POWERCUTS

Page 1 | 2 | 3
 

It has emerged that the profit margins of energy companies have soared 733% in four months. The Big Six gas and electricity firms now make an average of £125 per customer a year on dual fuel bills, up from just £15 in June. Industry regulator Ofgem, which released the figures, accused the suppliers of "poor behaviour, complex tariffs and a lack of transparency". The average annual gas and electricity bill soared by £175 over the summer, and could be £1,345 by November, although Ofgem expects profit margins to fall back next year.

The figures are based on a snapshot of the amount energy firms would make if prices for dual fuel customers were unchanged for the next year. Ofgem boss Alistair Buchanan said, "When consumers face energy bills at around £1,345, they must have complete confidence that this price is set by companies competing in a fully-competitive market. At the moment that is not the case." British Gas, Scottish and Southern Energy, Scottish Power, E.ON, RWE npower and EDF, have all raised bills since August citing rising wholesale prices.

They offer a huge range of tariffs depending on whether you have an online account, pay by direct debit or want your price fixed for a set period. An average household would pay a dual fuel bill of around £1,022 under the cheapest tariff but could end up paying £247 more on a more expensive one. Ofgem wants a new standard tariff introduced, based on a simple unit price for energy used and the standing charge. Richard Lloyd of consumer watchdog Which? said, "A simple format should be applied across all tariffs, so people can compare energy deals at a glance." (Source: The Sun, Oct/11)

Thousands of pounds worth of business was lost and hundreds of revellers were left out in the cold when a power cut hit part of Derby city centre. Tonic, the Friary and the It's a Scream nightclub in Friar Gate were among those forced to close early when the power went off at 9.47pm on a Saturday night on what they believed could have been one of their biggest money-making nights of the year so far. About 30 properties were affected by the power cut, which lasted until 2.30am.

East Midlands Electricity was called to sort out the problem but engineers had to call the police to get into the Bold Lane substation because the locks had been changed recently and the engineers did not have the right key. Dave Satchwell, network manager for EME, said, "In the end we got in with assistance from the police. It was a low voltage problem and although we didn't find the exact problem, we sorted it all out and it's not likely it will happen again." He said that the power cut was not related to power cuts which affected 422 properties in the St Mary's Wharf area.

John Whitehead, bar manager of the Friary, said, "This is the third time in two months this has happened. It's becoming a recurring problem, which is losing us a lot of trade. Normally we take between £12,000 and £15,000 on a Saturday night and it would have hit the higher of these last night as it was so busy early in the evening." Dylan Peat, general manager of Tonic, said, "We lost power in the tills, credit card machines and toilets so we had to close the bar. We kept the restaurant open by candlelight and did the bills manually but it was a complete nightmare. It was pay weekend and there were a lot of people.

It was probably one of the biggest Saturday nights so far this year. It must have cost us the best part of £3,000 and I don't think we can get compensated as the power wasn't out long enough." Nicholas Dunkley, general manager of Pierre Victoire restaurant, said, "We didn't have to shut but we did have to turn people away. The lights went off and the dishwasher and microwave stopped working. If it had happened any earlier it would have been a disaster."

East Midlands Electricity network manager Dave Satchwell must think his customers have the memories of goldfish. After yet another power cut in Derby city centre, he offered the solace that "although we did not find the exact problem, we sorted it all out and it's not likely it will happen again". No, this power cut will not happen again. But another one will, if the evidence of recent months is any guide.

Customers are heartily fed up with the unreliability of their electricity service. Householders, businesses, local authorities responsible for traffic lights - all have had their service disrupted far too often. It has happened twice in the heart of Derby in less than a As far as householders are concerned, it's a darned nuisance and an inconvenience.

For businesses, it can lead to the loss of tens of thousands of pounds if they have to close, as happened to several pubs and clubs at the weekend, and the ruining of foodstock which may be in freezers. The competence of East Midlands Electricity reached a new low in the latest Derby incident - because the locks on the Bold Lane substation had been changed and its engineers did not have the right key.

Less than three weeks before, Chris Scoggins, of National Rail Enquiries, was ridiculed when he said that one of the reasons his firm was considering moving its calls centres to India was because there was less chance there of power cuts affecting the service. That comment begins to look more and more like good business sense.

Household energy bills will increase by £50 as the impact of green taxes triples over a decade. The sum the Government levies from energy use will rise to more than £16 billion by 2020. Policy Exchange, which has close links to Conservative ministers, calculated that the cost of green taxes, surcharges and other levies on energy will go from £5.7 billion this year to £16.3 billion in 2020. In 2020, some £6.4 billion of the total will come from levies applied to domestic energy consumption. That is up from £2 billion today.

The increase will add £40 to the average household gas bill and £8 to an electricity bill, according to data from the Department of Energy and Climate Change. Household energy bills are increased by a number of Government environmental policies, including the Renewables Obligation and other levies applied to energy usage to fund low-carbon power generation. Energy companies also face charges for schemes including the EU’s Emissions Trading Scheme, costs which are then passed on to customers.

“Green” levies are meant to increase the price of carbon-emitting energy use, with the aim of funding alternative sources and encouraging consumers to change their behaviour. Much of they money raised by such levies does not end up with the Treasury, but “green taxes” are regarded with suspicion by some consumers, who regard them as a disguised revenue-raising measure. Simon Less, Policy Exchange’s head of environment and energy, said that the various environmental charges should be considered taxes by another name

He said, “The funding for these policies may come through energy bills, rather than the tax man, but it is a tax, and an increasingly large one paid by individual households and firms. Its scale makes it even more important that this money is used in the most efficient way possible.” Warning about need to gain public support for measures to combat climate change, his report says that “raising taxation through energy bills, rather than, say, using income tax, is relatively regressive, because the poorest households tend to spend a larger proportion of their income on energy.”

Dr Less also said they funds that are supposed to go to renewable energy sources are often spent inefficiently. He said, "Climate change is a major threat. It needs to be tackled as a priority, and that will be expensive. But the public and industry will not put up with paying such large sums if the money is going to be wasted.” The Carbon Reduction Commitment will require big companies to buy “permits” for their carbon emissions. (Source: Daily Telegraph, Aug/10)

Householders are facing record high heating bills as greedy energy firms cash in on the coldest winter in 30 years. Energy demands falling on to doormats in the next few weeks will be 20% more expensive than last year despite a huge drop in the cost of wholesale gas. Typical households can expect a quarterly combined gas and electricity energy bill of £616, a rise of £104. The increase is part of a trend with annual bills having rocketed by 127% since 2003, from an average £543 to £1,233. Richard Hall, energy expert at watchdog Consumer Focus, accused energy giants of profiteering from the big chill and called for a Competition Commission investigation into the sector.

He said, “Suppliers have failed to fully pass on wholesale price cuts and have boosted their profits by not reducing prices before customers turn up their heating in the cold winter. All of the suppliers will be enjoying rocketing profits while millions of consumers worry about how to afford to keep warm.” Wholesale gas prices plummeted by 60% in 2008/09, when the gas being used now was bought, but this cut has not been passed to consumers. And an estimated 30% surge in the nation’s energy use this winter will further line the pockets of energy suppliers. British Gas is set for a 50% rise in annual profits to more than £500million, while Scottish and Southern Energy’s profits rose by 36% in the past six months. (Source: Daily Express, Feb/10)

<<< Prev