Energy company profits

It’s horrific, and the winter is going to be catastrophic for millions. January bills alone for the average house are going to be £500. Old people could well die because they won’t be able to afford heating. Mind you, I was trying to think back to my childhood and up to age about 30, we didn’t have central heating, we of course had coal fires and I don’t remember being so cold it was unbearable.

Nonetheless, I do think the government did ok when they announced the package earlier this year, which gave those on benefits £1,200 to help. However, that was before these latest massive increase estimates, so they probably do need to look again at further help this winter.
The thing is half of the top up for folk on benefits was paid in cash this month and most of the recipients will have spent it by now ,never mind by October.
It was totally false economy and should have been credited against bills like the universal energy payment that everyone gets in the Autumn.

If you throw money at people a lot will just spend it. That’s not a criticism as such, but it’s what happens a lot of the time. Boohoo and Pretty Little Thing will have a boost in sales this month that’s for sure 😏
 
The thing is half of the top up for folk on benefits was paid in cash this month and most of the recipients will have spent it by now ,never mind by October.
It was totally false economy and should have been credited against bills like the universal energy payment that everyone gets in the Autumn.

If you throw money at people a lot will just spend it. That’s not a criticism as such, but it’s what happens a lot of the time. Boohoo and Pretty Little Thing will have a boost in sales this month that’s for sure 😏
Yep, I know someone who got the £326 and it’s gone
 
To be fair, from the 1970s onwards, the UK’s nuclear programme was a shambles. We built 14 very complicated “Advanced” (pah!) Gas Cooled Reactors which had an appalling record for availability. They were averaging at about 60% of capacity in their first 20 years while a PWR would be 90-95% plus.

The CEGB wanted PWRs from the early 70s but the government of the time (Energy Minister, a certain A.W. Benn, with the UKAEA whispering false promises in his ear) decided to stretch the old Magnox concept beyond its capabilities. Simply, because they did not want to pay royalties to Westinghouse for their Pressurised Water Reactor design. While the French built 54 PWRs.

That momentous crass decision wrecked the UK’s ability and infrastructure to build nuclear stations ever after. That’s why we have to ask the French for help, while we try and resurrect an industry to build Small Modular Reactors. But the French have their own problems currently in refitting the ageing half of their own nuclear fleet.
I work in the energy industry and have to consider the full techno- economic assessment and lifecycle cost.
You make some very good points and if you are correct about availability then the decision should have been a no brainier.
 
Once again, Blackpool voted for conman culture, energy companies freely taking the piss. I don't know what else you expected??
Real Labour under Corbyn would've set up a non profit, state owned energy company..it was all in the manifesto. :)
 
I hadnt realised that Bulb had gone bust in november and was now in gov admin. Octopus looking for 1 billion pounds from the government to buy the company / customers.
 
BP profits announced today, showing $8.45 billion profits in second quarter of the year, highest for 14 years
Feature in the Times yesterday. Only Luxembourg has reduced the tax on fuel by a smaller amount than us. Germany 25p off, pump price £1.56.

The Government could do so much more but are seeing their mates profiteer instead.
 
Oil majors will be making huge profits on crude and refined products. Much of the reasons behind those massive profits is linked to the war. However, the USA has just released data showing that gasoline/petrol demand for Q2 2022 was the lowest level since Q2 2001 (excluding the ‘covid years’). Usage is down. Pricing is at record levels and so are profits. On that front the government could definitely offer some duty release and could offer the public some visual aides in terms of price evolution. Who on here knows where to find the daily price of wholesale gasoline for example?

As for ‘energy’, there’s also things that can be done, which would also help us buy, what is an essential resource - for households and industry. As those in the know will attest, there’s parts of the ‘energy’ sector that are producing energy irrespective of demand because the output is driven by other rationale.

We also SHOULD have 100% control in the wholesale price of energy produced by domestic sources. The idea that pricing HAS to be linked to international pricing is nonsensical. An international producer can choose where to sell, based on the best price netback, a UK owned resource can price all/some of its supply based on cost of production and ROI.

There’s nothing I can see - and please correct me if I’m missing something - that at least allows for a pricing structure that ensures UK energy is sold to UK homes/industry at price levels that doesn’t destroy the UK economy for the benefit of a tiny proportion of the population (or international shareholders).
 
Yes " lifelong Tories " just want more of the same it seems, the rich doing well at others expense. Figures this week showing 70,000 in the UK paying their tax offshore, presumably avoiding large amounts of tax here. Current Tory leadership candidates wont talk about this, especially as many of these are large donors to their party.
The thing is many of these life long Tories that think they are rich are nowhere near it.
They buy into the old school traditional stuff that the Tory party stood for but the truth is the Conservative party is now a vehicle for the mega rich to forward their agendas, the main one being tax the super wealthy as little as possible!
 
Oil majors will be making huge profits on crude and refined products. Much of the reasons behind those massive profits is linked to the war. However, the USA has just released data showing that gasoline/petrol demand for Q2 2022 was the lowest level since Q2 2001 (excluding the ‘covid years’). Usage is down. Pricing is at record levels and so are profits. On that front the government could definitely offer some duty release and could offer the public some visual aides in terms of price evolution. Who on here knows where to find the daily price of wholesale gasoline for example?

As for ‘energy’, there’s also things that can be done, which would also help us buy, what is an essential resource - for households and industry. As those in the know will attest, there’s parts of the ‘energy’ sector that are producing energy irrespective of demand because the output is driven by other rationale.

We also SHOULD have 100% control in the wholesale price of energy produced by domestic sources. The idea that pricing HAS to be linked to international pricing is nonsensical. An international producer can choose where to sell, based on the best price netback, a UK owned resource can price all/some of its supply based on cost of production and ROI.

There’s nothing I can see - and please correct me if I’m missing something - that at least allows for a pricing structure that ensures UK energy is sold to UK homes/industry at price levels that doesn’t destroy the UK economy for the benefit of a tiny proportion of the population (or international shareholders).
Even the generation facilities are majority owned by foreign entities, and over the next decade it will get substantially worse.

Reason is the wrong word in my opinion to explain the profits and the link to the war, its more a justification by the energy companies, an external (to the industry) factor that will scare people and hence not take too close a look at what they are actually doing.
 
Even the generation facilities are majority owned by foreign entities, and over the next decade it will get substantially worse.

Reason is the wrong word in my opinion to explain the profits and the link to the war, its more a justification by the energy companies, an external (to the industry) factor that will scare people and hence not take too close a look at what they are actually doing.

Second part first:

Irrespective of the wider 'complications' some of the current profits are directly linked to the war. Without the war and sanctions on Russian crude, then the crude price wouldn't have increased by the scale it did. On Feb 23rd, Brent was worth $97 per barrel. At the peak of its rally in June, it was worth $123 per barrel.
Sanctions against Russian refined products, have limited the flow of feedstocks into Central and European refineries and tightened those markets, pushing up pricing on the spot market.
There's wider 'games' at play in terms of how products are traded to maximise profit, but you can't rule out the influence on the war. It's part of the narrative and with (some) justification.

First part second:

Indeed - this is part of the bigger problem and why there has to be some element of central government control on this sort of infrastructure and 'business'. We heard the same points effectively raised around fracking; what would be the point of decimating our natural land (especially in such a small country) if the populace get no benefit from it in terms of cheaper utilities. Energy is a necessity now. There's nothing you can do without access to gas or electricity. No basic functions of our lives work without it. Same as access to water or (to the extreme) oxygen. No sensible society would leave itself at the mercy of others in terms of getting access. Unless there's ulterior motives in play.
 
Second part first:

Irrespective of the wider 'complications' some of the current profits are directly linked to the war. Without the war and sanctions on Russian crude, then the crude price wouldn't have increased by the scale it did. On Feb 23rd, Brent was worth $97 per barrel. At the peak of its rally in June, it was worth $123 per barrel.
Sanctions against Russian refined products, have limited the flow of feedstocks into Central and European refineries and tightened those markets, pushing up pricing on the spot market.
There's wider 'games' at play in terms of how products are traded to maximise profit, but you can't rule out the influence on the war. It's part of the narrative and with (some) justification.

First part second:

Indeed - this is part of the bigger problem and why there has to be some element of central government control on this sort of infrastructure and 'business'. We heard the same points effectively raised around fracking; what would be the point of decimating our natural land (especially in such a small country) if the populace get no benefit from it in terms of cheaper utilities. Energy is a necessity now. There's nothing you can do without access to gas or electricity. No basic functions of our lives work without it. Same as access to water or (to the extreme) oxygen. No sensible society would leave itself at the mercy of others in terms of getting access. Unless there's ulterior motives in play.
i dont disagree, and i cannot rule out the war, and covid and brexit but its the wider games at play which i think is the biggest problem where profitisation is the key motivator, any kind of crisis justs drives most companies to exploit whatever advantage they can and they are allowed to do that, in fact encouraged to do that. Even medium term it just compounds the problems. you can imagine in a not too distant future when energy company profits are not at such high levels there will need to be some other radical impact to maintain what the business, shareholders and management teams not accept as normal.

Energy is one of those resources (particularly in distribution to end users) where I'm not wholley convinced that high profits (in the way we currently experience, require) can be sustained without creating supply security problems in the medium term. Water is definitely another and Data might be the next one that becomes problematic (which is entirely profitised). You are absolutely right in that no sensible society would leave it itself at the mercy of others but society has rarely been sensible.
 
Can anyone logically explain ( save avarice ) why the Gov't is fixing the energy price cap at a level that allows these windfall profits to be made
It's beyond ridiculous
It’s ofgem that fixes the cap, not sure whether the government can intervene/overrule their decisions. Seems to me they should and quickly.
 
Can anyone logically explain ( save avarice ) why the Gov't is fixing the energy price cap at a level that allows these windfall profits to be made
It's beyond ridiculous

Shell etc are oil/gas extraction companies and are not affected by the price cap.

The £1.2bn figure for Centrica is misleading, and seems to be a case of cherry-picking a number to make a point, it might be more accurate to say that the group lost that amount instead.
 
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