The energy giant cashes in on soaring power bills with a £350m profit as one in five households faces fuel poverty
BRITISH GAS will stoke the outrage over energy prices this week when it unveils a 25% profit jump thanks to soaring household bills.
Average annual bills have doubled in the past five years to £1,345 because of rising wholesale gas prices and subsidies for low-carbon technologies. One in five households is now in fuel poverty — when more than 10% of disposable income goes to pay for electricity and heating.
The country’s biggest supplier of electricity and gas is expected to report on Thursday that it made a profit of £350m in the first six months of the year — up from £280m in the same period last year, which had unseasonably warm spells.
The jump in the number of fuel-poor homes prompted David Cameron to call a crisis meeting with the heads of the big six energy companies earlier this year. Ofgem, the regulator, has accused the utilities of using complex bills and tariff systems to “bamboozle” customers. Ed Miliband, the Labour leader, called for the firms to be broken up.
The rising cost of energy has also laid bare a bitter dispute in Whitehall in recent months.
Fuel poverty is more than 10% of disposable income on energy? Probably means a subsidy that, along with all the renewable subsidies, increases the price of energy and puts more people into fuel poverty. Does that mean they can’t have the new 1-meter flat screen, the latest smart phones and all the rest of the modern necessities? They, like the US, elected the folks who want to make energy more expensive and we seem to keep on putting them back in office.
Some people do not have the flexibility in their incomes to accommodate energy price hikes. Every year here in the US we lose people to hypothermia or heat-related illnesses for lack of affordable energy for heating or air conditioning. These lives lost should be accounted for in the ‘cost analysis’ of the price hikes.
The vital needs of human beings should not be treated as a ‘revenue stream’ for tyrannical governments.
Even a sacred cow can be bled to death.
In the UK? I don’t think the dangers of hyper or hypothermia are as pronounced as places I’ve lived like SW Michigan. Don’t recall that many problems there, but I confess to not having any data to back up recollection. The best thing we can do for those with limited resources is to insist on the lowest priced, most reliable electricity possible and not heavily subsidizing inefficient stuff like wind and solar. That would go a way to reduce the level of “energy poverty.”
This is the problem with government run monopolies that try to be a business. There is no one to compete against, you can’t change your gas/electric company like your cable/phone service, so the price control aren’t set by the market. Instead, you have a “public services commission” that tries to fill the void. Then when the utility slips one by them (complex bills and tariffs), they try to shift the blame. How much of that bill is charged to the subsidies for the wind/solar/CCS experiments that have proven to be such flops? But lets blame the evil capitalists making their profits on the backs of the downtrodden and poor. I had hoped that solar panels would pan out, so we could get out from under the public utility thumb, but I guess we’ll have to wait for something else. Maybe a basement sized thorium or pebble bed reactor?
We had a power outage here last night. 90 degrees and no A/C. I lay in my bed sweating.
I saw a lineman at the gym this evening. He described what happened, the extent of the damage, and his amazement that they got it fixed so fast.
“so we could get out from under the public utility thumb”
Paint them with whatever brush you want. I see them as heroes.
Sure, GC the individuals often do exemplary work, in very trying circumstances. Just balancing the grid day in, day out with no one feeling it is, to me, very impressive. Even the people in charge the corporate “fat cats”, aren’t trying to oppress anyone, just make a profit, for the most part. But without market competition, there is no check, no rule to measure against, just someone’s guess as to what constitutes a “fair return”. When they guess wrong, the media and politicians will start second-guessing, pointing blame so it doesn’t redound to them. Any time someone has control over your choices, benign intent or no, I start looking for alternatives.
Fair enough, except for the name calling.
I know of places where energy costs of only 10% of disposable income would be a blessing. The wonderful thing about the world is that climates do vary from place to place and if you don’t like the heat and cold where you live now, and what you have to pay to stay comfortable in it, you always have the option of moving. Humans are born with legs, not roots.