£2500 Price Cap Martin's view

TheGardener

The way energy is sold is confusing. The way petrol is sold is simple and everyone I ever met 'gets it' The terminology of bills, units, kWh etc needs to be simplified.
People do need to understand a kWh is simply a unit of measurement just like a litre of petrol, a pound of sugar and a kg of rice. It's not rocket science. 
I agree with everyone who has commented on this and that the 'cap' price is meaningless. Where cash is involved, people will soon learn how many units they need to put the CH on for a month or use a washing machine.

Has anyone seen Currys new 'energy calculator' when you look at white goods online? The industry is moving (ok, baby steps) to promote efficiency, and now half the UK have bought an energy monitoring smart plug, the manufacturers might get a bit more accurate on their claims of energy consumption of their product rather than have bad publicity and risk small claims being made for 'misrepresentation' 

sienew

michaels said:

MattMattMattUK said:

sienew said:

busybee100 said:

Anyone worried about the future cost and "paying it back" should consider the future without the cap. Those people you think shouldn't get help will have less money to spend. Businesses will go under very quickly with the double whammy of higher energy prices and no disposable income.

But is the energy price going to be significantly cheaper in 18 months? The current predicted peak is £6,616, we would need to fall 68% in the 12 months following that to get back to this frozen level.

The question is... are we just delaying the inevitable at an incredible cost that probably FAR exceeds £100 BILLION. It's highly likely that we find ourselves at or above the October cap in 18 months anyway, that still would require an almost 50% drop in prices in the 12 months following April 2023.

My gut feeling is that we will end up with a permeant energy subsidy, funded from general taxation, probably with the "cap" rising with inflation in future years, or possibly a inflation plus methodology. 

sienew said:

busybee100 said:

And we need to invest in green energy and nuclear. We need to be self sufficient.

An additional question is, if we are just delaying the price rises for 18 months aren't we maybe better investing that £100,000,000,000 in energy self sufficiency that won't last 18 months but would last closer to 50 years and probably set us up with cheaper and more secure energy for at least the next 100 years.

As an example you could build 4 Hinkley Point C's for £100B, each expected to supply 7% of the UK's energy needs. The expected lifetime is at least 60 years. And this isn't even our cheapest form of energy production. Our country could become energy self sufficient for generations for the cost of an 18 month support package.

*100B is the base package predictions in the media, the full package to consumers seems to be closer to £150B and could reasonably end up being £200B. Then they are talking about support for businesses which depending on what they do possibly even take the cost to £300B.

I agree, we also need to bring the costs down, which we could by government funding and a mass building program (5 plants/10 reactors a year initially, increasing to 20+ reactors a year for a decade or more), estimates are that if we operated a mass nuclear building program we could be installing new nuclear for around £3.4 billion per megawatt of production capacity. 

Wouldn't 10 Hinkley Point C size reactors meet all our current electricity needs?  Even assuming we move all our gas and transport to electric as well wouldn't 30-40 be enough?  Where does 20 per year come in?

Yes. Hinkley Point C alone is supposed to supply at least 7% of our energy needs. We also have fairly decent renewable energy (especially wind that's about 25% of our supply) that could be improved upon cheaper than nuclear. We certainly wouldn't need 40 Hinkley Point C's unless we wanted to become an energy super power exporting all that excess energy.

When he said 40 I think Matt might have been talking about mini nuclear plants that are being proposed and worked on.

MattMattMattUK

michaels said:

MattMattMattUK said:

sienew said:

busybee100 said:

Anyone worried about the future cost and "paying it back" should consider the future without the cap. Those people you think shouldn't get help will have less money to spend. Businesses will go under very quickly with the double whammy of higher energy prices and no disposable income.

But is the energy price going to be significantly cheaper in 18 months? The current predicted peak is £6,616, we would need to fall 68% in the 12 months following that to get back to this frozen level.

The question is... are we just delaying the inevitable at an incredible cost that probably FAR exceeds £100 BILLION. It's highly likely that we find ourselves at or above the October cap in 18 months anyway, that still would require an almost 50% drop in prices in the 12 months following April 2023.

My gut feeling is that we will end up with a permeant energy subsidy, funded from general taxation, probably with the "cap" rising with inflation in future years, or possibly a inflation plus methodology. 

sienew said:

busybee100 said:

And we need to invest in green energy and nuclear. We need to be self sufficient.

An additional question is, if we are just delaying the price rises for 18 months aren't we maybe better investing that £100,000,000,000 in energy self sufficiency that won't last 18 months but would last closer to 50 years and probably set us up with cheaper and more secure energy for at least the next 100 years.

As an example you could build 4 Hinkley Point C's for £100B, each expected to supply 7% of the UK's energy needs. The expected lifetime is at least 60 years. And this isn't even our cheapest form of energy production. Our country could become energy self sufficient for generations for the cost of an 18 month support package.

*100B is the base package predictions in the media, the full package to consumers seems to be closer to £150B and could reasonably end up being £200B. Then they are talking about support for businesses which depending on what they do possibly even take the cost to £300B.

I agree, we also need to bring the costs down, which we could by government funding and a mass building program (5 plants/10 reactors a year initially, increasing to 20+ reactors a year for a decade or more), estimates are that if we operated a mass nuclear building program we could be installing new nuclear for around £3.4 billion per megawatt of production capacity. 

Wouldn't 10 Hinkley Point C size reactors meet all our current electricity needs?  Even assuming we move all our gas and transport to electric as well wouldn't 30-40 be enough?  Where does 20 per year come in?

The UK uses 1,651,000,000 MWh of power in a year across all uses (electricity, gas, petroleum, diesel and aircraft fuel). Hinkley Point C is 2 reactors in one power plant, producing 3,200 MWe of electrical power. To meet all our power needs ignoring transmission losses, charging losses for EVs etc. we would need around 60 plants (with two reactors each), when accounting for those, as well as likely future hydrogen production needs, population growh, spare capacity for outages and maintenance as well as ideally export capacity as well we would likely need 100-120 plants, 200-240 reactors, so even at 20 a year after scaling up it would take 18 years to begin construction on all sites, 23-25 years to complete the build program. 

MattMattMattUK

sienew said:

michaels said:

MattMattMattUK said:

sienew said:

busybee100 said:

Anyone worried about the future cost and "paying it back" should consider the future without the cap. Those people you think shouldn't get help will have less money to spend. Businesses will go under very quickly with the double whammy of higher energy prices and no disposable income.

But is the energy price going to be significantly cheaper in 18 months? The current predicted peak is £6,616, we would need to fall 68% in the 12 months following that to get back to this frozen level.

The question is... are we just delaying the inevitable at an incredible cost that probably FAR exceeds £100 BILLION. It's highly likely that we find ourselves at or above the October cap in 18 months anyway, that still would require an almost 50% drop in prices in the 12 months following April 2023.

My gut feeling is that we will end up with a permeant energy subsidy, funded from general taxation, probably with the "cap" rising with inflation in future years, or possibly a inflation plus methodology. 

sienew said:

busybee100 said:

And we need to invest in green energy and nuclear. We need to be self sufficient.

An additional question is, if we are just delaying the price rises for 18 months aren't we maybe better investing that £100,000,000,000 in energy self sufficiency that won't last 18 months but would last closer to 50 years and probably set us up with cheaper and more secure energy for at least the next 100 years.

As an example you could build 4 Hinkley Point C's for £100B, each expected to supply 7% of the UK's energy needs. The expected lifetime is at least 60 years. And this isn't even our cheapest form of energy production. Our country could become energy self sufficient for generations for the cost of an 18 month support package.

*100B is the base package predictions in the media, the full package to consumers seems to be closer to £150B and could reasonably end up being £200B. Then they are talking about support for businesses which depending on what they do possibly even take the cost to £300B.

I agree, we also need to bring the costs down, which we could by government funding and a mass building program (5 plants/10 reactors a year initially, increasing to 20+ reactors a year for a decade or more), estimates are that if we operated a mass nuclear building program we could be installing new nuclear for around £3.4 billion per megawatt of production capacity. 

Wouldn't 10 Hinkley Point C size reactors meet all our current electricity needs?  Even assuming we move all our gas and transport to electric as well wouldn't 30-40 be enough?  Where does 20 per year come in?

Yes. Hinkley Point C alone is supposed to supply at least 7% of our energy needs. We also have fairly decent renewable energy (especially wind that's about 25% of our supply) that could be improved upon cheaper than nuclear. We certainly wouldn't need 40 Hinkley Point C's unless we wanted to become an energy super power exporting all that excess energy.

Not 7% off our energy needs, 7% of our current electrical needs, ignoring the need to phase out gas and oil heating and ignoring the additional capacity needed for complete ground vehicle electrification and long term hydrogen production for air transport. 

sienew said:

When he said 40 I think Matt might have been talking about mini nuclear plants that are being proposed and worked on.

SMRs could play a role, the target capacity for the RR SMR is 2 MWe, other designs are considerably smaller (<1 MWe), it may be that in 5-7 years they could be brought into the mix in terms of the types of reactor built, but being smaller there would need to be more of them. 

sienew

MattMattMattUK said:

sienew said:

michaels said:

MattMattMattUK said:

sienew said:

busybee100 said:

Anyone worried about the future cost and "paying it back" should consider the future without the cap. Those people you think shouldn't get help will have less money to spend. Businesses will go under very quickly with the double whammy of higher energy prices and no disposable income.

But is the energy price going to be significantly cheaper in 18 months? The current predicted peak is £6,616, we would need to fall 68% in the 12 months following that to get back to this frozen level.

The question is... are we just delaying the inevitable at an incredible cost that probably FAR exceeds £100 BILLION. It's highly likely that we find ourselves at or above the October cap in 18 months anyway, that still would require an almost 50% drop in prices in the 12 months following April 2023.

My gut feeling is that we will end up with a permeant energy subsidy, funded from general taxation, probably with the "cap" rising with inflation in future years, or possibly a inflation plus methodology. 

sienew said:

busybee100 said:

And we need to invest in green energy and nuclear. We need to be self sufficient.

An additional question is, if we are just delaying the price rises for 18 months aren't we maybe better investing that £100,000,000,000 in energy self sufficiency that won't last 18 months but would last closer to 50 years and probably set us up with cheaper and more secure energy for at least the next 100 years.

As an example you could build 4 Hinkley Point C's for £100B, each expected to supply 7% of the UK's energy needs. The expected lifetime is at least 60 years. And this isn't even our cheapest form of energy production. Our country could become energy self sufficient for generations for the cost of an 18 month support package.

*100B is the base package predictions in the media, the full package to consumers seems to be closer to £150B and could reasonably end up being £200B. Then they are talking about support for businesses which depending on what they do possibly even take the cost to £300B.

I agree, we also need to bring the costs down, which we could by government funding and a mass building program (5 plants/10 reactors a year initially, increasing to 20+ reactors a year for a decade or more), estimates are that if we operated a mass nuclear building program we could be installing new nuclear for around £3.4 billion per megawatt of production capacity. 

Wouldn't 10 Hinkley Point C size reactors meet all our current electricity needs?  Even assuming we move all our gas and transport to electric as well wouldn't 30-40 be enough?  Where does 20 per year come in?

Yes. Hinkley Point C alone is supposed to supply at least 7% of our energy needs. We also have fairly decent renewable energy (especially wind that's about 25% of our supply) that could be improved upon cheaper than nuclear. We certainly wouldn't need 40 Hinkley Point C's unless we wanted to become an energy super power exporting all that excess energy.

Not 7% off our energy needs, 7% of our current electrical needs, ignoring the need to phase out gas and oil heating and ignoring the additional capacity needed for complete ground vehicle electrification and long term hydrogen production for air transport. 

Sorry, yes, you are correct. That was what I meant but accidentally misspoke.

[Deleted User]

TheGardener said:

The way energy is sold is confusing. The way petrol is sold is simple and everyone I ever met 'gets it' The terminology of bills, units, kWh etc needs to be simplified.
People do need to understand a kWh is simply a unit of measurement just like a litre of petrol, a pound of sugar and a kg of rice. It's not rocket science. 
I agree with everyone who has commented on this and that the 'cap' price is meaningless. Where cash is involved, people will soon learn how many units they need to put the CH on for a month or use a washing machine.

Has anyone seen Currys new 'energy calculator' when you look at white goods online? The industry is moving (ok, baby steps) to promote efficiency, and now half the UK have bought an energy monitoring smart plug, the manufacturers might get a bit more accurate on their claims of energy consumption of their product rather than have bad publicity and risk small claims being made for 'misrepresentation' 

What on earth needs to be simplified?

You buy energy in units called kWh and each kWh has a price.  You buy petrol in units called litres and each litre has a price.

If you buy more kWh then you spend more money.  If you buy more litres then you spend more money.

The only slightly confusing part (and I have no idea why it's confusing) is standing charge.  That's just saying that you rent your connection to the electricity grid for £170 per year and rent your connection to the gas grid for £100 per year.

It is entirely trivial.

eastcorkram

[Deleted User] said:

TheGardener said:

The way energy is sold is confusing. The way petrol is sold is simple and everyone I ever met 'gets it' The terminology of bills, units, kWh etc needs to be simplified.
People do need to understand a kWh is simply a unit of measurement just like a litre of petrol, a pound of sugar and a kg of rice. It's not rocket science. 
I agree with everyone who has commented on this and that the 'cap' price is meaningless. Where cash is involved, people will soon learn how many units they need to put the CH on for a month or use a washing machine.

Has anyone seen Currys new 'energy calculator' when you look at white goods online? The industry is moving (ok, baby steps) to promote efficiency, and now half the UK have bought an energy monitoring smart plug, the manufacturers might get a bit more accurate on their claims of energy consumption of their product rather than have bad publicity and risk small claims being made for 'misrepresentation' 

What on earth needs to be simplified?

You buy energy in units called kWh and each kWh has a price.  You buy petrol in units called litres and each litre has a price.

If you buy more kWh then you spend more money.  If you buy more litres then you spend more money.

The only slightly confusing part (and I have no idea why it's confusing) is standing charge.  That's just saying that you rent your connection to the electricity grid for £170 per year and rent your connection to the gas grid for £100 per year.

It is entirely trivial.

What needs to be simplified is the way the cap is referred to in terms of annual spend.

Imagine if it was petrol that was getting expensive, to the point where everyone was panicking and saying we won't be able to afford it . Then the government say, don't worry, we're going to cap the price of petrol. They'd surely cap the price per litre. They wouldn't then try to manufacture a figure of what the average driver uses in a year.

sienew

eastcorkram said:

[Deleted User] said:

TheGardener said:

The way energy is sold is confusing. The way petrol is sold is simple and everyone I ever met 'gets it' The terminology of bills, units, kWh etc needs to be simplified.
People do need to understand a kWh is simply a unit of measurement just like a litre of petrol, a pound of sugar and a kg of rice. It's not rocket science. 
I agree with everyone who has commented on this and that the 'cap' price is meaningless. Where cash is involved, people will soon learn how many units they need to put the CH on for a month or use a washing machine.

Has anyone seen Currys new 'energy calculator' when you look at white goods online? The industry is moving (ok, baby steps) to promote efficiency, and now half the UK have bought an energy monitoring smart plug, the manufacturers might get a bit more accurate on their claims of energy consumption of their product rather than have bad publicity and risk small claims being made for 'misrepresentation' 

What on earth needs to be simplified?

You buy energy in units called kWh and each kWh has a price.  You buy petrol in units called litres and each litre has a price.

If you buy more kWh then you spend more money.  If you buy more litres then you spend more money.

The only slightly confusing part (and I have no idea why it's confusing) is standing charge.  That's just saying that you rent your connection to the electricity grid for £170 per year and rent your connection to the gas grid for £100 per year.

It is entirely trivial.

What needs to be simplified is the way the cap is referred to in terms of annual spend.

Imagine if it was petrol that was getting expensive, to the point where everyone was panicking and saying we won't be able to afford it . Then the government say, don't worry, we're going to cap the price of petrol. They'd surely cap the price per litre. They wouldn't then try to manufacture a figure of what the average driver uses in a year.

It's a little different though as most people only drive 1 car. So maybe it costs me £50 at the petrol station, I know roughly how far I can get on that (measured in either miles or days) and if it goes up to £60 next week I know there has been a rise.

Energy is a little different as most people have 30+ things using electric and gas use varies significantly by day. It's very difficult to know how much each is using and how that translates to % of bill or cost. My gas use today (it's 3pm and I've used none) is very different to what it will be in January when I have the heating on most of the day.

PennyForThem_2

Then - if it is that simple - why is it that there is a common assumption that the DD covers use? 

sienew

PennyForThem_2 said:

Then - if it is that simple - why is it that there is a common assumption that the DD covers use? 

True. A lot of people who come to these forums for the first time somehow believe that if their fix is for £200 that they can use as much energy as they want for that price rather than it being based on estimated usage. There is a massive lack of understanding when it comes to energy bills.