Rising energy costs

[david@normanst]

So i used a business energy online calculator that gives a very rough idea of the amounts I will save on my gas bill after the government cap on the wholesale element part.. it works out at 7% reduction.. which frankly isnt going to be of much help on a bill that's increased by 300%. The calculator doesnt take into account climate levy or VAT. I think the government has kinda over hyped the help they are giving as something substantial and meaningful. in reality I can't see how those with even greater increases are going to see any differnece or improvement to their dire predicament. Most likely cost of stock will go up further because of the falling pound. Urghhh more turbulence.

That's the conclusion I came to with the electric cap. We've now agreed an electric bill at 72 pence a unit plus vat and we're still none the wiser as to the wholesale cost and therefore what we'll actually pay.

 

[BobzYourUncle]

That's the conclusion I came to with the electric cap. We've now agreed an electric bill at 72 pence a unit plus vat and we're still none the wiser as to the wholesale cost and therefore what we'll actually pay.

My approximate saving per month is £59.. ?

 

[SillyBill]

That's the conclusion I came to with the electric cap. We've now agreed an electric bill at 72 pence a unit plus vat and we're still none the wiser as to the wholesale cost and therefore what we'll actually pay.

How long have you fixed that for? And agree with your sentiments, very difficult to plan ahead at present.

Wild ride no doubt on wholesale gas prices and electricity through the winter and all next year. I personally am hoping (emphasis on hope) that Putin is running out of escalation tactics he can actually do without NATO getting involved...and prices will fall back consequently albeit I think we can conclude the prices of yesteryear are no realistic prospect for the next few years. Those days are sadly gone. Quite frankly 30p pkwh now looks like an absolute bargain. I think its positive that quoted prices have plateaued somewhat as a first sign of reprieve, I was concerned the whole economy would collapse at the rate it was going.

 

[david@normanst]

We've opted for 12 months at 72 pence but were also quoted 63 for 24 months

 

[DontAsk]

How long have you fixed that for? And agree with your sentiments, very difficult to plan ahead at present.

Wild ride no doubt on wholesale gas prices and electricity through the winter and all next year. I personally am hoping (emphasis on hope) that Putin is running out of escalation tactics he can actually do without NATO getting involved...and prices will fall back consequently albeit I think we can conclude the prices of yesteryear are no realistic prospect for the next few years. Those days are sadly gone. Quite frankly 30p pkwh now looks like an absolute bargain. I think its positive that quoted prices have plateaued somewhat as a first sign of reprieve, I was concerned the whole economy would collapse at the rate it was going.

No good prices dropping if the pipelines are foo-barred.

 

[SillyBill]

No good prices dropping if the pipelines are foo-barred.

NS1/NS2 weren't ever about nameplate capacity, they were a Russian design to cut Ukraine out the picture and their transit fees and snare Germany. Assuming no silly games there is more than enough capacity within existing pipelines to get the gas into Europe. Do note as well one of the NS2 lines (there are 2) wasn't taken out so that could be supplying a decent chunk of capacity, not that it will.

 

[WaveJumper]

Off the wires this morning -

"Oil prices surged on reports that OPEC was considering a cut to output this week that might be as big as one million barrels per day, once again raising the spectre of a sustained rise in energy costs and an associated impact on inflation, just as oil had fallen to its lowest level since the beginning of the year"

Here we go again

 

[Waddy]

Has anybody actually been told by their energy company how much they're paying now?

 

[Picture Bute]

Has anybody actually been told by their energy company how much they're paying now?

For business energy, we'll all be paying our contracted rates until these contracts are up.

 

[PaulaS]

We've received our electricity bill now for October with a "Government discount" of 10.5p/kWh. Has anyone else had theirs? I was under the impression that this hadn't been finalised yet.

 

[BobzYourUncle]

We've received our electricity bill now for October with a "Government discount" of 10.5p/kWh. Has anyone else had theirs? I was under the impression that this hadn't been finalised yet.

We've not got electricity bill yet. But our gas has been discounted by 2.7p kwh. So now we are paying double rather than triple what we were when we was on a fixed. Its definatley helped us. But we still had to cut staff, cut hours of opening and shut a extra day. We are now literally only open 22 hrs a week. But we still here surviving that's the main thing . Riding this thing out.

 

[ArtieFufkin]

Our contract ends March and brokers are contacting me to say to fix now as prices can only increase but I am unsure. I have a feeling, reading between the lines of politicians, that energy prices are going to improve next year. Any thoughts?

 

[fisicx]

I have a feeling, reading between the lines of politicians, that energy prices are going to improve next year. Any thoughts?

Very unlikely.

 

[SillyBill]

Our contract ends March and brokers are contacting me to say to fix now as prices can only increase but I am unsure. I have a feeling, reading between the lines of politicians, that energy prices are going to improve next year. Any thoughts?

Brokers know as much about the future market in energy as money managers know about the future price of a stock a year from now. That is to say, not much. Their use is penetrating the bureaucracy of large energy companies and being an easier point of contact for SMEs to sort things out. Nothing more, beyond that, you make the decision and take a risk, as per any other business decision. One thing we do know is energy prices aren't going back to where they were but 18-24 months from now hopefully there may be some relief from the nosebleed levels we see now. My estimation FWIW is we've peaked but how long it takes to come down, no idea.

I had one broker (with tactics akin to selling second hand cars) sending me charts/links almost daily , one notable one was extrapolating out the wholesale costs, this was around the end of August, ridiculous... effectively re-hashing Cornwall Insights level nonsense (the media's favourtite go-to doomsayer), and sure enough they collapsed immediately after. As I told him it likely would as at some point the price itself has to dampnen the market. .Aware this doesn't feed into retail prices as yet mind (for a myriad of reasons) but goes to show how know-nothing a lot of them are. A recent graduate broker on commission doesn't care half as much about my energy bill as I do. I had a good broker who retired, old bloke who was nice to chat to, shame.

 

[Businessowner123]

@NickGrogan
historically has business energy been cheaper or more expensive than domestic , per kwh

 

[NickGrogan]

@NickGrogan
historically has business energy been cheaper or more expensive than domestic , per kwh

Yes, a lot of people switched to commercial supplies for their homes as it was cheaper, now they are all trying to switch back to domestic to take advantage of the price cap.

 

[IanSuth]

WARNING RE BULB

I stopped having an account with them in oct2021 and they sent us a settlement amount as we were in credit.

Today i opened a letter address to my house but with a different name i didnt recognise (and i have lived here over 20 years), it was a final warning before legal action about a £3202.76 overdue debt for a different address stating payment needed to be made by Tuesday or legal action would be started and a request to call immediately to settle at least 70%

Because i am a persistent git i kept ringing trying different approaches to get past the gatekeeper call centre people who just wanted to promise a call back within 3 working days, eventually i got an intelligent human.

Basically they have had a computer system glitch and the letters have been sent in error attaching debts to other accounts - I have it in writing from their data protection team that no debt is registered against my name or address now but it would have scared to death a vulnerable person who might have tried to pay

 

[Teacher42]

I HEAR THERE'S A LOOPHOLE TO STOP NEW CONTRACT BEFORE IT STARTS?

My business gas and electric contracts are due for renewal in April. I am currently paying 3.5kWh gas and 14.5kWh electric.

Last month I made the decision to sign into contracts as all indications were that prices were not going to improve and may indeed have increased even more if Europe had a cold winter. So I signed into 17.5kWh gas and 48.5kWh electric, both for 2 years starting April. Now it transpires better deals are available.

I am fully aware that I made a business decision which seemed correct at the time and I am contracted into these prices. A broker is handling my transfer of electric from SmartEnergy to BG Lite and he has my LoA to act on my behalf. We are transferring gas from ClearBusiness to BGLite but ClearBusiness seemingly do not deal with brokers and I am handling the transfer myself. I have sent a termination of contract notice to them.

But I hear that a situation can arise when a new supplier is blocked for some reason from taking over the old contract and if this happens, the new supplier has 3 tries and if it still doesn’t go through, then the new contract is invalid.

Can I use this ‘loophole’ to my advantage? Can I somehow stop the transfer to my new contracts, thereby allowing me to sign into a new cheaper contract?

 

[OMGVape]

Could it be that this new contract doesn’t actually become binding until 1st April?

 

[PaulaS]

What sorts of prices are people getting for electricity at the moment? Ours is at 37p until September, I'm trying to get a handle on what it could be after that.

 

[SillyBill]

I'd be interested to know what other business owners are seeing in terms of standing charges.

We have gone from standing charges in Feb 23 of 216.6p per day on our last contract (& I assume this was higher than others as we have a half hourly meter as we're a bigger user of energy) to 2571.72p per day in our new contract which kicked in 1st March 23. So we have gone from paying aobut £67 a month in standing charges to now almost £800 a month (£782/month). But given we are a one year tariff I have just had my first quotes in for the new year (1st March 24) with standing charges now all over 5000p/day, lowest being 5131p/day! So we will be paying £1500-1600 a month in standing charges (over £50/day). A 20 fold increase in 13 months...how is this justifable given this is supposed to reflect grid costs? I have asked why we can't just get this ridculous number brought back down to a sensible level and the supplier put it on the p/kwh rate if they want more money out of us. Seems like a total con. Are they just trying to hide their profit in the standing charge now given attracts less scrutiny? We use over 250,000 kwh of energy per year as reference. Given we are only being quoted marginally less than smaller businesses for our per kwh rate when you factor in the standing charge we are paying about 17% more than a tiny business who uses a fraction of our energy. All our borker says is this is at the discretion of the suppliers and a lot are doing this on half hourly meters now, so x22 increase in standard charges is somehow justified...they're happy as they still get their commission.

 

[NickGrogan]

Everyone is in the same boat, unfortunately. It's not the suppliers that are the issue this time but the distribution companies. Some suppliers have started separating out the costs, one quote we did last week had the standing charge split out - 75p per day for the supplier, £49.98 for transmission and distribution costs. I think they're showing it separate to stop accusations of profiteering.

Ofgem regulates the charges that the transmission and distribution companies make, so the suppliers have no control over them.

Ofgem has also changed the way that these charges are calculated to make it "Fairier" - their words not mine. This is part of the TCR review which they originally claimed would be cost neutral - that claim seems to have disappeared.

Finally, you've got the mutualisation of the losses caused by failed suppliers, mainly caused by Ofgem's failure to regulate the market.

 

[Picture Bute]

Everyone is in the same boat, unfortunately. It's not the suppliers that are the issue this time but the distribution companies. Some suppliers have started separating out the costs, one quote we did last week had the standing charge split out - 75p per day for the supplier, £49.98 for transmission and distribution costs. I think they're showing it separate to stop accusations of profiteering.

Ofgem regulates the charges that the transmission and distribution companies make, so the suppliers have no control over them.

Ofgem has also changed the way that these charges are calculated to make it "Fairier" - their words not mine. This is part of the TCR review which they originally claimed would be cost neutral - that claim seems to have disappeared.

Finally, you've got the mutualisation of the losses caused by failed suppliers, mainly caused by Ofgem's failure to regulate the market.

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