Price cap.....put simply

maxmycardagain

Can anyone explain why, with record profits  ( E.G. British Gas Energy pre-tax profits of £98 million in the first half of 2022) Liz Truss has a plan to give billions out to them in interest free loans?

maxmycardagain

[Deleted User] said:

maxmycardagain said:

so basically, my gas and leccy will cost twice what im paying now on October 1st?

That entirely depends on what tariff you are on now and what tariff you will be on then.

Leccy 28p/gas 7p

maxmycardagain

British Gas owner Centrica said adjusted operating profit for the six months ending in June rose to £1.34bn from £262m a year earlier

sully1311

Oh, here we go again...

facade

maxmycardagain said:

Can anyone explain why, with record profits  ( E.G. British Gas Energy pre-tax profits of £98 million in the first half of 2022) Liz Truss has a plan to give billions out to them in interest free loans?

Because the gazillions of pounds profit is being made by companies that sell gas out of the ground to energy suppliers. They should be called "energy producers"

Then what we call "energy suppliers" should be called "energy resellers" (or middle-men)

Centrica suck gas out of the ground under the North sea, and then sell it to their own company British Gas for stupendous amounts, then British gas add 2% on an sell it to us.

If The reseller is to sell us gas for less than they buy it for, they will go bust, so the loan is to fund the drop in price between buying and selling.

We just don't understand how business works

maxmycardagain

So its Eon's profits I should look at?

E.ON has announced it has made £3.47 billion in the first six months of the year.

Publishing the half-year results today, the energy supplier of almost six million UK households and many more around the world said the company performed “as anticipated” in the first half of 2022, despite the difficult environment.

Section62

maxmycardagain said:

So its Eon's profits I should look at?

E.ON has announced it has made £3.47 billion in the first six months of the year.

Publishing the half-year results today, the energy supplier of almost six million UK households and many more around the world said the company performed “as anticipated” in the first half of 2022, despite the difficult environment.

You'd be better starting with copyright law.  If you copy and paste chunks of other people's published work you should acknowledge the source.  Doing so also helps other posters find the same information to check the context and accuracy.

Then you could read the multiple threads on this board explaining the difference between the regulated companies who supply energy into our homes for a profit of 1.9%, and the companies that source or generate the energy.  They may have the same or very similar names, but they are different.

Mstty

So you have derailed your own thread now?

Why not open another one I'm sure we need yet another one of these rather than using search.

TheBanker

maxmycardagain said:

British Gas owner Centrica said adjusted operating profit for the six months ending in June rose to £1.34bn from £262m a year earlier

I think Centrica's profits include profits from a lot of other businesses that they own ranging from extraction of gas to selling over-priced boiler service plans to the Local Heroes website.

https://www.reuters.com/business/energy/britains-centrica-sees-profits-soar-amid-high-energy-prices-2022-07-28/#:~:text=Centrica's adjusted operating profit for,262 million a year earlier.

Operating profits at British Gas fell 43% to 98 million pounds during the period as it needed to buy more energy in the wholesale market than expected to cover customer demand. It said it made 6 pounds per customer profit after tax in the first half of the year.

£1 per month per customer does not sound excessive to me. It is fortunate that British Gas have the resources of the Centrica group behind them otherwise they may well be in the same position as Bulb (who did not have any activities other than supply of energy). Even if this profit was removed completely, the average customer would hardly notice the £12 per annum reduction in their bill.

There is a legitimate question about whether the companies who extract oil and gas from the North Sea and sell it to other companies at wholesale prices (including other companies who may be under common ownership) are making excessive profits, but that's a consequence of the way our government sold the extraction rights to the highest bidder with no real thought about protecting our country's energy security. 

I am not trying to defend big companies here - but the root cause of this problem goes back decades to when we decided to privatise our energy systems. I wonder if some of those who rushed to 'Tell Sid' about how much profit could be made by buying shares in the newly privatised British Gas are the same people complaining today that they won't be able to pay their gas bill?

Section62

TheBanker said:

I am not trying to defend big companies here - but the root cause of this problem goes back decades to when we decided to privatise our energy systems. I wonder if some of those who rushed to 'Tell Sid' about how much profit could be made by buying shares in the newly privatised British Gas are the same people complaining today that they won't be able to pay their gas bill?

The root cause is far more complicated than that analysis.