From the UN General Secretary:
The combined profits of the largest energy companies in the first quarter of this year are close to $100 billion.
This grotesque greed of the fossil fuel industry and their financiers is punishing the poorest and most vulnerable people, while destroying our only home.
— António Guterres (@antonioguterres) August 4, 2022
There is not a great deal to add to that.
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Liam Fox on Sky News “£85 billion in interest on the national debt.”
Some will go to pension funds etc but much of that looks like a bonus to the bankers. Case for a windfall tax there too.
But it’s simply not true
See my recent post on this
Indeed. I am trying to decide whether he really doesn’t know or is happy to lie to us like his soon to be former boss.
No, not a great deal to add, except perhaps that these companies need to be taken down.
We had a bit of information inserted in with our electricity bill a few weeks ago. It said that 100% of our electricity had come from a renewable source, wind power. (In our case a big farm about 5 miles inland from us). And yet rather than paying wind power rates for our power we are paying gas/oil rates. Reading the posts from the regular commentators wind generated power is cheaper than other methods.
This government would like to think that they are market fundamentalists (i’m so incompetent that it has taken 5 attempts to spell that word correctly), but how is that being played out in the energy markets? Surely in a pure market everybody would be looking at our area and saying we want some of that cheaper power forcing more providers to go with wind.
So either the market is rigged making a joke of ‘market forces’, or/and the market exists only to benefit a few and any solutions it comes up with are likely to be perverse.
The market is rigged against you – deliberately
Responding: the current sturcture of the elec market is based on the energy mix: coal, oil, gas, nuclear. In the 1990s this worked after a fashion (but you needed to be vertically integrated – owning both the generation and retail ends of the market). With renewables emerging from 2000 onwards, the market design based on marginal pricing, started to malfunction. There was also a tendancy on the part of UK energy companies to “milk their assets and not invest” – a comment made by Prof Michael Grubb- who was an economic adviser to Ofgem at a conference in Bx in perhaps 2016. I asked him did he really say that – yes was the response.
By 2016 it was clear that RES in the shape of on-shore wind was by far the lowest cost from of elec generation (e.g. in-shore wind in South Wales levelised cost is now around 3pence/kWh – that’s pretty cheap elec). As of now, PV (commercial roof-top, ground mount) and off-shore wind are all far far cheaper (sub-5pence/kWh) than gas, nuke etc etc. They also have zero marginal cost – which means that when present in any quantity in any system, they WILL destroy the market, by driving prices down (& sometimes into negative territory). This is not an assertion, this is reality reflected in market data.
Thus it would be more correct to say that the design of the market (said design controlled by Ofgem, BEIS and assorted politicos) has failed to adapt to a developing reality (more RES). The reason it has failed to adapt is:
a) it suits generators (cos they make more money) & thus they resist any change
b) market fundamentalists which populate Ofgem and BEIS believe that the market is “perfect” (honestly – they do)
c) your elected representative/imbecile is too stupid to understand what is going on & what needs to change – & thus no political pressure for change.
Ofgem has a consultation out on market reform. But don’t get your hopes up – they talk about 3,4,5,6 years before there is any reform.
Personally, I think it (EMR) will get overtaken by “events” – UK serfs battered by inflation @ 15% and massive energy prices rises are likely to take matters into their own hands.
Thanks
Just the first quarter………………..goodness me!!!