Price hikes.

pensioner2

The word hike is meaningless and misleading [Diddly squat is as useful to describe the most recent price increases]   I understand that even the threat of a wholesale increase in fuel will lead to stories of huge hikes to the consumer.   However, actual hugangeous reductions in wholesale prices [lower than before the Ukraine invasion] will not provoke even the slightest rumour of price reductions to the consumer.... Why?     Is good news not worth reporting?     Should we just accept that our huge standing charges are the result of having to bail out failed energy companies who should be accountable for their debts.

[Deleted User]

pensioner2 said:

The word hike is meaningless and misleading [Diddly squat is as useful to describe the most recent price increases]   I understand that even the threat of a wholesale increase in fuel will lead to stories of huge hikes to the consumer.   However, actual hugangeous reductions in wholesale prices [lower than before the Ukraine invasion] will not provoke even the slightest rumour of price reductions to the consumer.... Why?     Is good news not worth reporting?     Should we just accept that our huge standing charges are the result of having to bail out failed energy companies who should be accountable for their debts.

Sadly, as consumer credits are not held in escrow, then consumers would only be due pennies in the £ as unsecured creditors when a supplier fails.  Ofgem has recently rejected escrow as it would add costs to consumer energy bills.

Mstty

There was a dip in wholesale prices over Christmas as bid industry shut down especially in Europe I read.

Should be back to normal in Jan with huge wholesale prices.

With the wind in the UK less is being spent on gas for electricity generation but this is peaks and troughs so has to be averaged out over the year.

Fast to rise slow (if ever) to fall

As for the SOLR process been discussed hundreds of times

pensioner2

It has been a long dip in wholesale prices, not just Christmas.

Mstty

pensioner2 said:

It has been a long dip in wholesale prices, not just Christmas.

Ok give me the average for the long dip in therms and megawatts. Are you talking 1 month 2-3 and what is the average.

Then adjust for the fact the wholesale price equates to 35-36% of the cost of getting the energy and administration to your door for electricity and 40-45% for gas.

Then consider what you are paying 34p and 10.3p on average.

pensioner2

Questions.....   Why is a meaningless word like hike accepted for a slight increase?    Why is a reduction in wholesale prices over a long period not reported as good news for consumers?    Why is the price of electricity related to the cost of generating with gas even when no gas is used?

Astria

pensioner2 said:

Questions.....   Why is a meaningless word like hike accepted for a slight increase?    Why is a reduction in wholesale prices over a long period not reported as good news for consumers?    Why is the price of electricity related to the cost of generating with gas even when no gas is used?

Like petrol, diesel, and everything else, if you bought fuel at £1.50/litre, and then the wholesale value drops, you can't be expected to make a loss, so it's expected that you could still be selling it for at least that, even though you can now buy it at £1.30/litre.

Considering gas is used to make the vast quantity of electric (unless we have vast quantities of renewables due to wind or sun), its understandable that the cost of gas can influence the cost of electric.

EssexHebridean

pensioner2 said:

Questions.....   Why is a meaningless word like hike accepted for a slight increase?    Why is a reduction in wholesale prices over a long period not reported as good news for consumers?    Why is the price of electricity related to the cost of generating with gas even when no gas is used?

If you're talking about the increases that some customers have seen in the past few days, then I'd suggest that they aren't "slight" - if you are a single rate electricity customer, then your increase is indeed likely to be "slight" bordering on unnoticeable, perhaps. I've seen my prices increase by around 7% though - and while that might be slight in your world, it definitely isn't in mine, or indeed in many others! 

[Deleted User]

pensioner2 said:

Questions.....   Why is a meaningless word like hike accepted for a slight increase?    Why is a reduction in wholesale prices over a long period not reported as good news for consumers?    Why is the price of electricity related to the cost of generating with gas even when no gas is used?

The Ofgem Cap is primarily set by looking back through the 'rear view' mirror. It follows that the drop in gas prices now will be reflected in the Cap set on the 1st April.

Electricity pricing in the UK and on mainland Europe is based on short-term marginal costs with the price linked to the most expensive component - usually a fossil fuel. Kwasi Kwarteng in his brief time as Chancellor did undertake to review this link but things have gone very quiet since he was moved on from his post.

If you would reactive pricing for electricity and gas then look at Octopus Agile and Octopus Tracker gas. Agile consumers were being paid to use energy earlier this week.

pensioner2

The cost of gas doesn't just influence the cost of electricity it controls it even when no gas is used.
I hope that the Cap in April does reflect the wholesale price drop but there is little in the media or on forums to promote this possibility.
I was amazed to read that there had been a 7% rise for some people.    This emphasises my point about not using meaningless words like hike.  Give us the facts.   The truth is out there.

MattMattMattUK

pensioner2 said:

The cost of gas doesn't just influence the cost of electricity it controls it even when no gas is used.
I hope that the Cap in April does reflect the wholesale price drop but there is little in the media or on forums to promote this possibility.
I was amazed to read that there had been a 7% rise for some people.    This emphasises my point about not using meaningless words like hike.  Give us the facts.   The truth is out there.

The facts are there in many of the articles, but if people only consume the headline, soundbite or social media snippet then that is their problem.