Will the cost of living return to normal?

anotheruser

I do wish people wouldn't say "what's normal" or whatever.
Are you seriously not understanding what the OP means?  Or do they need to be absolutely specific to the nth degree?

Seems to be the new fashion these days - purposefully act like some sort of criminal case and need everything explaining like a Tolkien novel.


In answer to the question:

No, I don't think so.

People will adjust and get used to higher prices and companies will continue to charge those prices as they still sell their goods.  Not sure prices will ever fall to what they generally were 2/3 years ago.

ProDave

Rob_Harrold said:

niktheguru said:

The utility companies don't pick random numbers for direct debits. They predict it depending on your usage and the accuracy of your bills. The problem is, most peoples bills are not accurate as they dont supply regular meter readings. As a result the direct debits are not accurate and then people get irate why the amount taken is too low or high. That was partly why smart meters were introduced so this problem doesn't happen, but there is a section of people resistant to change as they think the smart meters will result in doom and gloom.

I agree with the point on smart meters and have benefited with their accuracy for over 10 years which has allowed our household to know roughly how much energy we use per annum. Unfortunately consecutive energy companies still over estimate the usage and is reflected in our monthly direct debit which has increased to £254 for 2022/23. This will mean a rebate in October yet again because they only review payments twice a year and not monthly, meaning that the impact on other households will be even more severe because the data held by the provider is not actively reviewed. 

My dumb meter has always told me precicely how much electricity I use, and being with a sensible supply company, Octopus, they let me set my monthly DD to exactly match the energy I expect to use over the next year.

wittynamegoeshere

It's highly unlikely we'll be getting new supplies from Russia any time soon, and existing supplies are being ended.  Germany is currently running on Russian gas that they stored while the pipeline was running, but this probably won't be an option next year.  They may build some LNG terminals and outbid us for the supplies we're currently getting.  There are only so many tanker ships, and they can't be built quickly.  So demand within Europe outstrips supply therefore prices will remain high for some time.  The only short-term solution is to reduce demand, but this won't happen while governments are subsidising it.

Ukraine has big unexploited oil and gas resources.  By a strange (!) coincidence they happen to be located in all the places that Putin decided needed "liberating" by force, just after they were discovered.  At some point it's likely that Ukraine will sell gas to Europe, possibly plus a reformed Russia, but none of this is going to happen for lots of years.

So normal is probably the sort of prices we have now, or higher, at least for the next couple of years.  Probably a few blackouts too.

Chrysalis

The problem with things like the EPG is it can potentially set the level as a new sociable acceptable pricing level which reduces the chances of costs going below it again.
Also the current negotiations to delink energy costs, in return we may be agreeing to pay above market rates as a compensation factor which also reduces the chance of going back to pre Oct 2021 costs.

The only thing that would make me confident is nationalisation of energy extraction but we clearly not going down that path.

tghe-retford

Sadly not.

Russia is now forging healthy relations with China who in turn with them are getting India, Pakistan, the Middle East, Africa and Central and South America on side. The places that produce the fuel, components, materials and food we need for a sustainable green lifestyle or the fuel we need now or the goods and foods we consume.

We also have the consequences of lockdown and quantitative easing to deal with. And the failure to invest in energy security, keeping in mind the last paragraph as to where we source the wind turbine blades, the minerals for the solar panels and lithium batteries, where our oil and gas comes from and so forth.

The cost of living will not be returning to normal because our opponents hold all the aces.