unclebuck

Gas in Britain is now the most expensive wholesale fuel in the world - even more costly than oil.

In January 2004, the average gas bill in Britain was £357, but at the start of this year it jumped to £402 and as of this week it is costing householders around £450.

Further price rises of around 15% are predicted next year. These would add £116 to the current average gas and power bill.

http://www.sky.com/skynews/article/0...469137,00.html

Another step towards the big crash.

mart360

agreed,

why the **** do we pay so much for a commodity which is essentaily ours, ie gas from the north sea..

its about time the middle man got removed and the profiteering stopped.


Mart

SJ_Skyline

Rejoined up with British Gas earlier this year, prices frozen until 2010

_RIP_

£1.65 a unit in the UK and the equivalent of 40p a unit in Germany???

mart360

but isnt the tarrif higher than normal?? and a hefty penalty charge if you decide to leave?

Mart

_RIP_

I'm with Atlantic for both gas and leccy, were the cheapest when I last looked. Oh and they just gave me 2 months free for sticking with them for a year.

SJ_Skyline

Theer was a hike at the time but doing the sums over the period - especially as prices are going up now - it made sense. I guess the only way to find out will be to see when 2010 comes round and if I'm paying substantially less then it worked and if not then oh well - put it down to experience. I'm not planning on changing supplier over the period and seeing as I've just had a new boiler fitted I won't be moving from gas to any other fuel source.

rik1471

Makes me glad to be in my apartment - gas free

Flatcapdriver

Its nothing to do with rip off Britain, although if you're gullible or stupid enough to swallow it then I suppose it makes for good headlines but its not a result of British corporate greediness.

If you want someone to blame, then try the German or French utility companies who were/are quite happy to take supplies out of the UK-Belgian interconnector but less willing for supplies to run the other way. Coupled to a major breakdown on one of the compressors that pumps product towards the UK has resulted in a distorted market driving prices up and regardless of who your gas supplier is they still buy off the beach at the same wholesale prices. The net effect of this is that there will be a big shake out in the market (as there was in the '90s) which will result in far fewer players as they realise that it is not that easy to make money when you can't control the supply.

We are no longer able to depend on North Sea gas as the UK is now a net importer of natural gas so its not a case of it "being our gas in the first place," if it ever was. Unless your energy supply is heating oil (move to LPG) I wouldn't recommend even thinking about changing fuels as the costs would be too prohibitive.

Insteas of whingeing about escalating energy costs, how many of you have improved the energy efficiency of your properties? Not many I bet. Actually, given this is Scoobynet I suspect I'll get a barrage of quickly Googled up examples of how clever you've all been but the point remains that the easiest way of reducing your heating costs is to improve the insulation on your house.

the moose

This is exactly the sort of well thought-out and sensible post that we just don't need on SN.

<unclebuck>
I blame Tony Blair
</unclebuck>

Leslie

Well I still think that they will make a bomb out of it all, like they did, and are still doing out of petrol prices. Took a long time to start reducing prices in comparison with the rapid escalation in the first place.

Of course there are rich pickings for the Exchequer when you think about the extra VAT that they take. There is no doubt that the Government has been caught with its pants down, not that they give a stuff for the electorate anyway! Bit like the 'flu jab fiasco.

My house is fully insulated FCD before you start to berate me as well as everyone else!

Les

SD

LOL, As an empoyee of the gas division of a well known oil company I concur exactly with what Flatcapdriver says. At the end of the day I think you'll find that gas companies earlier this year tried to shed seasonal clients to reduce their exposure to wholesale gas price rises. We're certainly not profiting out of it in our division thanks very much, although I'm personally pleased that my only gas appliance at home is my gas hob (last bill said 'nothing to pay'!)

Read up on the supply chain and you'll see that it isn't a case of rip off Britain at all.

Simon.

Kael

SD and Flatcapdriver - Well said.

unclebuck

Well, thankyou for that rational (if low grade) middle management style explanation - it's what we've come to expect. I will now of course be perfectly happy, no! positively delighted, that we pay more per unit for our gas supplies than anyone else in the world.

Of course, we should have known that somebody else would be to blame, but it always is somebody else's fault in this country. (Corporate management learned this technique from our illustrious government (or was it the other way round?)). This time it's those perenial favorites the 'Germans' and the 'French'. LOL

I think you'll find the only people that are 'gullible or stupid' are those that accept the spin and fail to lay the blame where it should lie - with pi$$ poor management. It seems to me that until suppliers and yes, government too, take their responsibilities seriously for securing fuel supplies to the UK at reasonable prices then they will have to expect to be blamed for playing their part in helping the country slide into recession.

the moose

Funnily enough, you always blame Tony Blair for everything, including bad weather and the fact that Southampton are a **** football team.

InvisibleMan

imagine all the gas we would get if we tapped into UB

Flatcapdriver

It's always amusing to see how you attempting to wriggle out of your way out of a yet another poorly constructed attack on Labour, when a few facts are presented that don't support your case.

If you actually knew anything about the energy market then you'd know that it is anathema to both the German and French psyche to be faced with a potential take over from foreign companies, which is why competitors are faced with such rampant protectionism in both these markets. Why do you think that the bulk of the French energy market is controlled by the French Government in the form of part or full nationalisation? Why do you think that German energy giants are virtually exempt from any takeover in the form of 'poison pill' that make any attempt financially ruinous? That protectionism prevents UK companies from any form of M&A activity with them and also explains why they are reluctant to trade more honestly with the UK when they can ensure that their own markets are more than adequately supplied.

It would be funny to see how you'd respond if Labour proposed the re-nationalisation of Centrica or BG as a way of protecting consumer's energy costs.

Apart from anything else, the reason why I was referring to 'gullible and stupid' people being taken in by this article is that it is wholly unrepresentative of current pricing and is just scaremongering at best. You can't compare the spot market to current prices enjoyed by domestic consumers abroad because the price they're paying is based on a hedged (i.e bought forward) price their supplier paid during the summer. In other words, it was lower. The wholesale price is a spot price based on today's price for delivery in one month's time so it's like comparing the cost of gas from August (warmer = lower demand) to the cost of gas in December (colder = greater demand) so there is no correlation between the two.

Now that you're trying to pin the blame on the management as well as Blair's government perhaps you can explain why the UK is embarking on some of the most ambitious planning for LNG terminals in the world, which are supported not only by local as well as national government but also by the management of these nasty rip off energy giants who are trying to secure fuel supplies for the UK at reasonable prices. Unfortunately, this doesn't happen overnight but no doubt you'd want to blame Blair for not speeding up the planning process.

SJ_Skyline

That's not gas, it's just hot air

InvisibleMan

i thought it was methane...with all that bullsh1t he produces...


Deja Moo

unclebuck

No - that's hot air. Vast quantities of it too.

Leslie

Well SD would say that wouldn't he!

Sorry that FCD should think that people are gullible and stupid when they object to yet another round of swingeing prices increases which appears on the face of it to be yet another governmental **** up!

Les

Scooby-Doo

Who do you work for then Flatcap ? I work for a major utility

Flatcapdriver

Les, I consider anyone gullible and stupid when they can't look beyond the headlines and work out what is really happening and I'm surprised that you're allowing yourself to be led so easily. I detest this government as much as the next man and Blair as much as Moose dislikes Thatcher but I'm not daft enough to blame this Government at every given opportunity when I know and have explained what the real situation is. If you want to blame the Government, then go ahead but don't expect any respect from me as someone who actually has half an idea about what and where the fault lies.

Flatcapdriver

It's like Dumb and Dumber all rolled into one. Facts are so inconvenient. Stick to debating with PS Lewis - more your style.

unclebuck

LOL - so you're the only person qualified to have an opinion then?

You don't need to be a motor mechanic to know when an engine is broken.

It's broken - we don't need excuses we need it fixed. Same applies here. We don't need lame exercises in spin and arrogant middle management twaddle - we need fairly priced energy. (The last thing we'll get of course, just poor quality customer service)

Flatcapdriver

No, you don't have to be a motor mechanic to know when an engine is broken but you do have to have the skills and knowledge to know a) why it's broken and b) how to fix it - neither of which you have in this instance.

I'm far more qualified to give a knowledgeable opinion of what is happening with regard to this issue - yes. All you want to do is trot out your usual ill informed rhetoric blaming Blair, middle management or anyone else without understanding the issues. When I have pointed out the underlying mechanics of the situation, all you have responded with is sarcasm and recycled rubbish you have read in the Sun or on Sky. When it doesn't suit your distorted view of the world you are reduced to lame attempts at ridicule which despite my willingness to educate you as to why the UK market is skewed, seems to goad you to further howls of protest about an issue you know nothing about.

As you can't understand fundamental basics such as market dynamics when they are explained to you and the reasons why they have an impact on the market, then there is no point in me trying to help you understand. I have explained in a previous post how industry and Government are ensuring that the gas market is not exposed via the construction of LNG storage over the next few years despite the usual NIMBYS voicing their opposition. I have explained the inaccuracies and flaws in the original article to you regarding the way they looked at the pricing structure - surely even you can understand that you cannot compare summer pricing at domestic level with winter pricing on wholesale spot markets? Can't you?

Doubtless, you'll dismiss this as more management twaddle as it won't fit your agenda.

scoob_babe

No, we have gas and electric from them (best deal for us at the time) and because of this there is no penalty charge. The gas tariff is slightly higher however the electricity charge has been reduced so overall the same.

logiclee

If it wasn't for Thatchers 1980's policy of rigging the generation market in favour of gas we would still have near 15 years of cheap natural gas reserves left.
The "Dash for Gas" policy of the 80's was engineered to make coal generation look expensive so the tory Government could crack the NUM and close mines.

Yes the Tory government did the country a favour on the union front but we are now paying the price. The UK's natural gas reverves have been wasted on electricity generation when we should have been looking at Clean Burn Coal technology as well as Renewables and Nuclear. The generation market is now much more of a level playing field but we have little coal capacity left. Imported coal is very expensive now as growing economies like China struggle to fill an 100million ton shortfall on thier 1.3billion ton burn for 2005.

So now we are left with a massive gap in the generation market with blackouts looking likely, plans being laid down for an expensive nuclear program and more and more gas piplines from unstable East European countries.

Two things are certain...
Gas Prices will keep rising and electricity cost will rise even further.

Cheers
Lee

Flatcapdriver

There is no certainty about rising gas prices. Short term maybe but not longer term.

^Qwerty^

It's the result of a very short sighted energy policy started by the Tories and continued to this day by Labour.

Although it looks like somebody finally realised this week that we might actually need to do something - the answer put forward, to build the next generation of nukes.

All well and good you might say, as it will cut down on CO2 emissions etc. but we are but one tiny island on a big planet.

I'm not a big fan of exporting nuclear technology to those countries that don't currently have it, or are want for a better description, unstable. Give them nuclear power stations and you also give them the ability to make bombs from the resulting waste.

China so I read, is currently in the process of commissioning a new coal powered generation station every week. Other countries will follow. CO2 emissions will go through the roof. We have no means of stopping this, because it's cheap to do. So we need to clean them up.

IMO we need to:

a) Develop and deploy clean burn technology for coal (carbon capture) and make it available to anybody who wants it in the world at cost. This takes care of the immediate short term problem and will allow countries to develop without pumping billions of tonnes of CO2 into the atmosphere.
b) Look at the long term problem of what to replace Coal with.
c) Introduce policies that encourage people to save energy (rather than just produce more to meet demand). Such policies would include solar panals on all new house builds. Even if they just heat up water, over 300,000 new houses, that would save a hell of a lot of gas burn.

As it is, another two coal mines are due to close early next year in Yorkshire and we become even more reliant on imports for our energy.

Seems simple to me, but then I bet the figures don't stack up (well not yet anyway)