Energy Prices (Strictly NO referrals!)

[Alex_6n2]

The UK Energy price is currently - £102MWh ! (negative cost)
Octopus giving customers 1 hour free electricity today and 2 hours tomorrow

​

Thank you renewable's !

Yes, thank you renwables for requiring us to pay large amounts of balancing costs because they are internmittent. These costs end up on our standing charges which are only going one way.

 

[Luke_Bowman]

Yes, thank you renwables for requiring us to pay large amounts of balancing costs because they are internmittent. These costs end up on our standing charges which are only going one way.

You do realise the UK uses marginal pricing which means the high electricity price is basically set by gas

 

[Hagar]

You do realise the UK uses marginal pricing which means the high electricity price is basically set by gas

And you ain't getting rid of gas in the next fifty years.

 

[b0rn2sk8]

And you ain't getting rid of gas in the next fifty years.

Given the direction of travel, I can’t see there being a material amount of gas on the electricity grid in 30 years let alone 50.

Sure they’ll be a tiny bit but it will not be getting the price a small minority of the time.

 

[Luke_Bowman]

Depends on the gas, I highly doubt there will be much methane.

 

[Hagar]

Given the direction of travel, I can’t see there being a material amount of gas on the electricity grid in 30 years let alone 50.

Sure they’ll be a tiny bit but it will not be getting the price a small minority of the time.

25 million houses and so far 250k heat pump installs (in 2024 100k), aiming to ramp up to 600k per annum in 2028. Like aiming to build 1,5 million houses over five years, yet to be proven.

Assuming enough trades, assuming affordability for householders and assuming 600k installs per annum on 30 million houses (assuming they can build that many), that is fifty years. New houses mostly come with the new systems but are probably included in the total installs. Obviously hugely ramping up from current levels of ambition will reduce it but thirty years is very very ambitious.

 

[b0rn2sk8]

I specifically said the electricity grid so coming back with a point out heat pumps is probably not super relevant.

In any case the gas grid will be rather interesting to watch as domestic properties and businesses move off it.

The fixed costs will get shared between fewer and fewer people. This will constantly push the costs up for the remaining people on the grid.

This in turn will encourage more and more people away from gas and once this hits critical mass, the funding model will ultimately collapse and that will be that.

I disconnected from the gas grid well over a year ago and can’t say I’ve ever looked back in that year.

The company responsible for the local gas grid in my area have already stopped cutting off the dead legs between the property and the road for people who disconnect.

This is because so many people are disconnecting, they actually can’t afford to do it anymore and they don’t have enough staff to undertake the work. It will be interesting to see how long that takes before it bites them on the rear.

It’s not just people installing air to water heat pumps under the government grant scheme who are disconnecting. The are quite a few viable options out there in both the domestic and commercial space these days depending on what your needs are for your specific property.

 

[200sols]

I think the heat pump revolution (if you can call it that, take up is pathetic) will be stopped dead when Reform get in.

They should encourage air to air as well if they really want take off in numbers, air to water is big hassle for many homes.

 

[b0rn2sk8]

When? The next election is not for 4 years.

That’s a lifetime in modern politics.

Edit: back to energy prices so we don’t get a thread holiday.

Energy is expensive rabble rabble rabble.

On the flip side, export prices are rather nice and I’m £770 in credit just from this summer despite only having a £10 direct debit.

 

[200sols]

In 4 years then... A2W heat pumps are not gaining mass appeal anytime soon.

Electricity prices are not falling anytime soon, heat pumps are appealing mostly to fairly well off people who can couple it with solar and batteries. Mass adoption is just not happening unless electricity prices fall relative to gas prices and with the current system being pursued that is almost impossible.

 

[b0rn2sk8]

Who said they would gain mass adoption anytime soon?

In reality, the only reason people are getting them is because of the massive bung from the government. It’s not just wealthy people though, there are huge numbers of installs (quality not withstanding) going in under Eco4 which is ann even bigger bung and social housing landlords are also retrofitting.

I largely agree with Hagar’s post above, even if there was 600k customers next month, there isn’t the installer base to put them in.

They might make 600k installs in 2030 but the practical reality is it takes 1 installer 1 day to replace a gas boiler at the end of its life. It takes 2-3 people 4-5 days to retrofit a heat pump. Even if every gas installer moved to heat pumps, it’s pretty clear the math doesn’t work.

Although subsequent replacements are back to being a 1 day job and in theory you could do it yourself like for like as no certs are needed.

Like I said, it will be interesting to see how the slow bleed of people away from gas impacts prices as the share of network costs are spread between fewer and fewer people, particularly if large consumers de-carbonise.

The petrol/diesel market will be a good indicator as it looks like we have already passed peak consumption so retailers will need to start taking larger margins to maintain profitability. Market contraction is inevitable, the question is more about when not if.

 

[Hagar]

I find it quite affordable £2 per day in summer and up to £7 per day Oct to Mar. Heating and cooking, gas boiler and central heating, modern appliances.

No way am I splurging thousands on heat pump, solar and battery even when I can easily afford it. That will be for the next owner of this property if they so desire.

Not that I am against it but the mess and disturbance, I have had enough of.

 

[413x]

I specifically said the electricity grid so coming back with a point out heat pumps is probably not super relevant.

In any case the gas grid will be rather interesting to watch as domestic properties and businesses move off it.

The fixed costs will get shared between fewer and fewer people. This will constantly push the costs up for the remaining people on the grid.

This in turn will encourage more and more people away from gas and once this hits critical mass, the funding model will ultimately collapse and that will be that.

I disconnected from the gas grid well over a year ago and can’t say I’ve ever looked back in that year.

The company responsible for the local gas grid in my area have already stopped cutting off the dead legs between the property and the road for people who disconnect.

This is because so many people are disconnecting, they actually can’t afford to do it anymore and they don’t have enough staff to undertake the work. It will be interesting to see how long that takes before it bites them on the rear.

It’s not just people installing air to water heat pumps under the government grant scheme who are disconnecting. The are quite a few viable options out there in both the domestic and commercial space these days depending on what your needs are for your specific property.

I think the heat pump revolution (if you can call it that, take up is pathetic) will be stopped dead when Reform get in.

They should encourage air to air as well if they really want take off in numbers, air to water is big hassle for many homes.

Not sure what I'd do in this house if the boiler died completely (ie unfixable).
Probably the cheapest option right now.

Next house is planning to be long term. That's where I'd personally be looking at solar + heat pumps of some description.

But reform getting in will really slow this down.

A big motivator for people in my position is that gas becomes more expensive while electric becomes cheaper. The more this happens the more likely those who can afford it, but choose not to, make the switch.

 

[b0rn2sk8]

Fit a new boiler.

You can’t retrofit a heat pump in the event of a total failure because planning the job takes a lot of time and if you have no heating or hot water you are not going to be happy to wait for weeks for an install.

 

[413x]

Fit a new boiler.

You can’t retrofit a heat pump in the event of a total failure because planning the job takes a lot of time and if you have no heating or hot water you are not going to be happy to wait for weeks for an install.

Especially Not in winter.
Yeah didn't even think about that aspect I have to say.


Looking at switching right now actually as winter is coming.

Fuse look the only option worth doing. My octopus deal comes to an end in November so probably should get on it.

Looks like exit fees unfortunately though

 

[Nabinium]

My octopus deal comes to an end in November so probably should get on it.

Looks like exit fees unfortunately though

Ofgem rules say if you leave within 49 days of the end of your contract, the supplier isn't allowed to charge an exit fee. Not sure when in Nov your fix ends, but worth keeping that in mind.

Octopus Energy FAQs

Will I be charged cancellation fees?

octopus.energy

Tougher rules on fixed term energy deals come into force as Ofgem’s retail market reforms begin to bite

From today new Ofgem rules come into force meaning energy suppliers are banned from increasing prices on fixed term tariffs. These new rules are the latest stage of Ofgem’s reforms to reset the energy market so that it is simpler, clearer and fairer for consumers.

www.ofgem.gov.uk

Edit: also, not sure if Octopus recently changed whether they charge an exit fee on their fixes, but I don't have one on my current fix with them.

 

[kayone]

Ofgem rules say if you leave within 49 days of the end of your contract, the supplier isn't allowed to charge an exit fee. Not sure when in Nov your fix ends, but worth keeping that in mind.

Octopus Energy FAQs

Will I be charged cancellation fees?

octopus.energy

Tougher rules on fixed term energy deals come into force as Ofgem’s retail market reforms begin to bite

From today new Ofgem rules come into force meaning energy suppliers are banned from increasing prices on fixed term tariffs. These new rules are the latest stage of Ofgem’s reforms to reset the energy market so that it is simpler, clearer and fairer for consumers.

www.ofgem.gov.uk

Edit: also, not sure if Octopus recently changed whether they charge an exit fee on their fixes, but I don't have one on my current fix with them.

Great info to know this, I'm toying with a move as we speak given the impending increases, or at least an other lock in.

 

[Alex_6n2]

You do realise the UK uses marginal pricing which means the high electricity price is basically set by gas

Yes, that's why I referred to the standing charges. Not the spot price of electricity

However, gas is subject to carbon taxes a Government policy not a direct result of the actual cost to make electricity with Gas. The capital for CCGT is largely sunk. We are far from realising the capital costs of deploying and maintaining Wind power in the UK yet. It's surprisingly expensive to get electricity from where it's made to where you need it. Recent CFD strike prices are going up. Floating wind is hilariously expensive. On shore wind will always be hampered by NIMBYS. Batteries at grid scale will remain expensive, regardless of progress in tehcnology, simply because of how much power is needed to balance demand and supply during during winter.

There are several reasons why Gas prices will continue to go down

• There is a glut of LNG coming as projects launched in the USA, Qatar and Australia during the Russia crisis complete
• Over supply of Gas will begin in 2026 and last through 2030+
• Demand for Gas in China has largely stagnated
• India is focused on Coal (lol)
• As time progresses, private organisations will continue to seek reliable base power for their data centres. This will drive Nuclear SMR demand and delivery in the 2030s

By 2035 the UK will have either

1. Realised that relentless focus on renwables whilst ignoring gas and Nuclear is stupid
2. Pushed ahead to remove as much CCGT and Nuclear from the grid as possible

In scenario 2, electricity prices will be much higher for consumers. You will also struggle to make a cup of tea at 5pm on December 22nd, so the government will be forced to push the public into changing their behaviour. That won't end well.

In scenario 1, the general population will have (hopefully) finally realised that renewables aren't actually that cheap. But at least we will have a good electricity mix that keeps the lights on all year round.

 

[bigmike20vt]

In scenario 1, the general population will have (hopefully) finally realised that renewables aren't actually that cheap

and in scenario 1) assuming the rest of the world also take the same approach then the impending climate disaster will come even sooner than it appears to be doing already.

I am not that worried for my generation, but my kids, and his kids........... i am hoping we can put off the inevitable at least enough for my lads generation and maybe they can do something about it.

i dont doubt we need some stable backbone... be it nuclear or gas (preferably nuclear imo), but that really needs to be as small as possible.

what grinds my gears - and it shouldnt as the water is well and truly under the bridge now - but had steps been started to begin a transition back in the early 80s when the major oil companies knew the damage we were doing, it could have been done on a far more relaxed scale but imo the can has been kicked down the road such that the end of that road is now in sight

 

[Alex_6n2]

and in scenario 1) assuming the rest of the world also take the same approach then the impending climate disaster will come even sooner than it appears to be doing already.

I am not that worried for my generation, but my kids, and his kids........... i am hoping we can put off the inevitable at least enough for my lads generation and maybe they can do something about it.

i dont doubt we need some stable backbone... be it nuclear or gas (preferably nuclear imo), but that really needs to be as small as possible.

The rest of the world is the key bit you need to focus on

The UK could sink into the ocean tomorrow, Asia would have added the CO2 reduction back into the global total within about 12 months. China may be building record solar and wind, but they are also doing the same with Coal...

UK CO2 production is going down. New technologies for carbon capture and climate management are being developed, farming yields are up globally, there has never been a better time to be alive. I remain optimistic about the future.

The UK is not a climate problem because we are small fish. Making national grid choices that lead to pensioners freezing to death in the dark is not the answer, just like building loads of coal power stations isn't either. We shouldn't forget the cold kills more people than heat does.

The biggest issue the globe faces is there is no such thing as wealth without energy. No one will convince Africa, South America and Asia to stay poor. We rely on them making smart choices, but nobody in the West can do anything about that.

We should do our best to make smart decisions and set a good example whilst avoiding cutting off our own nose to spite our face.