[BBC News] Gas customers face higher bills

[manshimajin]

The company blamed the rising cost of wholesale gas, record oil prices and the global credit crunch for the rise

I can understand rise in costs for wholesale gas and oil but what exactly has the global credit crunch to do with it?

Due to the instability in the credit market, investors are moving into commodities, which are seen as 'safe havens' during times of economic uncertainty. This increases demand for such goods, such as gas, oil and wheat, therefore driving up the price.

 

It's a shame that institutions cannot explain the situation as well as this - I guess that is why they employ PR officers and spokespersons.

[Slim]

they are being paid more for the electricity than the utility can sell it for - crazy -

 

Only when you add the RO payment, which is an incentive to up the amount of renewables. Pretty sensible to incentivise isn't it, how is that crazy?

 

notice that they don't actually use the electricity they generate thus the utility still needs to provide plant to cover the peak demands once the sun does not shine - as the PV cannot guarantee a fixed supply the utility must still have generation capacity ready to switch in at short notice.

 

Power is still required in the daytime, even if he's not personally using it. That chap goes to work and sits in an airconditioned office that his house might be helping to power, what's up with that? Yes storage is a problem, which is why you need a range of renewables, plus the backup of something like nuclear, but this doesn't happen overnight, and certainly doesn't happen with bleating neighsayers like you around.

 

 

Any realistic local generation scheme needs eneergy storage and this problem has as yet no cheap solution - also I'm amazed at the 0.5% degradation rate - my own estimate is probably nearer 10x this figure + other failure modes would I suggest give an estimated life time of about 20 years thus on present prices they can never be cost effective but are a 'religious' statement

 

Your estimates disagree's with published research, and I know which I believe. The waranteed life time of modern panels is 25-30 years. There's certainly big gains to be made with photovoltaics, but they're hardly as useless as you make out. A far bigger problem is the environmental cost of their manufacture, transportation and installation, which is improving with thinner lighter panels but is still a big issue.

[Frances]

there is more than the panels - the power electronics probably have a shorter life - my 20 years replacement was a system cost - ok my degradation figures were based on my own knowledge of satellites which are in a much worse radiation environment but at 0.5% degradation this means the power supplied halves every 140 years - I just don't believe a packaged system meets this - the internal PV cell might suffer this degradation due to random bombardment by cosmic rays wrecking the structure, but the packageing will age much faster

[Frances]

re the suggestion that the mediaeval sin of engrossment is to blame for rising commodity prices - I suspect that Anatole Kaletsky in the Times has a better theory - http://business.timesonline.co.uk/tol/busi...icle3784907.ece

[triskelion]

He doesn't really have a theory; just an idea. His actual point is that no one really knows.

[WTF]

Bizarre. So, by your logic, it would be most economical for us all to drive 4-litre BMWs and leave our windows open during the winter. Transport fuel costs are higher than ever, yet we are also using more than ever. So you are talking nonsense.

 

no, what i'm saying is that the infrastructure needs paying for regardless of how much product is sold. therefore the mark up per unit of product has to be more if less product is sold to balance the books. if the mea didn't sell a single unit of electricity, there would still be the workers wages to pay and the repayments on the new powerstation. thats why we won't all get to opt out of buying their electricity by having our own wind turbines. if 20% of the population were able to get their electricity elsewhere it leaves the 80% to pay the mea's bills, so more cost to them. most of the cost of fuel at the pumps is duty. the duty goes to the government who need money to run the country. IF they are getting less money in from less fuel sold, then they need to increase revenue. the only way for that to happen is more taxes/duty. and the way this lot piss our money away on consultants wet dreams it's no wonder we pay over the odds for many things.

Whilst you are right to say infrastructure needs paying for regardless, I am far convinced by your subsequent arguments. Firstly, no business in its right mind is going to raise prices in response to a decline in its customer base. If people switching to self-generation, they would still, if they have any sense, remain connected to the grid and would likely still require MEA supply for, say, windless days. Clearly however, the MEA would still be selling fewer units to such people. The MEA still has alternatives to your 'charge more' strategy though. It still has the undersea cable through which it could sell electricity to the UK. Additionally, it may make sense for it to become a retailer of wind turbines, solar panels et al itself.

 

The duty at the pumps is about 50% of the price, which does indeed represent a substantial chunk of Government revenue. However, if this declines, it is equally true to say that people are paying less tax, unveiling the argument that any tax brought in to correct this shortfall would not truly constitute 'more.'

 

 

 

on the electric front, the mea may have the option to sell electricity to the uk grid, but the cost would not be anything like what they rip us off at. the national grid in the uk would produce it's own before it payed more for ours than it can produce it itself. we didn't need a 400 million power station that will be life expired in 15 - 20 years. all we needed at much less cost was 2 BIG cables from england/scotland and 2 more big cables from ireland. the power station site could have been a big sub station. we could then have had electricity at a little more than uk prices with the irish connection used in tandem. if for some reason one side failed to produce power we could draw from the other.

 

as to the petrol bit, i was not trying to say our tax bill would be more on an individual basis, just that there would be a higher percentage of duty on fuel. so even if you use less fuel you are still paying the tax that you were when you were using more fuel. in effect you are driving less and saving nothing of note in real terms,

 

on the not putting prices up to compensate for less profits, someone has already posted what the gas did years ago!!, ramsey bakery i think also put up prices due to more imported bread being sold. i'm sure i heard JD dribbling on on the radio before the prices went up and put competition as a main reason coupled with flour prices. we pay over the odds to keep people in jobs locally which may or may not be right. take farming, there must be 100 farmers on the island all trying to make a living from the available land, they get subsidised themselves so they can atleast live and tend the countryside. but there are many farms in the UK of similar size to the whole island where less than 10 people work the entire farm!!. 10 years ago you had ( probably still have ) farmers with 30 acres of land and 100 sheep expecting to make a living from it. good game,good game, but decades ago it would have been a viable farm/small holding. little farms just don't work anymore unless you have sheds full of chickens laying eggs. i can certainly understand why the farmers butts are puckering for when europe pulls the protected market and/or subsidy's in a few years..