[Monkeyclogs]

If e.on next supply electricity from 100% renewable sources why has the increase in global oil and gas costs affected the price of electricity?

[meldrewreborn]

@Monkeyclogs

The energy market as a whole is linked to global prices. Eon next pump electricity into the grid as a GENERATOR. its then mixed with electricity from all the other generators. As a SUPPLIER Eon Next buy electricity from the wholesale market for its customers.

The price is largely driven by the daytime cost of supplying electricity which relies on electricity from gas generators amongst others. The purchase of gas derived energy is the most expensive and is bought only after all other supplies have been taken up. But the other suppliers price their offerings just below the likely electricity from gas price because they know it will be needed and this delivers the generators the highest returns.

Eon next wears two hats in this game as generator and supplier through different legal structures. The generating side is probably making excess profits on its renewable energy generation, while its supply arm is probably making (smaller) losses on its activities because the price caps lag behind the increases in the wholesale markets.

The system is broken and we're paying for it.

[Bennie_R97]

Thank you to @meldrewreborn for your response. What do you think this can be improved? Let's have a conversation about this.
@Monkeyclogs what do you think? :)

[meldrewreborn]

@Bennie_EONNext

Personally i would nationalise all of the electricity generators if their energy was being sold to the market at more than 10% above cost. Can you arrange that?

Then those nationalised companies would bring the market price of electricity down.

Gas though is a different matter. But the Government could buy Gas on the international market and pump it into the UK distribution system so at least we will have gas available this winter to keep warm. Whether the Government could force the generators that use gas as a fuel to moderate their prices I'm not sure - but it goes against political instincts and these it seems come higher up than protecting citizens from sky high prices.

But in reality @Bennie_EONNext there's nothing you or I can do to fix things - its above our pay grade.

[Andy65]

As a nation I would have thought that a simple short term solution would be to crank coal generated electricity back up and drop down gas. Before anyone gets excited about emissions etc, just controlling emissions isn't the answer and I doubt it ever will be.

[Bennie_R97]

@meldrewreborn Thank you for sharing your opinion. I totally understand where you come from and as you said, I probably won't be able to change that, but this is the kind of place where sharing ideas and opinions is welcome so thank you so much for that 😃

[meldrewreborn]

@joonsmith

The vast majority of companies exist to make profits, it’s how the capitalist system works. In some situations companies can make excess profits and sometimes action can be taken against them
but not always. Would it help UK PLC if taxation drove BP to another country for tax purposes?

[meldrewreborn]

Originally Posted by MAW

Would they like to make these "profits" without vast tax payer subsidy then? Or is that a bit too capitalist?

would you care to be specific? Which companies get the subsidies?

[meldrewreborn]

Originally Posted by MAW

what is happening now is the direct result of allowing an ill educated, school drop out dictate energy security policy. As I look at my horrific energy bills, I look back on how for years all these so-called adults and experts just sat there and nauseatingly hung off her every word. Now what do we have? Massive energy insecurity. Highly costly, ecologically catastrophic wind and solar power infrastrcuture which is "renewable" only at the point of generation, the fact that we have to strip mine the planet of its rare metals and use vast energy consuming processes to build windmills and solar panels which require gallons of toxic oils and chemicals to even exist seems - amazingly - beyond the wit and/or comprehension of most. Its a new religion, but the Emperor has no clothes. It seems those in charge forcing ESG policies upon us are intent on bankrupting us all before they will say "oh, sorry, we got that wrong". When Western Europe ends up looking like Sri Lanka did recently, with the economy collapsing and starving people chasing their leaders as they dashed for a battleship to get out of the country, it will be too late... but Sri Lanka had the best national ESG score in the world for a time. Bet that makes them feel great.

I think our approach is wrong in a number of aspects. But our current energy costs are down to Putin and Russia, not net zero policies.

[meldrewreborn]

@MAW

you need to look at the history of energy prices over last 10 years. Effectively prices in cash terms were flat for many years prior to the Russian invasion. All the points you make also applied over last 10 years, but in last year the factor has been Putin. Go figure.