Best company for electricity?

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Kilkis
Posts: 13048
Joined: Sat Apr 21, 2007 3:58 pm
Location: Near Chania

Re: Best company for electricity?

Postby Kilkis » Mon Oct 11, 2021 12:18 pm

mouche wrote:...Unless you buy from a company that actually produces electricity?


I agree BUT it does depend on how they produce it. In Norway, for example, a huge percentage of the electricity, over 90 %, is hydroelectric power. That is effectively solar energy acquired through rainfall. In that case as long as it rains about the same amount, or at least sufficient, every year generation is not subject to market prices for hydrocarbons. I think Iceland is virtually 100 % hydrothermal so the same applies.

In the UK a significant proportion of the electricity consumed is generated from gas and a significant proportion of that is imported through pipelines, e.g. from Norway, but also as LNG. It is that LNG component that is the problem. If LNG shoots up in price on the world market, which it is doing, even companies that generate themselves using LNG face price hikes. Some of the bigger companies have hedged their exposure to short term spikes with futures contracts but that only works for a time.

The problem in the UK is exacerbated by two other issues. The UK has the lowest gas storage capacity in Europe at about 1 week's reserve. It used to be much higher but a lot was decommissioned on the basis that the UK didn't need massive storage because it had good diversity. That's not playing out so well now.

Secondly the UK electricity grid operates on a very narrow margin between maximum demand and maximum supply. As actual demand gets close to maximum supply capability the price charged increases exponentially. This can incentivise generators to cut capability as demand increases as they will get a higher price but they will have reduced costs. For example a single power station might suddenly need "essential maintenance" when demand reaches 95 % of capability. That reduces capability and pushes demand to 99 % of capability and they can charge much more per unit. I cannot produce evidence that this is being done in the UK but it certainly happened in the US. In theory the market should correct but there are a very small number of generation companies and they all know the score. There does not need to be overt collusion as all the companies benefit from the increase in price so why would they step in, increase their capacity and push the price down again? Perhaps next time one of their power stations will need "essential maintenance".

Warwick

Kilkis
Posts: 13048
Joined: Sat Apr 21, 2007 3:58 pm
Location: Near Chania

Re: Best company for electricity?

Postby Kilkis » Sun Oct 17, 2021 10:15 am

According to ekathimerini it looks like the energy regulator is trying to do something about the complexity of electricity supply contracts and hidden clauses. From the article:

    Suppliers will have three categories of standardized rates to offer: Fixed-rate contracts bearing the sign “zero risk,” floating-rate deals with a ceiling on the increase accepted, labeled “contained risk,” and floating-rate ones without any limit, bearing the warning “high risk.” That way consumers will be able to discern clearly whether or not they want to undertake the risk of supply charge hikes.

I wait with bated breath.

Warwick

RogerC
Posts: 5
Joined: Sun Oct 12, 2014 6:49 pm
Location: Kokkino Chorio & Manchester

Re: Best company for electricity?

Postby RogerC » Mon Oct 25, 2021 1:33 pm

Until recently I would have suggested Protergia but after the last bill (which was enormous) I wouldn’t recommend them and plan to change supplier.

I understand about costs going up but the surcharge applied to my last bill was 272 Euros making an effective rate of 0.24/KWH. Worse still is that no warning was given nor any information about alternative tariffs which apparently would have avoid this additional charge.

Left me feeling they just want to charge the maximum possible and have no interest in looking after their customers sadly
Roger

mouche
Posts: 791
Joined: Sat Jan 15, 2011 5:43 pm

Re: Best company for electricity?

Postby mouche » Mon Oct 25, 2021 2:36 pm

Always read the fine print!


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