GB Energy Price Hike
Comments
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The big6 buy their energy years in advance and basically gamble with prices and hope it pays off. They have said as much*.Really?
GB Energy will need to obtain sufficient supplies to cover their expected demand from their customer base. As they seem to be shifting their tariffs towards one year fixes with regular new tariffs (as per other Suppliers), they will purchase at market rates.
On top of that, they will cover overheads and their profit margin.
I don't think volume discounts apply. If they did, no new entrant could possibly compete, let alone be market leaders on price as GB Energy have been for some time.
The market doesn't work on bartering just because someone has a big bank balance.
Smaller suppliers are buying their energy at current rates. Currently the rates are good, so little suppliers are booming. Things may change in the future though, and the gambles of the big6 may make them much more competitive than the smaller suppliers, pushing them out.
*In fact, they use it as their token excuse as to why their prices don't track the market and reduce along with the cost of basic fuel.0 -
I agree that many suppliers and in particular the big 6 will advance purchase capacity to cover their respective demand. I am sure GB Energy also do this with a timescale that is likely to be shorter.
The former is no guarantee of success because oil price volatility can throw the gamble (hedge) out of kilter. GB Energy have a massively smaller customer base so their cash requirement to advance purchase will depend on their available funds.Proportionately, they may be advance purchasing to the same level.
They may or may not be cash rich depending on how they are funded by investors.
I think there are a lot of assumptions flying around here which may not be at all relevant to individual companies.
I personally wish them good luck because if we have this competitive market I like the new entrants like OVO , a few years back, and GB to do well as that breaks the complacent club of the big 6.
This thread has gone from unfair criticism of GB on price to doom and despair about their future prospects. Harsh in my humble opinion. All we can judge is what their offer currently is and as far as I am concerned it is good for me on electricity.0 -
Nobody here has said anything bad will happen to GB Energy, just that smaller suppliers are more vulnerable when the market is less favourable.This thread has gone from unfair criticism of GB on price to doom and despair about their future prospects. Harsh in my humble opinion. All we can judge is what their offer currently is and as far as I am concerned it is good for me on electricity.
You seem to be fighting an argument nobody else is having.0 -
Nobody here has said anything bad will happen to GB Energy, just that smaller suppliers are more vulnerable when the market is less favourable.
You seem to be fighting an argument nobody else is having.
I have been responding to the Original Poster who has imho unfairly criticised GB Energy about prices and have misunderstood what variable tariffs mean. They have also ignored that that GB energy still have one of the best fixed term electricity tariffs, which they deemed to be ransom if they took it up.:rotfl:
Then the poster Bark01 said directly that most of the smaller Suppliers would go out of business.(on a thread specifically about GB Energy)
You must have missed those points.:D0 -
Well yes, the OP is clearly on a rant.I have been responding to the Original Poster who has imho unfairly criticised GB Energy about prices and have misunderstood what variable tariffs mean. They have also ignored that that GB energy still have one of the best fixed term electricity tariffs, which they deemed to be ransom if they took it up.:rotfl:
Could you please point out where Bark01 said "smaller suppliers would go out of business"?Then the poster Bark01 said directly that most of the smaller Suppliers would go out of business.(on a thread specifically about GB Energy)
The closest I can see is this:
Which was a direct response to this:What would you rather do, lose customer or go bust.
The way I read the situation, Bark01 was defending GB Energy's decision to raise prices. In the wake of rising wholesale energy costs, GB Energy had two options; 1) Raise variable prices in line with wholesale costs in order to maintain cash flow and keep the company running. 2) Keep the same prices even though their costs had increased, hemorrhaging money until the company folds.The_Green_Hornet wrote: »I wonder how many customers GB Energy Supply will lose because of this price hike.
GB Energy seem to have taken the sensible option of staying in business.
Therefore,
Simply points out that GB Energy are going to risk losing a few customers (through a price rise), in order to remain in business.What would you rather do, lose customer or go bust.
I feel that you have missed a few points.You must have missed those points.:D0 -
Well yes, the OP is clearly on a rant.
Could you please point out where Bark01 said "smaller suppliers would go out of business"?What would you rather do, lose customer or go bust.
There's a reason Ofgem are trying to push through new rules on what to do when suppliers go bust.
Energy prices are increasing and its very likely most of the smaller suppliers will go out of business as they don;t have the finances to have a large hedging window.
It was in the very same post. I have highlighted it, because you have missed it again.
You seem strangely intent on arguing the toss with my input rather than the substance of the thread. Oh well. :beer:0 -
Fixed, no exit Fee :
So if on Variable, I guess this makes Fixed a no-brainer ?0 -
I've on the Premium Energy Saver Tariff with GB Energy, and I've just received an email saying that says
" Because wholesale prices have increased, from 13 Nov 2016, the price you pay for your electricity is increasing from 10.24p per kWh to 13.59p per kWh. Your electricity standing charge has increased from 16.10p per day to 24.28p per day..."
For me that translates to a whopping 34% increase in cost !!
Naturally I switched suppliers within 30 minutes of their email. If anyone else is on this Tariff I suggest you check it out very quickly.0 -
Hi
I used moneysupermarket, and the cheapest for me was a company called IRESA. They are actually a company that you can't join through MS, so I went to them dirct.
Interestingly, I've just realised that GB put their tariff up in August by about 7%, so that makes a total increase of almost 44% !!0
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