of the consequences of their desired actions. The solution is that the UK needs to be energy independent, large scale, government funded and owned nuclear power would be the way to go, with renewables as a part of the mix. The economic suicide of either huge borrowing, taxing companies into oblivion or confiscation of private property that you and some others propose is not a solution.