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29 minutes ago, Gladys said:

Wasn't the £26m a loan to MUA so they don't have to increase the tariff over winter?  Presumably, that will have to be paid back and there is only one way to do that and it is not connected to gas prices. 

And many are the loans connected to the history of IoM energy supplies....

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40 minutes ago, Gladys said:

Wasn't the £26m a loan to MUA so they don't have to increase the tariff over winter?  Presumably, that will have to be paid back and there is only one way to do that and it is not connected to gas prices. 

It's repayable over 20 years. 

 

I think at the time I read it would add £17 a year to each household bill. 

(But if you run £26m over 20 years and £17 a year, that gives something like 76,000... I don't think we have that many households do we?).

 

ETA:  

The Minster later predicted that the loan taken out would "add £17 a year to the average household bill over the next two decades".

https://www.itv.com/news/granada/2022-09-23/isle-of-man-government-approves-cost-of-living-winter-support

 

Edited by 0bserver
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25 minutes ago, 0bserver said:

I think at the time I read it would add £17 a year to each household bill. 

(But if you run £26m over 20 years and £17 a year, that gives something like 76,000...

I think "rule of thumb" is about 36,000 here, isn't it...?

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10 hours ago, Gladys said:

Wasn't the £26m a loan to MUA so they don't have to increase the tariff over winter?  Presumably, that will have to be paid back and there is only one way to do that and it is not connected to gas prices. 

As I see it it's not connected to gas prices. Gas prices have stabilised so maybe the MUA will pay it straight back without spending it.😅

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1 minute ago, Happier diner said:

As I see it it's not connected to gas prices. Gas prices have stabilised so maybe the MUA will pay it straight back without spending it.😅

The gas for the winter period was pre-purchased (hedged or whatever term they're using) so current prices won't offer any benefit.

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4 minutes ago, 0bserver said:

The gas for the winter period was pre-purchased (hedged or whatever term they're using) so current prices won't offer any benefit.

They do buy some forward as do MUA  & will be still doing so , they also both buy at spot. So current low forward & spot prices will of course help

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1 hour ago, Banker said:

They do buy some forward as do MUA  & will be still doing so , they also both buy at spot. So current low forward & spot prices will of course help

I thought MG/IEG had a problem with hedging/forward purchasing. They buy via MUA and MUA was refusing to place hedges or forward purchases due to concerns over MG/IEG finances.

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13 minutes ago, John Wright said:

I thought MG/IEG had a problem with hedging/forward purchasing. They buy via MUA and MUA was refusing to place hedges or forward purchases due to concerns over MG/IEG finances.

I was mainly referring to MUA & electricity prices based on gas prices but I also thought issues has been resolved & some forwards were being done for MG

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1 hour ago, 0bserver said:

The gas for the winter period was pre-purchased (hedged or whatever term they're using) so current prices won't offer any benefit.

They only hedge a proportion so it will help. The spot price is low. You can always buy at a spot price. 

The uncertainty will be that no one will offer long term low rates. 

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45 minutes ago, Banker said:

I was mainly referring to MUA & electricity prices based on gas prices but I also thought issues has been resolved & some forwards were being done for MG

That’s not how your sentence is constructed and reads. It’s specific to MG ( but says MUA do the same )

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1 hour ago, John Wright said:

I thought MG/IEG had a problem with hedging/forward purchasing. They buy via MUA and MUA was refusing to place hedges or forward purchases due to concerns over MG/IEG finances.

Sort of. But i believe the issue was that MG hadnt paid for gas it had used and owed the MUA money. Because of that MUA were refusing to buy MG any more gas. 

That was my understanding 

Edited by Happier diner
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