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Energy Bills Rising As They Fall (Or Something Like That!)

October 22, 2017

By Paul Homewood

 

 

image

https://www.thesun.co.uk/news/3512895/theresa-may-energy-cap-promise/

 

 

For the past year, Theresa May has been very vocal about rising energy bills, which she blames on the wicked energy companies.

She could not have been more explicit in an comment piece she wrote for the Sun in May:

Like millions of working families, I am fed up with rip-off energy prices.

Gas and electricity bills only ever seem to go in one direction, eating up more and more of your monthly pay packet.

https://www.thesun.co.uk/news/3512895/theresa-may-energy-cap-promise/

 

Which is all very strange, because earlier this month she was comprehensively rebutted by her own Energy Minister, Claire Perry, who told delegates at the Tory Conference:

It’s something that we don’t seem to talk about. But for household consumers energy bills have actually gone down, mostly because we are more energy efficient and use more efficient appliances.

http://www.telegraph.co.uk/business/2017/10/02/green-measures-cut-power-bills-despite-former-pm-camerons-misgivings/

 

The Telegraph report added:

But official figures show that the average price of a dual fuel energy bill paid via direct debit has nonetheless fallen from over £1,000 a year in late 2013 to less around £865 a year today.

 

 

Maybe Mrs May and her minister might like to put their heads together and get their story right!

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30 Comments
  1. A C Osborn permalink
    October 22, 2017 10:57 am

    Unfortunately the official figures do not actually show why the bills have gone down.
    They have surmised that it is due to efficiency, whereas it could that the poorer people are just turning off their heating and going cold because they cannot afford to pay.
    I have detected no decrease in my energy bills.

  2. David permalink
    October 22, 2017 11:10 am

    The government should deal with the water companies. They are a REAL monopoly ripping us off.

  3. Stonyground permalink
    October 22, 2017 11:22 am

    It is a stupid lefty idea that you can just pass a government decree and make something cost less than it costs. Either someone else will have to pay or energy companies will be forced to operate at a loss. We all know the real reason why energy is so expensive and what needs to be done to bring the cost down. It is another way that leaving the EU could be turned to our advantage, repeal the climate change act and leave the Europeans to pointlessly burden their industry and citizens with expensive green crap.

    • Up2snuff permalink
      October 22, 2017 2:23 pm

      I agree. The Government should deal with the Standing Charge and the VAT charge on energy. The former mitigates against the small consumer and the energy efficient household. The latter will become unnecessary when we leave the EU as far as EU regulation is concerned although the Treasury will miss the income.

      • Gerry, England permalink
        October 23, 2017 12:51 pm

        I suspect – and I think it has already been hinted at if not said – this would be a sticking point to any future trade deal with the EU. Trade deals contain about 1% on tariffs and the rest ranges to all sorts of areas such as workers’ rights, environmental protection, etc. I think it has already been said that a dim view would be taken of a race to the bottom regarding regulations, tax rates, environmental protection and the government I believe said that it wouldn’t go down that route. But since the Tories are leading us to the sunlit uplands of a ‘no deal’ Brexit, it wouldn’t matter.

  4. spetzer86 permalink
    October 22, 2017 11:46 am

    Even if “green” appliances reduced energy consumption on a unit time basis, was the increased cost of these new devices due to their energy saving features or longer required operating time to perform their function figured into the monthly energy bill?

  5. Ian permalink
    October 22, 2017 12:46 pm

    Claire Perry says:

    “It’s something that we don’t seem to talk about. But for household consumers energy bills have actually gone down, mostly because we are more energy efficient and use more efficient appliances.”

    This is in line with a letter from her via my MP, which includes:

    “In relation to the cost of environmental and social obligations, Ofgem analysis of the financial reports from the six largest energy suppliers shows that these costs amounted to 8% of an average household dual fuel bill in 2016 (2% gas, 15% electricity) compared to 38% for wholesale energy costs (39% gas, 36% electricity). This excludes costs from the EU Emission Trading System and Carbon Price Support. The independent Committee on Climate Change (CCC) estimates, when including these costs, show that all energy and climate change policy accounted for around 12% (around £140) of an average dual fuel bill in 2016.

    “Even so, these costs are on average more than offset by savings from improvements to the energy efficiency of people’s homes. The CCC estimate that household energy efficiency improvement made since 2008 (both policy and non-policy driven) are delivering average bill savings of around £290 per year.”

    The only things affecting my electricity bills are a) weather, b) competitive pricing. I’ve asked my MP to ascertain the justification for that ludicrous claim.

    • Tim Hammond permalink
      October 22, 2017 1:49 pm

      Which is still an increase of £140 a year. I am happy to become more fuel-efficient – I’m pretty happy for everything to become more efficient since that is what drives increased wealth – so it is ridiculous to claim that somehow increasing cost is offset by that.

      My bill should be £140 lower because of increased efficiency. That’s the baseline.

      • NeilC permalink
        October 22, 2017 5:01 pm

        I would like electricity generation to become more efficient too. But the government won’t do that, will they?

    • Robert Jones permalink
      October 22, 2017 5:17 pm

      The CCC can hardly be described as ‘independent’ when it is stuffed to the rafters with unqualified and rapid eco-nuts.

      • Robert Jones permalink
        October 22, 2017 5:19 pm

        Apologies, that should have read ‘rabid’.

      • Sara Hall permalink
        October 22, 2017 6:08 pm

        Or ‘vapid’, maybe?

    • Gerry, England permalink
      October 23, 2017 1:02 pm

      ‘estimate’ So no factual data to back up this claim on efficiency savings?

      I would like to know where this great increase in efficiency comes from? The biggest saving I have made is having to turn off my pond pumps and filters due to fault. Quite a surprise as to how much consumption have reduced.

  6. October 22, 2017 1:08 pm

    Things like better insulation and more ‘efficient’ appliances, lights etc. could reduce bills, assuming the same level of usage. It depends how much the unit cost of power goes up in the same time frame, which obviously is where the rising cost of subsidies plays a big part.

    • MrGrimNasty permalink
      October 22, 2017 4:44 pm

      It’s not a cost saving though is it, if you’ve expended on new appliances prematurely or really effective insulation (which is £10’s of thousands). Pay less for energy use, but you’ve spent more than the ‘saving’ elsewhere.

  7. Up2snuff permalink
    October 22, 2017 2:17 pm

    It may be reflected in the overall fall in the oil price. The oil price does influence the power generators and for non-grid connected homes becomes very important if they rely on oil-fired heating. The oil price has not, fortunately for the UK, recovered to its $135+ p/b seen a few years ago.

    It should also be remembered, if I recall correctly, that ultimate back-up generation for the UK electricity grid is currently via diesel generators.

  8. Jack Broughton permalink
    October 22, 2017 2:39 pm

    Is not the biggest factor in the lower energy bills low international gas prices?
    Gas is trading at historically very low prices and electricity and gas should be cheaper than they are if it were not for :
    1. Rip off companies taking the over-generous UK power subsidies to Germany, France and Denmark in particular; and,
    2. The climate change levies adding to the costs to benefit the greenies only.

    The present situation on pricing is great while energy prices stay low: but what happens to the UK if they go back to their historical trends, as they usually do?

    As a supplementary question, what would have happened to our energy prices if we had continued to be coal based with no CCA …… how much better off would we all be?

    • Up2snuff permalink
      October 22, 2017 4:46 pm

      Quite correct. The oil & gas prices are traded separately but are inevitably linked because one can be a ‘by-product’ of any extraction of the other.

      Medium to long-term pressure on the oil price is ostensibly downward but it remains to be seen if many other countries ban the sale of oil-fueled vehicles and whether, in advance of that, oil companies abandon existing fields as they face the prospect of becoming uneconomic in the move away from petrol and diesel. That may have an adverse effect of increasing the oil price and creating shortages which will affect other products.

      There could be some very bumpy times ahead!

    • NeilC permalink
      October 22, 2017 5:03 pm

      Much, Much better off

  9. It doesn't add up... permalink
    October 22, 2017 3:11 pm

    So that flexible unit of power, the “home” has shrunk again? Just imagine – it makes all those windmills extra productive. Mind you, OFGEM don’t seem to have a clue what it should be. No less than THREE wildly different definitions in the space of a few lines:

    https://www.ofgem.gov.uk/ofgem-publications/76160/13537-elecgenfactsfspdf

    A MWh is 1,000 kilowatt hours – enough to supply the average power requirement for around 2,000 homes for an hour.

    A GWh is one million kilowatt hours of electricity – enough to power […] around one million homes for one hour

    The average household uses 3,300kWh of electricity and 20,500kWh of gas per year.

    So that’s 0.5kW – no, it’s 1kW – no it’s 0.377kW per home? If OFGEM are that confused no wonder the government is.

  10. John F. Hultquist permalink
    October 22, 2017 5:29 pm

    “… and use more efficient appliances …”

    If one uses a hand powered can opener rather than an electric powered one, takes cold showers, and stops cooking food — the electricity you use and your cost will go down.
    Then the utilities will have to raise rates to cover the income shortfall.
    Economics isn’t called the Dismal Science for nothing.

  11. Malcolm Bell permalink
    October 22, 2017 5:51 pm

    So, I invest in a new boiler and insulation (as I have) and make a sensible efficiency saving. How does that justify the utilities putting up their prices to steal two thirds of my saving? I should get all my saving plus a fair share of the savings they make in improving their operations.

    Not in this world, moral business practise is out of fashion.

  12. It doesn't add up... permalink
    October 22, 2017 9:29 pm

    Some of the data on domestic electricity consumption look decidedly odd and untrustworthy:

    Why did everyone switch off their electric fires in 2008 while at the same time switching on their immersions?

    • Jack Broughton permalink
      October 23, 2017 7:19 pm

      looks like someone is colour blind, or playing spreadsheet games!
      Liked your comments about domestic usage confusion. OMG/LOL….

  13. Athelstan permalink
    October 22, 2017 11:05 pm

    Well it says only Canada left…………. here but I’m thinking huh the treezer the appeaser’s UK more like – unilateral industrial suicide via the CCA all thanks to: the tories/lavs.

    What will it take for Britain to wrench itself out and away from the Kool aid green death cult and with its mass mesmerism induced by the climastrologists/bent politicians?

    Is it just that, here, the extreme left wingnuts in alliance with the critical theorists, media propagandists, masters of the universe [investment banksters], the corporate leeches – have Britons hog tied and force fed the ruinables and green agenda as green noise brainwashing.

    yes, yes it must be – anything Canada can do…………………

  14. October 22, 2017 11:56 pm

    I don’t know where Clare Perry gets her figures. I’ve just done my annual energy supplier switch and the best price I could get for the year ahead was 30% up on last year’s bill – and I can’t recall any year when the bill went down significantly. Perhaps Perry’s falling average is based on a large number of new small city flats requiring less heating – distorting the average downwards. Or perhaps it’s an average of ‘standard variable tariffs’ which have been dropping recently due to political pressure over companies using them to rip off little old ladies who never switch suppliers. Too many confounding factors to distort the ‘average bill’. Better to look at the cost per KWH of domestic gas & elec over the years – vs the oil & gas price – then the effect of the government’s obsession with climate change becomes clear.

  15. October 23, 2017 12:26 pm

    The suppliers have struck back. Price cap = no more smart meters?

    UK ENERGY COMPANIES THREATEN TO DIVEST OVER THERESA MAY’S ENERGY PRICE CAP
    Date: 22/10/17 The Sunday Telegraph

    The Government’s planned roll-outs of “smart” energy meters and electric vehicles are under threat as a result of Theresa May’s flagship conference pledge for a cap on electricity and gas bills, industry figures have warned.
    Senior sources said the Prime Minister’s plans to set limits on energy prices paid by consumers cast into doubt ministers’ plans for all homes to be offered smart meters by 2020.

    They also disclosed that Big Six firms are gearing up for a “significant” legal challenge if the cap was proposed at levels previously indicated by Mrs May and the Competition and Markets Authority (CMA), which would “wipe out all the profitability for the whole industry”.

    http://www.thegwpf.com/uk-energy-companies-threaten-to-divest-over-theresa-mays-energy-price-cap/

    • Gerry, England permalink
      October 23, 2017 1:14 pm

      Follows on from their general generation policy that has stopped anyone building new gas generation even though it is needed. Small comfort that things would be worse under Corbyn.

      • Jack Broughton permalink
        October 23, 2017 7:20 pm

        Could they though???

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