LATEST MOAN FROM YOU AND ME - 2022

I seem to remember reading somewhere that English Law often puts property above personal injury.

 

Im obviously being really stupid but I cant see why energy companies are making such large profits bearing in mind how short energy is supposed to be.

I understand supply and demand, at least I think I do, but usually the price rises because something is short or difficult to get hold of but obviously there is no shortage of energy otherwise the companies would not have as much energy to sell and make large profits.

So if I was selling cabbages and I could only get hold of 50 instead of 100 like I did last week I'd put up my prices so I could make the same profit from fewer cabbages.

Why are energy companies putting up prices when there appears to be no shortage as such, if there was they would be struggling to supply us and not making huge profits.

 

If you had your 100 cabbages and everyone was struggling to buy cabbages and the guy next door was selling his cabbages at £10 each, you would too. It is not so much a shortage of energy as a perseved shortage of energy. All the brokers are bidding to buy it so if Shell can get $200 a barrel from one broker they are going to sell it to your broker at the same price.
Hope that makes sense.

 

Yeah, I see what your saying.
But how we get away from this thinking seems to be the problem.
I guess its similar to the toilet roll problem at the beginning of covid.

 

I bet energy prices are not rising in Russia.
Its probably our capitalist society that allows this kind of thing to happen.

 

There's no immediate shortage because it's summer, and most countries have filled up their gas storage tanks. Between what they have in reserve, and what they're still able to buy, there's enough for now. That will all change in winter when people start cranking up their heating. Some might think what's gas got to do with electricity. Many power stations run off gas, and it's the same has as what runs central heating.

So why the crazy prices despite there currently being no shortage? It's about 12 or 18 month contracts to buy more, and with shortages anticipated for winter, those contracts basically go to the highest bidder.

The problem was entirely foreseeable. Germany, the biggest economy in the EU, has spent the last few years decommissioning nuclear power stations and reinstating gas and coal fired ones, and most of Europe has done exactly nothing to sort out their energy dependency on Russia, despite knowing for at least 8 years that they're buying from a country hellbent on war. Britain is no better, apart from a few half bottomed renewable energy projects, I can't think of any major energy project for years. We just entrust the European and Chinese companies to look after us.

 

And I can't understand, with those profits, why prices have gone up. Energy companies should be legally required to hand back some of that profit by reducing customers bills. But of course that won't happen, for the reasons Loofah has quoted.

 

It wouldn't be so bad if the UK hadn't gotten rid of its gas storage. Similar to what we did with our gold.

 

I largely agree, but where I slightly disagree is on the effect to us as consumers.

Since everything is now in the hands of private, international companies, gas prices are basically like the stock market. It doesn't matter what the local situation is. If the UK had state owned gas reserves, maybe we would benefit. But when it's owned by a multinational company, it doesn't matter where the gas actually is. The price is based on the international market rate. So we could have enough gas to last us forever, but if the rest of the world is in a bidding war, driving the price up, then that privately owned gas in our stores would still be sold on at market rates. Meaning we'd still be ripped off.

 

So, if you think Boris was not that great, get a load of this one from the right arm of our head greeniac, Trudeau

Trudeau government to ban single-use plastics issues advice: eat with your hands

 

The chippies round about here supply wooden forks but you would need to be royalty to eat a fish supper with a fork.