Peoples Energy: any experiences and/or knowledge of this supplier please?

[Cudzoziemiec]

Yes but as Hubner says it still raises the effective price per unit for those who use few units.

[hubner]

The price cap might include the standing charge now, but it wasn't in 2017.

[felstedrider]

The price cap might include the standing charge now, but it wasn't in 2017.

Your challenge was that suppliers are using the standing charge to get round the price cap.  This is not true.

[Quisling]

Except a 3 monthly review of the cap screws over people on fixed incomes more as they have more uncertainty and no opportunity for that to feed into things like benefit allowances or minimum wage or other government assistance...

However, it screws over the licensed energy suppliers less. Bearing in mind 29 of them have gone bust and none of the others are prepared to take on new customers until the cap rises the competitive market is essentially broken unless suppliers can limit exposure.

I can't think of other markets where this sort of daft cap applies.  The government don't cap the cost of a weekly shop-up to less than what it costs the supermarket chains to buy it for example.  The problem then is one of poverty more generally and the inability of households to cope with sharp changes in any costs of living.

Fuel poverty, or "stress" is a multi-million household problem in the UK which (a) supports the case for Insulate Britain blocking motorways and (b) is a huge indictment on the government's claims to be "levelling-up".  See also food banks etc.

[felstedrider]

What Quisling said….

Here’s some backing info.  Bulb, Octopus, Ovo, the councils, etc never turned a profit even before the madness at the end of last year.  SSE and npower sold their residential supply businesses.  Centrica’s share price collapsed.

There is no evidence to support the assertion that suppliers are ripping customers off.

[Frank9755]

I don't know much about this market so am always pleased to get the inside story from Felstedrider, who is an expert in it. 

However I do know a fair bit about private equity firms and how they extract value from firms while minimising tax liabilities, using debt, transfer pricing, management fees and other strategies. So lack of profits doesn't necessarily disprove 'ripping off', and is potentially a sign to dig deeper.  I haven't got time for that but a couple of minutes research reminded me that the talk of 'ripping off' was primarily directed at the big 6 and, in particular, the tariffs they charged consumers who didn't bother to shop around and switch. And I didn't find anything which suggested to me that the guys who went bust were 'ripping off'. 

I found this article quite interesting, which suggested that the Big 6 might have been right after all and the government's strategy now might be to push operators back in that direction - probably with better terms for non-switchers:
https://news.sky.com/story/keep-your-fingers-crossed-strategy-leaving-smaller-energy-suppliers-out-in-the-cold-12412934


This is where the ripping off theme seems to have started, in parliament:
https://www.theguardian.com/money/2017/mar/12/millions-overpaying-energy-bills-admits-ministry-big-six

If I now had to give a view, based purely on what I've learned from FR and my two minutes on google, it would be that, rather than having been a rip-off, the market has suffered from political interference to coerce, encourage and enable operators with shaky business models to offer artificially low prices which proved unsustainable.

[Cudzoziemiec]

Except a 3 monthly review of the cap screws over people on fixed incomes more as they have more uncertainty and no opportunity for that to feed into things like benefit allowances or minimum wage or other government assistance...

However, it screws over the licensed energy suppliers less. Bearing in mind 29 of them have gone bust and none of the others are prepared to take on new customers until the cap rises the competitive market is essentially broken unless suppliers can limit exposure.

I can't think of other markets where this sort of daft cap applies.  The government don't cap the cost of a weekly shop-up to less than what it costs the supermarket chains to buy it for example.  The problem then is one of poverty more generally and the inability of households to cope with sharp changes in any costs of living.

Fuel poverty, or "stress" is a multi-million household problem in the UK which (a) supports the case for Insulate Britain blocking motorways and (b) is a huge indictment on the government's claims to be "levelling-up".  See also food banks etc.

Very much so. From the consumer's point of view, there is poverty; specifying it as "fuel poverty" or "food poverty" or "rent poverty" might be semi-useful to identify large or rapidly-rising costs, but the basic problem is just poverty. Mr Micawber's rule applies, as it had done for a few thousand years before Dickens.

[ian]

...
If I now had to give a view, based purely on what I've learned from FR and my two minutes on google, it would be that, rather than having been a rip-off, the market has suffered from political interference to coerce, encourage and enable operators with shaky business models to offer artificially low prices which proved unsustainable.

I think I wrote similar some time back. Hell of way to run an energy market, I think. As ever, this mess should be on the government's doormat.

I still think their proposal to 'help' people is at best quarterwitted, at worse a dubious bung to keep the remaining suppliers in the market.

[Polar Bear]

It is of course inevitable that households in fuel poverty are also households in food poverty.

The approach to the fuel price crisis reflects the confusion amongst the believers of how a free market model can fail so badly.  If gas and electricity had remained nationalised then the cost of these essentials need not change because the balance sheet would simply be a treasury matter funded from taxation and borrowing.  Adding in layers of middlemen resulting in expectations of profits and excess wage structures for faux executives simply jacks up the price anyway.

For food poverty we have food banks.  For poverty wages we have benefits.  For fuel poverty we have loans.  Three contrasting systems that only one has a hope of working well (and does) and that's food banks.  Ironic then that the government has no grubbies in the pie there then.  No?

[CrazyEnglishTriathlete]

I don’t understand. The oil price has been up and down, but I recently bought a tank full of heating oil for a lower price than about 9 months ago.
We are told that we have increased our use of renewable electricity sources. Have wind and sun gone up in price!
Meanwhile the CEO of EON takes home £1.1 million.

Oil and gas prices are not really correlated.   Global gas prices have been at all time highs.

Despite the build out of renewables we still generate circa 50% of power from gas.   Gas goes up, power goes up.

The UK's low-carbon energy supplies are dominated by wind power, which when its windy can generate up to 20GW, about 50% of the average current electricity demand on a winter's day.  When its mostly calm, this drops to 2GW.  The difference is mostly made up by burning gas.  Many European countries have followed a similar model.  The second half of 2021 was exceptional for low winds, which meant unprecedented demand for gas.  Hence the price went sky high. 

Our other big investment in renewable energy is solar, which next summer could generate 10GW or 30% of our average current summer electricity demand.  Even in winter it can generate 2- 3GW when there's a reasonable amount of daylight, but will never dent into the gap above.

There are three other low carbon ways to generate electricity which aren't subject to the vagaries of the weather.  1) Hydro - but our geography isn't conducive to that - it helps if you have lots of mountains.  If you flooded most of the valleys in the Scottish Highlands you'd meet some of our needs but not all.  2) Nuclear - there are lot of people who have objections and it would take 10 years for any new projects to come on line.  3) Tidal - we've  got the best geography in the world for that, but there are a lot of environmental objections to walling off large parts of the Bristol Channel, and the Thames and installing huge turbines.  However, without any of these three we will be at the mercy of fluctuating energy prices.

There isn't a single option that anyone will vote for.  And if we do nothing voters will complain to the government about its failure of environmental policy.  Much as I have little love for the current government, it, and any of its successors will have its backs to the wall on this topic.

Sorry, I have a soap box on this one.  I'll get off it now.

[LittleWheelsandBig]

Doing some big tidal projects is the obvious answer but the government that forces them through will get voted out. Currently, the UK government is more interested in lining their pockets than securing the country’s long-term power supply.

[FifeingEejit]

Given recent lack of rainfall in certain areas, converting some of the scottish hydro schemes to pumped storage may be a good thing, only problem is where to get the water from...

[Frank9755]

I thought, but I may be wrong, that the Swansea bay tidal project was popular locally, no?

[felstedrider]

I thought, but I may be wrong, that the Swansea bay tidal project was popular locally, no?

http://www.tidallagoonpower.com/projects/swansea-bay/

I first met the developer behind this 10 years ago.   I think the problem is that tidal projects are just so expensive.   The subsidy regime (CfD now the RO is closed) favours cheaper technologies like offshore wind.

The phase 3 offshore wind projects are huge but won't start to deliver until the back end of the decade.

Solar is profitable at current market prices, unsubsidised, as the cost of the panels has come down and the yield is so much better with modern tech.   But the panels are difficult to get hold of (production issues in China) and the shipping costs have increased significantly.

[LittleWheelsandBig]

Swansea Bay was pretty popular (boating, fishing, remediation of degraded brownfield waterfront, etc.) but the government pulled the pin because of cost, despite it being a pilot project with costs expected to fall for subsequent projects. Part of the project cost was reopening rock quarries in the southwest and building loading facilities to bring the rock armour around by water. Sizeable up-front cost but fairly low operating cost. Alternative rock would have come from Norway (big rock pieces aren't currently available in the UK).

[rafletcher]

Given recent lack of rainfall in certain areas, converting some of the scottish hydro schemes to pumped storage may be a good thing, only problem is where to get the water from...

There's alos the transmission issues - it isn't practical (or, if vague memory serves me, possible) to send power generatied in Scotland to London to be used.

And there are restrictions on supply length dependant on the type of load needing it - again, beyond mytechnical ken, but others I'm sure can explain it.  For some instances - instantaneous demand from air conditioners for example, only locally (FCVO of local) gernerated power will suffice.

[Feanor]

There's a large upgrade of the HV transmission network in Scotland ongoing to address this.
Both the East and West coast main transmission lines are being upgraded from 275 to 400 kV.
Several HVDC interconnectors are being put in place, and lots of new and upgraded substations for renewables tie-in.

[felstedrider]

There's also the transmission issues - it isn't practical (or, if vague memory serves me, possible) to send power generated in Scotland to London to be used.

There are times when Grid need to bid off Scottish generation.   Not because the UK is long overall but because the transmission constraints mean it can't be moved over the border.   As Feanor points out there are physical reinforcements taking place that will avoid this issue in the future.   There is a lot of offshore wind that will hook onto the Scottish Grid.

[Cudzoziemiec]

Swansea Bay was pretty popular (boating, fishing, remediation of degraded brownfield waterfront, etc.) but the government pulled the pin on cost reasons, despite it being a pilot project with costs expected to fall for subsequent projects. Part of the project cost was reopening rock quarries in the southwest and building loading facilities to bring the rock armour around by water. Sizeable up-front cost but fairly low operating cost. Alternative rock would have come from Norway (big rock pieces aren't currently available in the UK).

In contrast, a quarry in South Glos was reopened to provide rock for Hinkley Point. But I don't know the relative quantities or sizes involved.

[LittleWheelsandBig]

Swansea required rock pieces weighing several tonnes each for both sides (different sizes each side) of a several kilometres long bund.

[rafletcher]

There's also the transmission issues - it isn't practical (or, if vague memory serves me, possible) to send power generated in Scotland to London to be used.

There are times when Grid need to bid off Scottish generation.   Not because the UK is long overall but because the transmission constraints mean it can't be moved over the border.   As Feanor points out there are physical reinforcements taking place that will avoid this issue in the future.   There is a lot of offshore wind that will hook onto the Scottish Grid.

I meant to say "not possible for technical reasons", not because it was along way away. 

[mrcharly-YHT]

Given recent lack of rainfall in certain areas, converting some of the scottish hydro schemes to pumped storage may be a good thing, only problem is where to get the water from...

There's alos the transmission issues - it isn't practical (or, if vague memory serves me, possible) to send power generatied in Scotland to London to be used.

And there are restrictions on supply length dependant on the type of load needing it - again, beyond mytechnical ken, but others I'm sure can explain it.  For some instances - instantaneous demand from air conditioners for example, only locally (FCVO of local) gernerated power will suffice.

The main problem is that HVAC lines disrupt the migratory paths of Haggis.

[andyoxon]

We're with Octopus now, on flexible rates. 

In general, anyone know the reason why are the daily standing charges for elect are going up so much?  Approaching 190% rise...


                               Oct-21    Apr-22   % inc
Elect  Price per KWH   0.2049   0.2834   138.3
     Daily charge           0.2411   0.4534   188.1
Gas     Price per KWH   0.0413   0.0737   178.5
     Daily charge           0.2611   0.2722   104.3

[Kim]

Because it makes the unit rate cheaper?

[Polar Bear]

And it rakes more money from low use customers.   It seems a truly cynical and awful policy given the awareness of fuel poverty.