| Ofgem protecting energy companies profits on 13:57 - Feb 6 with 911 views | Basuco |
Thanks, It all makes sense now. Sadly I should have guessed or known that. |  | |  |
| Ofgem protecting energy companies profits on 14:27 - Feb 6 with 866 views | Steve_M |
What do you think should happen to consumer prices if wholesale prices rise dramatically after March? (say Russia cuts off LNG to Europe or attacks somewhere outside of Ukraine then it's possible). Do you want the price cap to end in that case?
The argument the article makes - whether the author realises it or not - seems to be that consumers should be exposed to the wholesale price - to get the benefit of any falls below the cap but not exposure to the costs. That's not sustainable for any energy company.
That the market in the UK needs further reform is beyond doubt though, Ofgem's adherence to textbook economic theory remains a massive failing, but not sure they could do much else here. |  |
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| Ofgem protecting energy companies profits on 16:01 - Feb 6 with 796 views | DJR |
| Ofgem protecting energy companies profits on 14:27 - Feb 6 by Steve_M |
What do you think should happen to consumer prices if wholesale prices rise dramatically after March? (say Russia cuts off LNG to Europe or attacks somewhere outside of Ukraine then it's possible). Do you want the price cap to end in that case?
The argument the article makes - whether the author realises it or not - seems to be that consumers should be exposed to the wholesale price - to get the benefit of any falls below the cap but not exposure to the costs. That's not sustainable for any energy company.
That the market in the UK needs further reform is beyond doubt though, Ofgem's adherence to textbook economic theory remains a massive failing, but not sure they could do much else here. |
What's particularly galling is that our bills are inflated to cover the cost of the numerous failed energy companies, who didn't hedge and whose only real interest was making a quick buck.
I think it really goes to show that all of these "markets", whether in energy, rail or elsewhere, are really just an artificial con. |  | | |
| Ofgem protecting energy companies profits on 16:21 - Feb 6 with 723 views | Steve_M |
| Ofgem protecting energy companies profits on 16:01 - Feb 6 by DJR |
What's particularly galling is that our bills are inflated to cover the cost of the numerous failed energy companies, who didn't hedge and whose only real interest was making a quick buck.
I think it really goes to show that all of these "markets", whether in energy, rail or elsewhere, are really just an artificial con. |
That goes back to Ofgem's desperate desire to demonstrate competition which is considerably easier in a stable price environment than the rather more volatile one which developed in the second half of 2021 (initially due to Chinese gas demand).
I'm not totally sure that the energy market is a failure in the same way that the rail and water ones obviously are. The old CEGB and centralised planning wasn't flexible enough for the increased use of renewable generation and tended to overman power stations enormously but the Ofgem approach goes too far the other way, hence the impossibility of building any thermal power stations other than gas ones without direct government support over the last 20 years. | |
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| Ofgem protecting energy companies profits on 17:51 - Feb 6 with 643 views | DJR |
| Ofgem protecting energy companies profits on 16:21 - Feb 6 by Steve_M |
That goes back to Ofgem's desperate desire to demonstrate competition which is considerably easier in a stable price environment than the rather more volatile one which developed in the second half of 2021 (initially due to Chinese gas demand).
I'm not totally sure that the energy market is a failure in the same way that the rail and water ones obviously are. The old CEGB and centralised planning wasn't flexible enough for the increased use of renewable generation and tended to overman power stations enormously but the Ofgem approach goes too far the other way, hence the impossibility of building any thermal power stations other than gas ones without direct government support over the last 20 years. |
I certainly agree with your first paragraph.
As regards your second paragraph, you may have more knowledge of the energy market now and then than me, but given my father worked for Seeboard, London Electricity and Eastern Electricity over a period of 30 years, I still have a soft spot for how things were run then, when the public good was the guiding principle.
After all, it mustn't be forgot that nationalisation, with its centralised planning and expertise, made the UK the first country in the world to have nuclear power, in contrast to the slightly murky way nuclear power plants are built now.
I also sense that privatisation has meant the government has had less strategic control over an important sector. [Post edited 6 Feb 2023 17:53]
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