Supply and demand, price capping and fuel poverty - whatever next?

  • 8 October 2021
  • 7 replies

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  • Rocket Scientist
  • 13652 replies

The government’s stance is that the increased cost of energy WILL be borne by consumers, and they have refused to bail out the energy companies who are falling like ninepins.

I’m not going to get into a discussion (in this thread) about whether they should bail them out, or whose fault it is that it came to this because it’s not relevant to what’s going to happen next and would make no difference to consumers.
The government are prepared to pay the companies with the bigger pockets (as suppliers of last resort) to take on the customers because they had no option but to do so, thus rebuilding the monopolistic conditions they were so prepared to dismantle by perpetrating the ludicrous situation saying that everyone should switch to reduce their costs.

Secretary of State for Business, Energy and Industrial Strategy, Kwasi Kwarteng’s  pathetic attempt at pacifying the masses by saying that we’ll plan for this, and in (a non specified mythical) future and when we  all have lots of green generation capability we wont be beholden to global supply and demand  and prices will fall was patronising and disingenuous.

Ofgem have said that price regulation needs to be looked at because this crisis has unearthed the flaws in the current pricing regime - that can only mean one thing for the consumer.

The entire thrust of the government (and as a result Martin Lewis’s previous advice) was based on a lie, the whole concept of switching is fatally flawed, it always has been, and it’s precisely what encouraged the setup of so many failed energy suppliers. Looked at on the whole it’s a race to the bottom based on the smoke and mirrors of a supply chain which is subject to forces over which no person (other than a few Saudis and Putin) has any control, least of all governments.

The energy market “calmed” after Putin said he would supply more energy to Europe, it doesn’t take much imagination to realise that was a deeply political move while he had the testicles of European governments in his grip.

So what’s next?

The price cap (if it survives in anything like it’s present form) can only go one way, sharply up. Fuel poverty (as defined by the earlier accepted definition of more than 10% of income being spent on “fuel “ (and which should now be called energy poverty)  is going to hit the most vulnerable and elderly hardest, and then it’s going to hit everyone else, even those who thought it would never be a problem.

My prediction is, if price capping continues, it will be likely nearer the £1900 to £2000 mark even if prices fall, because that will offer further protection to the remaining small suppliers wo have survived.

Price capping was originally devised in it’s current guise to prevent energy companies exploiting customers who were switched to a variable tariff. We now need a system which prevents us being exploited by a government who think the market will solve everything. Oh the irony. of it all (not the iron, you won’t be able to afford to do the ironing)

Look on the bright side , it’s one way of moderating CO₂,  as huge numbers of people can no longer afford to heat their homes and steel and aluminium and industrial manufacturing is strangled by energy prices. (as it is being in China)

Anti-depressants (cheap ones)  free with every energy contract? Now there’s an idea…or better still heavily subsidised insulation… (but not as a result of glued botties on theM25,  because that would be  seen to be giving in to common sense)





7 replies





We need a cap on the number of extra returns in posts. Perhaps the government can step in?





We need a cap on the number of extra returns in posts. Perhaps the government can step in?


No we don’t, we need all the heat created by hitting those extra returns to keep us warm.

Userlevel 7
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‘scuse me lads..but we don’t allow groups of feral youths in here! The only thing that needs hitting  is you lot for picking on poor defenceless  whitespace me. You could have had the decency to at least violently disagree with the post contents, and make yourselves useful.

sheesh is nowhere safe these days…

P.S. apologies for the missing h in who, rubbish keyboard and worse poofreader...(sic)

(whitespace deleted, I hope you’re happy!)



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The latest idea is to transfer the green levies ( taxes ) from electricity to gas usage in an effort to convince people to install heat pumps etc.

These levies make up 25% of our bills

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@woz I certainly don’t disagree with your summation but whether the Government provide support or not we still pay for it. The Government never does. We pay for the wastage and the many people employed unnecessarily to “advise.” A cure is change the mentality of politicians from short sighted, what is good for the party at present to make us popular, to what is good for the country in the long run plus we need people in the right places with the expertise to advise properly, able to think through their ideas and proposals and think laterally. Think of outcomes. Instead we seem to lurch along. We don’t rely on Russia for our gas but Europe does and pressure there affects prices everywhere. That is not rocket science. Yet some bright spark decided back in the early 2000s we did not need to keep a store of gas to the level we used to. Lack of investment over 20 years ago in energy production clearly was to have consequences. Indeed lack of action to reduce the affects of a recession back in 2007 had immense consequences, yet it was foreseeable. No action taken. It was not seen as popular for the party.

It is only in the last month or so that the penny seems to have dropped that we need to produce more electricity to replace fossil fuels and get the price down. 

We are encouraged to shop around. The concept is a good one. But nobody was checking the viability of some of the companies set up in the front room of a person’s home. Minimum standards ought to have been imposed. They will be now but the horse has bolted.

I notice nobody is shouting from the rooftops that the production of lithium produces big environmental issues for the planet. I believe worse than gas. Yet battery power and use of batteries to store power at home is pushed. Intelligent for sight and planning is needed, not off the cuff ideas that sound popular.

As you say there will be some fuel poverty ahead.  My current fuel cost is just over 20.5% of my OAP.

Badge +5

The latest idea is to transfer the green levies ( taxes ) from electricity to gas usage in an effort to convince people to install heat pumps etc.

These levies make up 25% of our bills

It is many months ago now, and long before the present crisis, that it was announced the levy on electricity would be frozen, and that on gas, which had been frozen, unfrozen.