I have accumulated a total of 290k today. I am truly grateful for all the knowledge and information you have provided me over the past few weeks. I started with 55k just 2 months ago.
Sophie Rogerz? I was introduced to her by a friend. My husband and I have been working with her for months, and it was through her profits that we were able to grow in the real estate market.
Internet Archive - 1879 letter from Baruch Levy to Karl Marx .."Jews will attain world domination by the dissolution (ending) of other races,Thus will the promise of the Talmud be fulfilled, in which it is said that when the messianic time is come, Jews will have all the property of the whole world in their hands"
What is the point of a regulator when they seem to kow-tow to the rapacious energy companies?? Whenever the cap is raised the energy companies take advantage of it to price gouge. How long must we tolerate this for?? It's a disgrace. 🤬
Because these companies are powerful. Don't forget that they give a lot of money to the government. Wonder just how powerful they are? They wrote the legislation for preventing protest and demanded 10 yrs imprisonment for oil protestors. You and I have only one vote each but these gas companies have the direct dial numbers of the relevant minister(s). On top of that people blame the regulators who are gagged and de-funded.
@@marumaru6084 It goes up because of the price of GAS if we had a net zero grid then you wouldn't get the price changes due to enough mass storage on the system to use and store all the always on power
What Richard outlines here is just the tip of a deeply murky iceberg. You might think that Ofgem are there to represent the consumer, but actually their main mission is to ensure that the market is profitable - otherwise the generators pack up and the lights go out. There is a review into pricing going on at the moment, but don't expect anything dramatic.
In Orkney and Shetland, we pay roughly double the UK price cap for electric, and the UK price cap is roughly double (according to recent reports) to what folk pay in France for their electric. So if you take the current UK cap and pay for 5 years worth of electric in Orkney and Shetland. The amount spent would be able to pay for 20 years worth of electric in France!!! And ALL the electric used in Orkney is produced by renewables based in Orkney too!!! Putting prices up again, is nothing more than a PISS TAKE!!!
You pay the national grid price set by the regulator. I have a solar battery system due to the abundance of renewable s with just batteries you should be able to save the capital cost in under 5 years. Wind is always on and it costs to turn the turbines off so in England we can get as cheap a rate as 7p down from 24p for overnight use. A 10kwh system should cost around 3k my annual energy bill used to be 2.5k
@@SlowhandGreg But why should they pay the cost of burning gas, when they don’t do that. Indeed Scotland as a whole generates only a tiny amount of its electricity from a gas powered station at Peterhead.
Ironically the largest electricity generation company in the UK is owned by the French ( EDF ) who use _us_ to subsidise _their_ energy cost. Go figure eh.
Martin Lewis declared, at least a year ago, that "the market is broken". We also find that regulation is a joke and no politician is brave enough to nationalise supply. Politicians work for corporate interets and NOT for the people.
@billB101 They stole it all from us in the first place. We should take it back. The great British public were hoodwinked into buying shares in something they already had a share in. "Don't forget to tell Sid".
@@Neokretai I watched that a while back and honestly I think it's nonsense when compared to energy, the bill for buying back our energy from companies like EDF would be absolutely enormous if indeed they wanted to sell in the first place (and why would they _we're_ literally picking up the tab for _their_ energy subsidies ) This not post WW2, there's not the sentiment for this. And then there's the blowback if it fails and our economy tanks. Saying it is one thing, doing it is entirely different.
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Most rich people stay rich by spending like the poor and investing without stopping then most poor people stay poor by spending like the rich yet not investing like the rich but impressing them. People prefer to spend money on liabilities, Rather than investing in assets and be very profitable
Very true. Chicago being once renowned for being the centre of organised crime is known for its brand of a seemingly criminal brand of economics via the Chicago School of Economics; that of Neoliberalism. A clearly open route to syphoning off profits and socialising losses under the nose of governments who retain no powers to control the blatant multiple levels of criminality from Hollywood and other types of false accounting to ripping customers off in numerous ways; e.g. overcharging for goods and services or not providing the services they are paying for etc. Boeing is a clear case in point. Provided with $ billions of hand outs by the US Government while building shoddy products and paying out massive share dividends and large bonuses to the CEO etc. US Health insurers are now more prominently in the frame for putting profits before providing what their customers actually pay them for. It's about time this house of cards collapsed.
Except that Richard didn't mention that solar and wind power plants pretty much all operate under a 'contract for difference' at a much lower price. The government keeps most of the 'massive profits' that he mentioned. It's more of a stealth tax.
Well it was put in place many decades ago when it made sense. It hasn’t made sense to charge that way for several years now, but no government so far has addressed the issue. Oddly Mr Putins actions have brought the matter to a wider public attention, so more and more people have looked into it and found out how it really works. The more we know, the more we raise it, the better chance we have of getting it fixed.
It was probably reasonable at the time it was originally done, but the world has changed, and the pricing formula has not been adjusted as it ought to have been. Because politicians, our politicians by and large anyway, are not detail focused people and are not good at asking detailed technical questions either.
At that time the system was set gas was the biggest energy source i think . So it sort of made sense, well it didnt really. Now it makes no sense and desperately needs reform.
This is a belief system and therefore it is its own reward. It is austerity under the guise of a "market mechanism". And as we know from Clara Mattei austerity is deliberate and murderous class war. And we should know by now that class war is the mysterious missing "vision"/policy agenda of Starmer and the British regime
@@oscartrain1151 Just pointing out that both the system and high prices were the same under the previous administration. This is a government failure issue across the board across all parties and not restricted to a Labour one. Will they fix it now they are in charge or allow it to continue? I have no idea. They will be judged by their actions (or lack of).
People should be very angry about a lot of things.lnstead the hard of thinking get very angry about what the right wing media feed them.they are very angry about benifits fraud because the daily hate mail are forever telling them to be so.however the daily hate mail says nothing about tax fraud which is a much bigger problem.l wonder is that they are owned by foreign overseas billionaires.when the investigation into off shore tax havens was revealed it was in some papers for barely a day and I'm sure the daily hate and the daily gammon express found another story to cover.billionaires sucking out wealth from this country should be the source of anger but instead it's stop the boats that gets all the attention . Y
Part of the standing charges are to pay people like me for the solar energy that I produce- and they use mostly myself. For 25 years. Thank you for your contribution.
Psst, she’s dead , child…..we now have a bloke called Starmer in charge. That’s right, the bloke who now ‘run’s’ the country. He promised that energy prices would go down…….😂😂😂
She wouldn't have put up with the shit we have to deal with nowadays ( oh, and she hasn't been in power for over 30 years so, you know, time to move on maybe)
This government ( based on their performance so far ) are terrified of upsetting the treasury/markets / big business and , in doing so , are annoying all the people that they promised to help
Many of the executives at the regulatory body will go on to get jobs in these energy companies! Is this a shock? Greed, corruption & political incompetence.
Another ludicrous situation is that Scotland the one part of the UK that produces more electricity than it uses(mostly from renewable sources)and in fact exports a sizeable amount of that production to England has by far the most expensive electricity prices in Europe and this is entirely down to Westminster policy and dogma
@@stanleyshannon4408 The companies paid for it with investment by the Scottish government as well as the EU(before England had a brain fart and forced the UK out of the EU). however the amount of money the electricity costs is set by Westminster according to the price of electricity generated from gas which is the most expensive way to generate electricity; the so called"green levy"on renewables is actually there so that it does not become obvious how much cheaper than gas renewables are. The transport levy for electricity through the laughingly named national grid is also set by Westminster and heavily favours electricity generation in England and penalises electricity use in Scotland which is daft as by far the most capacity for generation is in Scotland
@@davidmcintyre8145the distribution costs in Scotland are more per head because Scotland has a sparse spread out population except for the central belt.
@@waltermcphee3787 The fact that the national grid in Scotland has not been updated in 70 years and cannot cope with the power already generated never mind the potential shows what the English government thinks of Scotland. By the way you asked who paid for the renewables and that I answered. Now i ask who spaffed all the taxes earned from the electricity companies just as they spaffed the taxes from the oil companies to donors,family members,vanity projects like the Dome and mistresses rather than keep prices down like they did in Europe over the last few years? It was the Westminster parliament and of course retired Westminster ministers often sit on the boards(paid but not doing any work)of the energy companies. There is also the fact that until the clearances both Highland and Lowland by the landlords looking for more money(shades of the modern BTL system)the Highlands actually had a larger population than the Lowlands. Perhaps that is London's worry; that the South east of England which as we know from environmental data will become all but inhabitable due to lack of potable water within 30 years will be overtaken by the Highlands of Scotland(an area they have hitherto seen as mere backward colonial savages)as the nexus of the UK or what remains of it economy or that it would give the Scots an economic impetus that cannot be gainsaid to leave the UK and join the EU(meanwhile leaving England ever more dependant on imports of food,oil,gas,electricity and most important workers)
renewable energy is a BS to supply the whole country. a country with no sun no solar panels. Renewables always fail, and this is their plan to freeze you
I agree the terminology is mad. It's the system which they thought could stimulate renewables 20 years ago. If you want to save money, get a smart tariff from, say, octopus. I paid only an average of 18p/kwh as a result
It's never renewable. Just a fact we convert wind to generation and coal but solar and wind is a very costly conversion nuclear is not and has life of 80 years or so unlike green generators of often 15 years with rocketing maintenance. Google Grid watch Templar for real time generating data.
I seem to recall Rishi Sunak promising to "look into" this pricing issue when the energy crisis started. As we all know, when politicians say this, it really means they will do nothing and hope we forget about it. Politicians have a track record of not working for the people - The Post Office and infected blood scandals to name but a few.
Even the renewables generators agree. This is why the government has a windfall tax on renewables, because they know it isn’t right. They take the money, but do we get it back? Not directly. Gas is the problem and how we are charged for every kWh as if it was made by gas. It’s a broken system.
To change that you put mass storage on strategic grid nodes. One such site was recently rejected by the council near me because it was deemed not necessary infrastructure and on green belt after 6 years in planning. The mass storage units are delivered in containers pre loaded you just hook them up and voila, insane really Each node would repay it's capital cost in under a year and stop us from using standby gas plant
How does the Octopus tariff work then when sometimes energy is free and related to the wholesale price of energy not the gas price, there is something missing in this video.
I had no idea about this and I suspect not many consumers do. It certainly explains why certain CEO’s of green energy companies are so vocal around government policies. Thank you Richard for opening my eyes.
Thank you Mrs Thatcher, she did so much damage to this country yet she had a state funeral whereas Nye Bevan who created the NHS was ignored by the state.
Time to move on. I think the UK energy market is a disgrace - but we have had plenty of red and blue governments since Thatcher. They all had the power to change the market and none have....
The energy system in this country is insane and I can't believe successive governments do nothing. I started really noticing it when centrica posted record profits recently. Annoyed by that I thought I'd switch to a company that only used renewables so won't use any excuse they can find to raise prices. So scottish power that, as they proclaim, all of their electricity is produced in the UK and is 100% renewable. Then I realised that this makes absolutely no difference to what I pay, but maybe I'll feel better that it's UK produced and 100% renewable. Thanks for this video, it's enlightened me but I think I'm even more annoyed now.
It is insane. The current Labour government is not doing ordinary voters any favours by allowing electricity prices to remain so high when they don't need to be.
Thanks for your clear and correct analysis of this enormous scam of consumers. I have been saying the same as you for many years - I worked briefly in the 1990s for a management consulting company which advocated marginal cost-based pricing rather than average cost-based pricing in the energy market. I said this was wrong at the time by using your argument, but I was over-ruled so I left that consulting company in disgust!
It's scandalous that's it done based on the highest price, instead of the average. Also thanks for mentioning Drax, another scandalous enterprise that i swear only Private Eye ever talks about, Drax is an absolute scam and needs to be shut down.
If you pay the average, renewables will start lying about their cost to increase their income. The marginal cost pricing is a mathematically sound system, you just need to get to the point where gas is not permanently necessary.
@@matejlieskovsky9625Most of our renewable generation is off shore wind and that is charged at a predetermined strike price when right to build and operate tye Wind Farm is made, this is made in return for the Government agreeing that all energy generated will be bought. In the early days of offshore wind this price was substantially higher than the marginal cost for Gas. But thanks to advances in wind technology and Russia's invasion of Ukraine it is now substantially less and this surplus is taken by the treasury, it is effectively a stealth tax.
*HERE IN BULGARIA I PAY £10.60* a month for my electricity - I dont have gas so that covers my heating, cooking and hot water. The commi bloc is very energy-efficient so I dont use much heating
You can look them up, the information is published ands freely available. You don't need any special skills, indeed no more than it has taken to ask the question. EON for example is a quoted German multinational. British Gas is owned by Centrica, quoted on the London Stock Exchange As is SSE, OVO is a private company backed by various Private Equity firms Octopus energy similar,
We’ve been on Octopus Agile for a few years. No solar or home battery, but both of us work from home, so we use proportionally more energy during the day than many other households. Our bills have increased gradually, but steadily since August and our most recent bill was 46% higher than in the summer. The only real increase to our usage is having lights on due to the shorter days, but every light in the house is a modern, efficient LED. No immersion heater. No electric shower. Something needs to change. £150/month for a 2 person occupancy is silly.
For those who want another look into how the price is calculated, look up Simon Clark, who have a vid called "How Britain broke its electrical grid (and how to fix it)".
Thatcher brought in a new era of mass unemployment from which we have never recovered. Her privatisation of the utilities resulted in huge bonuses for directors sewage in rivers and fuel poverty. Yet she is seen as a great stateswoman by some.
Scotland; surrounded by renewables on land and sea, hydro all over the place, highest charges in UK, lowest pension in Europe. Lowest temps in UK. Never mind...eye watering profits is actually what's being 'regulated'.
And don't we know that in Scotland...... Producing shed-loads of cheap electricity which is taken in increasing amounts to England then sold back to us at great cost. The Highlands pay the highest price in the uk. Take Pitlochry for example..... a small town that produces more than enough electricty for their needs with a hydro power station just half a mile way..... yet pay more than than London which produces next to nothing. And still more interconnectors are planned to syphon off even more of this cheap power. Grrrr!
Regulators are not fit for purpose now as they never hold the companies to account. as evidenced by the increase in Std Charges to protect margins, when gas prices fell! The channel is brilliant, keep it up, Richard
I would like to see Richard Murphy and Paul Collier be economic advisers to the Labour Government. Starmer and Reeves should implement the economic policies of Richard and Paul.
This is so frustrating for everyone, this country is full of people that comprehensively understand their own specialist area of knowledge. That are often ignored by our clueless politicians. Is The Lords the place where they should be? We have got to find a way to harness this knowledge for the benefit of the country. How do we do this? I suspect the only way is to insist all policies are evidence based and that a Law of unexpected consequences is enacted so that every unproven policy or new law is reviewed at an appropriate interval to reverse any damage that may have occurred.
The siutation witht he Drax powerstation is also scandalous. Drax receives £300million per year of state subsidy for their supposedly 'green' technology, while also paying shareholder £330million per year in dividends. Our tax is going straight into the pockets of the shareholders!
Thatcher also privatised council housing then water in 1989. Major implemented her plan to privatise the railways. That went well, but Blair doesn't escape responsibility because he continued the privatisation agenda.
From what I understand of the process, the suppliers don't have a big say in the way things are priced on the market. That's handled by the regulators who set up and manage the energy market. Even the cut of each unit of energy the sell is regulated to some maximum.
@@januszdelondres Honestly I haven't researched how the standing charge is handled. It is set by the company, but I'm not sure what it's intending to cover. I have seen some mention of the increases being used to cover the debt of bankrupted energy companies, but I'm not entirely sure how that's happening either..
I moved to Octopus for cheaper energy. I've been with them about a year, low and behold I'm paying about the same as I was with British Gas. Its all bull💩.
From what I've heard, there are plans to be announced in the coming months regarding a reform of the energy market. That's based on comments from an influencer who has apparently met with the PM. ua-cam.com/video/ZV27DiEuGls/v-deo.html
It might be worth explaining how the marginal price works: - There is an auction where the generators all bid for generating in an upcoming time period. - All the wind, solar, nuclear bid £0/MWh - The gas generators bid whatever - say £150/MWh - Everyone gets paid at the rate of the highest winning bid The generating companies know that if, for instance, the weather forecast is cold with no wind they can bump up their prices. They might be able to make even more money in the balancing market (too complicated to explain in a comment)
@@BrinJay-s4v Generally no as they have access to the weather forecast so won't bid. A lot of stuff operates on 30 minute settlement periods with the bid coming in 60 minutes before the period starts. They do, however, get paid to curtail when there is more energy being generated than the grid can carry away (boundary constraints). Happens a lot on the Scotland/England boundary as Scotland has far more wind energy than it can use.
Back in 2022, when the prices went sky high, the Conservative government promised to look at this Marginal Cost way of pricing and said they wanted to move away from using gas for setting electricity prices. The CEO of Octopus has gone on the record saying its madness that electricity is priced this way. Now we're in 2025 and still nothing has been done! The last lot in power (excuse the pun) had about 20 months from the time they suggested thjhgs should change, they did nothing. The current mob in office have inherited a broken nation (in more ways than one). I suspect that the energy price and marginal cost is their last priority......it shouldn't be, but I don't expect any change whatsoever!
While on the face of it, it seems an easy problem to solve, I would argue that we should allow the stakeholders time to make a case for how to improve the system. Still, the end result has to be that generators are not paid based on the cost of producing electricity using gas, but on either a market price or a Cost-Plus basis
"It's time for a change" 😅 I like what you did there, taking Starmer's constant refrain of "change" and throwing it straight back at him. Surely there are people in government who understand how this all works, but they don't care OR they are using the overpayment from all of us to incentives more solar/wind production?
This is why there is a mad dash for Solar Power Stations - the returns (profitability) will be fantastic - and the vast bulk will go offshore thus avoiding paying tax..
You only have to look at the dividends paid by solar and wind energy companies to see how profitable these companies are with the current model. This has to change.
Obviously, it would be far better for this to be public investment. We do however need this "mad rush", it would just be better for the taxpayer to fund the power stations. It is also worth noting that renewable companies have faced a windfall tax, and unlike the fossil fuel companies, the renewables actually have to pay their windfall tax, rather than mitigating it by spending the money on "research".
I'm adding more PV because it pays , none of the profits go off shore just to me , I get 2X + winter fuel payments worth as it is. That's without subsidies , its a no brainer .
@@waynecartwright-js8tw Indeed, this microgeneration is becoming an increasingly important part of the electricity supply, especially when coupled with batteries.
Octopus just raised my energy bill by 1% in January,surely they could have absorbed this very small increase because the rise in wholesale price increase must have been minimal,we’re having the piss taken out of us. My direct debit for fuel has gone up from £46-00 pounds a month to £140-00 pounds a month,it’s no wonder these fuel companies make such huge profits it’s a disgrace how we’re being ripped off and Starmer and Co found it necessary to stop our winter fuel allowance yet are still able to claim theirs.
Yanis Varoufakis wrote about this a few Years back after Russia invaded Ukraine, the cost of LNG went to the Moon at that time and companies supplying green electricity experienced profits that were absurd. As we are now out of the EU the Government could create their own legislation and apply a small margin to each form of electricity created.
@@adam7802 I'd go running back to the EU if they harmonised corporation taxes and didn't impose fiscal rules that made the EU irrelevant in global terms by 2050, maybe sooner.
Dear Rich, You are absolutely correct in calling out bad Government. At the macro level the importance and difficulties of tax design are dramatically illustrated by comparing Britain and Norway..... "How Norway beat Britain" The tax revenues collected per barrel have averaged $33 for Norway but only $11 for Britain. (Ref page 183 "Left Behind" by Paul Collier).
I have no doubt that lobby groups from the 6 main energy wholesale companies in the UK have been VERY hard at work to ensure that: a) The government don' t introduce a Windfall Tax on excess profits b) The Regulator (OffWat) CONTINUES to calculate energy costs as they do now, and c) The government don't employ any advisers - such as Professor Richard Murphy - who might 'rock the boat.' I also STRONGLY suspect that Labour want to continue with the same policies as the Tories wherever possible - probably because bribes are being paid to Cabinet Ministers (very discretely, of course) on the strict understanding that the government will NOT in any way attempt to minimize the profits of these giant campanies. Such bribes often take the form of Ministers being invited to sit on the Boards of such companies for considerable fiscal benefit in return for minimal work - a nice little nest-egg both for the immediate future and for their retirement.
Historically the problem has been not that government departments did not have scientific and/or other expert advisers, but that they have chosen to ignore them for political or other short-term reasons. It is in the nature of the beast!
Well done for not mixing up energy with electricity. I have heard politicians do this and I despair as decarbonising electricity is far easier than decarbonising energy as energy of course includes heat which may be from gas or oil boilers, and fossil fuels burnt in industry, and kinetic energy i.e., which will mainly be from petrol and diesel vehicles at the moment.
Please could you analyse the Water Industry in the same way. I don’t understand why the regulator says my bills have to rise so much when I thought I was paying for waste water to be removed and properly treated already. I suppose this might be an unpleasant and sickening thing to do. ?
I recall the last barrage of complaint against the water companies 12-15 years or so ago when they said to fix the leaks and antiquated sewerage systems they would have to put the price up, and so they did. Here we are again we are still suffering from leaks and an antiquated sewerage system, so they are going to put the prices up. All this time they have been sending dividends to overseas investors and have failed to improve the infrastructure. Fool me once, shame on you. Fool me twice, shame on me.
Two points worth considering. During this time period the energy companies have reported massive increases in profits to which Treasury has applied a hopeless windfall tax. The Treasury charge a consumer tax as % of consumer price. It does seem the Treasury is using this increase as a major source of raising revenue to fill the gap caused by low corporation taxes and avoidance
Pure greed is the issue here, and most of our problems stem from it. The concentration of wealth and the protection of it shows that. A small amount of society has more wealth than they could spend in numerous lifetimes, but still want more and more. Yet so many struggle to afford some heating and basic living costs. Surely, it's time to do something different for the good of the majority, rather than the minority of the super-rich and privileged.
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@@amleth_prince_of_denmark I agree there is a market but what is the price difference between the different suppliers? Very very little, so that is price fixing, and what you’d expect a Cartel to offer. Where do they buy wholesale energy? It’s a cartel and a scam, but there is nothing you can do about it. Well you could go off grid fully solar and get them to remove the meter(s)
We also got told we were bailing out bust companies. How long are we bailing them out for? Surely we've paid billions extra by now. Things go up with every excuse but never come down
They are looking at this though, as well as regional pricing. Reports should be out halfway through the year. Hopefully it'll lead to the right decision and lower prices
Reports out in summer, when many folks will be in debt to the energy companies for extortionate bills just to stay warm, or even just keep the lights on, and to cook. Who is doing the reports, and how much are they being paid to do the 'reports'? It can't be rocket science, can it?
I know the answer to your question. Ofgem does understand the reasons why marginal pricing of electricity onto the system hold prices high, but having constructed the whole mechanism themselves under their NETA and BETA market developments decades ago feel unable to scrap them today. Couple this with their price cap ( which effectively tells suppliers what tariff prices will be) for energy coming off the system and it is a market so hamstrung and inefficient it defies any logic. The icing on the cake was Ofgem driving through their ‘connect and manage’ which allowed generators to connect even though the network was inadequate to accept their output. For times of restriction (called constraints) they get paid handsomely for being switched down or off. Utter madness, but the big companies are making oodles so don’t care! All the industry policy makers dare not resolve as they need the wealthy businesses to invest to meet net zero promises. In this respect it is corrupt. Regard it as another tax, as government does and it works!
Very interesting, thank you for the video. If we try to reduce the price we pay the producers like nuclear power plants (which require a massive investment cost up front), do we risk these operators not invest in the UK ans go elsewhere? We have to remember the funding crisis at Hinckley C etc between the French and Chinese. I think the UK is not paying for the building of those plants?
Another informative video. Thank you Richard. I’m not sure if I understand that there isn’t a marginal cost for electricity suppliers. Those power plants will have to have been built through investments first, which for nuclear plants could be in the billions. I think this is what we are paying for. The question is, once paid off, including the interest paid, how much does it cost to maintain and perhaps upgrade those power plants in the future. So there is an ongoing cost and one would think that regulators would ensure we get the best bang for our buck.
Thank you I really enjoyed the video. It's clear in the UK that we identify the blatant profiteering of some but the problem isn't solved there. Where we seem to fail is by not having a mechanism for change. These issues are ignored by the MSM and we have no obvious redress. People are really suffering and their suffering becomes a source of profit for the already wealthy. Why do we tolerate this!!!!
Prices need to recover the investment costs and operating costs plus some profit. The way the market operates was set up before wind and solar and needs to be revised/restructured. But for the time being the government benefits from supertax on the green generators and has no incentive to change the system. As you say this scam needs to be called out. The Government is knowingly keeping prices high and blaming the generators. They think we are stupid and don't see it. Cheers
Been saying something to this effect for years. Luckily I’m pretty frugal and my energy costs £900 a year. I am in the process of disconnecting from gas entirely over the next few years, and will probably switch to one of the new tariffs available soon which gets rid of daily standing charge but with a slightly higher unit charge. Thinking about a home battery to shift energy usage around as well.
Serious question: if gas is more expensive and it's cost sets the costs for all sources, why are wind energy companies saying that they can't operate under current income and want to charge more?
Fully, completely and totally agree that it's POLITICAL! If our governments were on our side we would be buying Russian energy at a small fraction of what we are paying. Instead, our prices are decided in Washington!
@@chrispenn715 The Russian propaganda said it turned it off but it was the German govt itself that stopped importing. Then the Nord stream was sabotaged preventing any possible future deliveries apart from other long existant land lines. So instead of being dependant on russian gas, Germany is now dependent on US American and Norwegian suppliers.
It is incentive to invest into renewables until gas is phased out entirely. Many energy companies reinvest profits into building more solar/wind. If scheme is removed who will pay for it?
Domestic supply companies are different from the energy producers. Gas etc is bought on the open market as we dont have enough supply for the country, so we pay open market prices. The wholesale price of electricity is based on a price as cleared auction daily. Although this seems an expensive way to do it, most research shows that a price as bid auction would produce similar prices and would have a higher carbon footprint.
Marginal Costs - Wind Solar Nuclear would have ongoing payments from loans for Installation. And any smart company would also re-invset for replacements e.g. save up to replace solar panels when their lifespan declines. But I still agree that our Energy Prices are far too high.
@RichardJMurphy - thanks for making your videos, they are always enlightening. You describe how all suppliers to the electricity market are paid at the marginal cost of the most expensive one. Is this the case for suppliers that are paid using the CFD model too?
3:50 It’s hard to understand how DRAX burning imported wood chips, which emit more pollution than coal, can be considered environmentally friendly. These wood chips are shipped from North America on fossil fuel-powered vessels, contributing further emissions, and their production involves deforesting carbon-absorbing trees. How can this process, which seemingly exacerbates environmental damage, be labeled as "zero carbon"? It seems more logical to question whether this is genuinely better for the planet than burning fossil fuels directly.
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If I may ask, how do you manage to earn so much? What are your strategies?
Diving into the digital market is definitely advisable, but it requires expert guidance, and with Ms. Sophie Rogerz, you can’t go wrong.
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Sophie Rogerz? I was introduced to her by a friend. My husband and I have been working with her for months, and it was through her profits that we were able to grow in the real estate market.
I keep hearing a lot about Ms. Sophie; she must be really good.
The politicians know this is going on. It's just another case of knowingly allowing the rich to get richer while the poor get poorer.
Internet Archive - 1879 letter from Baruch Levy to Karl Marx .."Jews will attain world domination by the dissolution (ending) of other races,Thus will the promise of the Talmud be fulfilled, in which it is said that when the messianic time is come, Jews will have all the property of the whole world in their hands"
Always the same....
What is the point of a regulator when they seem to kow-tow to the rapacious energy companies?? Whenever the cap is raised the energy companies take advantage of it to price gouge. How long must we tolerate this for?? It's a disgrace. 🤬
They are doing what they are told prices must go up for net zero. Funny they dont follow that rule for immigration.
Because these companies are powerful. Don't forget that they give a lot of money to the government. Wonder just how powerful they are? They wrote the legislation for preventing protest and demanded 10 yrs imprisonment for oil protestors. You and I have only one vote each but these gas companies have the direct dial numbers of the relevant minister(s). On top of that people blame the regulators who are gagged and de-funded.
1 month of wage for energy, 1 month of wage for council tax and bill.
Mortgage , transport food. There is no disposable income for single people.
@@marumaru6084 It goes up because of the price of GAS if we had a net zero grid then you wouldn't get the price changes due to enough mass storage on the system to use and store all the always on power
What Richard outlines here is just the tip of a deeply murky iceberg. You might think that Ofgem are there to represent the consumer, but actually their main mission is to ensure that the market is profitable - otherwise the generators pack up and the lights go out. There is a review into pricing going on at the moment, but don't expect anything dramatic.
In Orkney and Shetland, we pay roughly double the UK price cap for electric, and the UK price cap is roughly double (according to recent reports) to what folk pay in France for their electric. So if you take the current UK cap and pay for 5 years worth of electric in Orkney and Shetland. The amount spent would be able to pay for 20 years worth of electric in France!!!
And ALL the electric used in Orkney is produced by renewables based in Orkney too!!! Putting prices up again, is nothing more than a PISS TAKE!!!
Also you live where it is colder and darker in winter. It’s all a state sponsored rip off.
You pay the national grid price set by the regulator.
I have a solar battery system due to the abundance of renewable s with just batteries you should be able to save the capital cost in under 5 years.
Wind is always on and it costs to turn the turbines off so in England we can get as cheap a rate as 7p down from 24p for overnight use.
A 10kwh system should cost around 3k my annual energy bill used to be 2.5k
@@SlowhandGreg But why should they pay the cost of burning gas, when they don’t do that. Indeed Scotland as a whole generates only a tiny amount of its electricity from a gas powered station at Peterhead.
Ironically the largest electricity generation company in the UK is owned by the French ( EDF ) who use _us_ to subsidise _their_ energy cost.
Go figure eh.
Ironical our biggest electricity generator is own by the French ( EDF ) who use _us_ to subsidise _their_ energy costs.
Go figure eh.
Martin Lewis declared, at least a year ago, that "the market is broken". We also find that regulation is a joke and no politician is brave enough to nationalise supply. Politicians work for corporate interets and NOT for the people.
How exactly do you nationlise our energy supply, how much would that cost?
It's not about being brave it's about reality.
@billB101 They stole it all from us in the first place. We should take it back. The great British public were hoodwinked into buying shares in something they already had a share in. "Don't forget to tell Sid".
@@billB101 Handily this channel did a great explanation of that using the water companies as an example.
@@billB101 ua-cam.com/video/TlVbKVBLOiM/v-deo.html
@@Neokretai I watched that a while back and honestly I think it's nonsense when compared to energy, the bill for buying back our energy from companies like EDF would be absolutely enormous if indeed they wanted to sell in the first place (and why would they _we're_ literally picking up the tab for _their_ energy subsidies ) This not post WW2, there's not the sentiment for this. And then there's the blowback if it fails and our economy tanks. Saying it is one thing, doing it is entirely different.
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One word,CORRUPTION.
While the state electricity company in China.Giving discounts to rural people.Those who want to use an electric car.
@@adenwellsmith6908 State electricity company. State-owned company. State-owned company
Very true. Chicago being once renowned for being the centre of organised crime is known for its brand of a seemingly criminal brand of economics via the Chicago School of Economics; that of Neoliberalism. A clearly open route to syphoning off profits and socialising losses under the nose of governments who retain no powers to control the blatant multiple levels of criminality from Hollywood and other types of false accounting to ripping customers off in numerous ways; e.g. overcharging for goods and services or not providing the services they are paying for etc. Boeing is a clear case in point. Provided with $ billions of hand outs by the US Government while building shoddy products and paying out massive share dividends and large bonuses to the CEO etc. US Health insurers are now more prominently in the frame for putting profits before providing what their customers actually pay them for. It's about time this house of cards collapsed.
Except that Richard didn't mention that solar and wind power plants pretty much all operate under a 'contract for difference' at a much lower price. The government keeps most of the 'massive profits' that he mentioned. It's more of a stealth tax.
Two words: CLASS WAR
I wonder which politicians got a bung to agree to the way we price electricity?
Well it was put in place many decades ago when it made sense. It hasn’t made sense to charge that way for several years now, but no government so far has addressed the issue.
Oddly Mr Putins actions have brought the matter to a wider public attention, so more and more people have looked into it and found out how it really works. The more we know, the more we raise it, the better chance we have of getting it fixed.
It was probably reasonable at the time it was originally done, but the world has changed, and the pricing formula has not been adjusted as it ought to have been. Because politicians, our politicians by and large anyway, are not detail focused people and are not good at asking detailed technical questions either.
At that time the system was set gas was the biggest energy source i think . So it sort of made sense, well it didnt really. Now it makes no sense and desperately needs reform.
This is a belief system and therefore it is its own reward.
It is austerity under the guise of a "market mechanism". And as we know from Clara Mattei austerity is deliberate and murderous class war.
And we should know by now that class war is the mysterious missing "vision"/policy agenda of Starmer and the British regime
@@oscartrain1151 Just pointing out that both the system and high prices were the same under the previous administration. This is a government failure issue across the board across all parties and not restricted to a Labour one. Will they fix it now they are in charge or allow it to continue? I have no idea. They will be judged by their actions (or lack of).
That's what I love about this channel. Richard clearly explains how things aren't as we'd been led to believe.
Interesting. I thought much of this was public knowledge by now. I've seen many much larger channels cover this in the past.
I thought it was a terrible explanation cuz, I don’t know about you, but I pay a DIFFERENT price for gas and electricity ?!? 🤔
@@HickalumRichard was talking about electricity pricing.
@@Hickalum That's not really what the video was about though. It's a weird complaint to have.
People should be very angry about a lot of things.lnstead the hard of thinking get very angry about what the right wing media feed them.they are very angry about benifits fraud because the daily hate mail are forever telling them to be so.however the daily hate mail says nothing about tax fraud which is a much bigger problem.l wonder is that they are owned by foreign overseas billionaires.when the investigation into off shore tax havens was revealed it was in some papers for barely a day and I'm sure the daily hate and the daily gammon express found another story to cover.billionaires sucking out wealth from this country should be the source of anger but instead it's stop the boats that gets all the attention .
Y
And no mention of the despicable standing charges for the "infrastructure" that seemingly has to rise at the same percentage as the energy.
Part of the standing charges are to pay people like me for the solar energy that I produce- and they use mostly myself. For 25 years. Thank you for your contribution.
Yes let’s remind viewers we are still living under Thatcherism for nearly 50 years now
Psst, she’s dead , child…..we now have a bloke called Starmer in charge. That’s right, the bloke who now ‘run’s’ the country. He promised that energy prices would go down…….😂😂😂
And god knows we're at the arse end of it now
She wouldn't have put up with the shit we have to deal with nowadays ( oh, and she hasn't been in power for over 30 years so, you know, time to move on maybe)
46 years to be exact!
We are doomed!😔
they sold the family silver to the foreigners.. and now we have to rent it back
This government ( based on their performance so far ) are terrified of upsetting the treasury/markets / big business and , in doing so , are annoying all the people that they promised to help
they are not terrified of upsetting the treasury/markets/businesses. They are terrified of upsetting rulling elites and wef who pays them big checks
Also the Tory government.
@@sebastianw7348- Tory or Labour. The King. All WEF stooges. All traitors to the UK
Many of the executives at the regulatory body will go on to get jobs in these energy companies! Is this a shock? Greed, corruption & political incompetence.
I can't even read the new bills. They say you're in credit by X in 5 different places. 5 different breakdowns.
They are deliberately convoluted.
Another ludicrous situation is that Scotland the one part of the UK that produces more electricity than it uses(mostly from renewable sources)and in fact exports a sizeable amount of that production to England has by far the most expensive electricity prices in Europe and this is entirely down to Westminster policy and dogma
This is yet another reason why we need Scottish independence. I agree - the energy price situation for Scotland is highly iniquitous.
What was the cost of the renewables? Who paid for it?
@@stanleyshannon4408 The companies paid for it with investment by the Scottish government as well as the EU(before England had a brain fart and forced the UK out of the EU). however the amount of money the electricity costs is set by Westminster according to the price of electricity generated from gas which is the most expensive way to generate electricity; the so called"green levy"on renewables is actually there so that it does not become obvious how much cheaper than gas renewables are. The transport levy for electricity through the laughingly named national grid is also set by Westminster and heavily favours electricity generation in England and penalises electricity use in Scotland which is daft as by far the most capacity for generation is in Scotland
@@davidmcintyre8145the distribution costs in Scotland are more per head because Scotland has a sparse spread out population except for the central belt.
@@waltermcphee3787 The fact that the national grid in Scotland has not been updated in 70 years and cannot cope with the power already generated never mind the potential shows what the English government thinks of Scotland. By the way you asked who paid for the renewables and that I answered. Now i ask who spaffed all the taxes earned from the electricity companies just as they spaffed the taxes from the oil companies to donors,family members,vanity projects like the Dome and mistresses rather than keep prices down like they did in Europe over the last few years? It was the Westminster parliament and of course retired Westminster ministers often sit on the boards(paid but not doing any work)of the energy companies. There is also the fact that until the clearances both Highland and Lowland by the landlords looking for more money(shades of the modern BTL system)the Highlands actually had a larger population than the Lowlands. Perhaps that is London's worry; that the South east of England which as we know from environmental data will become all but inhabitable due to lack of potable water within 30 years will be overtaken by the Highlands of Scotland(an area they have hitherto seen as mere backward colonial savages)as the nexus of the UK or what remains of it economy or that it would give the Scots an economic impetus that cannot be gainsaid to leave the UK and join the EU(meanwhile leaving England ever more dependant on imports of food,oil,gas,electricity and most important workers)
I'm all electric and my energy company claims all my energy is renewable, I can see the wind turbines yet I'm paying the price for gas!
renewable energy is a BS to supply the whole country. a country with no sun no solar panels. Renewables always fail, and this is their plan to freeze you
Renewable energy tariffs are a myth and always were. You can't separate the electrons
@edwardlsanders shouldn't be allowed to sell them
I agree the terminology is mad. It's the system which they thought could stimulate renewables 20 years ago.
If you want to save money, get a smart tariff from, say, octopus. I paid only an average of 18p/kwh as a result
It's never renewable. Just a fact we convert wind to generation and coal but solar and wind is a very costly conversion nuclear is not and has life of 80 years or so unlike green generators of often 15 years with rocketing maintenance. Google Grid watch Templar for real time generating data.
I seem to recall Rishi Sunak promising to "look into" this pricing issue when the energy crisis started. As we all know, when politicians say this, it really means they will do nothing and hope we forget about it. Politicians have a track record of not working for the people - The Post Office and infected blood scandals to name but a few.
That's because after a century of open voting we *_still_* haven't learnt how to vote!
Vote for an A-hole, get an A-hole!
When the electricity is generated by renewables, it should not be priced to the wholesale gas price.
Even the renewables generators agree.
This is why the government has a windfall tax on renewables, because they know it isn’t right. They take the money, but do we get it back? Not directly.
Gas is the problem and how we are charged for every kWh as if it was made by gas. It’s a broken system.
To change that you put mass storage on strategic grid nodes.
One such site was recently rejected by the council near me because it was deemed not necessary infrastructure and on green belt after 6 years in planning.
The mass storage units are delivered in containers pre loaded you just hook them up and voila, insane really
Each node would repay it's capital cost in under a year and stop us from using standby gas plant
@@SlowhandGreg What kind of mass storage?
It's not rocket science is it? So what's stopping successive governments? Is left or right just an illusion of choice?
How does the Octopus tariff work then when sometimes energy is free and related to the wholesale price of energy not the gas price, there is something missing in this video.
I had no idea about this and I suspect not many consumers do. It certainly explains why certain CEO’s of green energy companies are so vocal around government policies. Thank you Richard for opening my eyes.
Just back from Spain. Now I know not everything is equal, the price is HALF what it is here
Not a lot of people know that.
Yes and in years gone by it was even cheaper to live there.
How much of that was from renewable?
@stanleyshannon4408 not sure. As I said, not all equal. But they have many wind turbines and solar farm's
is that per Kwh and how much for standing/transport costs.
Richard you should write a petition on this, I would certainly be signing that
Thank you Mrs Thatcher, she did so much damage to this country yet she had a state funeral whereas Nye Bevan who created the NHS was ignored by the state.
She and Reagan both.
She's not listening.
Time to move on. I think the UK energy market is a disgrace - but we have had plenty of red and blue governments since Thatcher. They all had the power to change the market and none have....
The coal is still there. Maggie was saving it for us.
Broken record. Focus on the present not the past.
The energy system in this country is insane and I can't believe successive governments do nothing. I started really noticing it when centrica posted record profits recently. Annoyed by that I thought I'd switch to a company that only used renewables so won't use any excuse they can find to raise prices. So scottish power that, as they proclaim, all of their electricity is produced in the UK and is 100% renewable. Then I realised that this makes absolutely no difference to what I pay, but maybe I'll feel better that it's UK produced and 100% renewable. Thanks for this video, it's enlightened me but I think I'm even more annoyed now.
It is insane. The current Labour government is not doing ordinary voters any favours by allowing electricity prices to remain so high when they don't need to be.
@@tlangdon12vote for A-holes, get A-holes 😢
Greed not Need
Thanks for your clear and correct analysis of this enormous scam of consumers. I have been saying the same as you for many years - I worked briefly in the 1990s for a management consulting company which advocated marginal cost-based pricing rather than average cost-based pricing in the energy market. I said this was wrong at the time by using your argument, but I was over-ruled so I left that consulting company in disgust!
It's scandalous that's it done based on the highest price, instead of the average. Also thanks for mentioning Drax, another scandalous enterprise that i swear only Private Eye ever talks about, Drax is an absolute scam and needs to be shut down.
If you pay the average, renewables will start lying about their cost to increase their income. The marginal cost pricing is a mathematically sound system, you just need to get to the point where gas is not permanently necessary.
Wood pellets imported from Canada. A disaster for the environment.
@@matejlieskovsky9625Most of our renewable generation is off shore wind and that is charged at a predetermined strike price when right to build and operate tye Wind Farm is made, this is made in return for the Government agreeing that all energy generated will be bought. In the early days of offshore wind this price was substantially higher than the marginal cost for Gas. But thanks to advances in wind technology and Russia's invasion of Ukraine it is now substantially less and this surplus is taken by the treasury, it is effectively a stealth tax.
How do you control a population? Food, energy and housing.
Invest in N. Korean ideology.
@@AnotherPointOfView944 We are getting there.
Apart from immigration, causing a greater demand for houses, electricity and gas.
*HERE IN BULGARIA I PAY £10.60* a month for my electricity - I dont have gas so that covers my heating, cooking and hot water.
The commi bloc is very energy-efficient so I dont use much heating
For sure 100% pity we couldn't have a list of shareholders in these companies ,
You can look them up, the information is published ands freely available. You don't need any special skills, indeed no more than it has taken to ask the question.
EON for example is a quoted German multinational. British Gas is owned by Centrica, quoted on the London Stock Exchange As is SSE, OVO is a private company backed by various Private Equity firms Octopus energy similar,
@@rupertmiller4718Great obfuscation! The issue isn’t with the retailers of electricity, but with the producers.
If you have a pension then you _are_ one of the shareholders.
We’ve been on Octopus Agile for a few years. No solar or home battery, but both of us work from home, so we use proportionally more energy during the day than many other households.
Our bills have increased gradually, but steadily since August and our most recent bill was 46% higher than in the summer.
The only real increase to our usage is having lights on due to the shorter days, but every light in the house is a modern, efficient LED.
No immersion heater. No electric shower.
Something needs to change. £150/month for a 2 person occupancy is silly.
Check your usage
For those who want another look into how the price is calculated, look up Simon Clark, who have a vid called "How Britain broke its electrical grid (and how to fix it)".
And Prof Euan McTurk on his Plug Life Television UA-cam channel
Euan McTurk explained how bills could be lowered at absolutely NO COST to the taxpayer.
ua-cam.com/video/ig-_WRd8GC0/v-deo.htmlfeature=shared
Google Gridwatch Templar for data on real time generation and demand UK and France only.
A price cap is not what you imagine it is. It goes up every 3 months.
Thatcher brought in a new era of mass unemployment from which we have never recovered. Her privatisation of the utilities resulted in huge bonuses for directors sewage in rivers and fuel poverty. Yet she is seen as a great stateswoman by some.
Scotland; surrounded by renewables on land and sea, hydro all over the place, highest charges in UK, lowest pension in Europe. Lowest temps in UK. Never mind...eye watering profits is actually what's being 'regulated'.
Thank you for the clear and concise explanation.
And don't we know that in Scotland...... Producing shed-loads of cheap electricity which is taken in increasing amounts to England then sold back to us at great cost. The Highlands pay the highest price in the uk.
Take Pitlochry for example..... a small town that produces more than enough electricty for their needs with a hydro power station just half a mile way..... yet pay more than than London which produces next to nothing.
And still more interconnectors are planned to syphon off even more of this cheap power. Grrrr!
Scotland's own fault they voted "No" in 2014, could all have been very different, perhaps Scot's are all stupid???
Regulators are not fit for purpose now as they never hold the companies to account. as evidenced by the increase in Std Charges to protect margins, when gas prices fell! The channel is brilliant, keep it up, Richard
The regulators are themselves regulated by politicians.
I would like to see Richard Murphy and Paul Collier be economic advisers to the Labour Government.
Starmer and Reeves should implement the economic policies of Richard and Paul.
See "Left Behind" new book by Professor Paul Collier. I believe the book adds to the information provided by Professor Richard Murphy
This is so frustrating for everyone, this country is full of people that comprehensively understand their own specialist area of knowledge. That are often ignored by our clueless politicians. Is The Lords the place where they should be? We have got to find a way to harness this knowledge for the benefit of the country. How do we do this? I suspect the only way is to insist all policies are evidence based and that a Law of unexpected consequences is enacted so that every unproven policy or new law is reviewed at an appropriate interval to reverse any damage that may have occurred.
The siutation witht he Drax powerstation is also scandalous. Drax receives £300million per year of state subsidy for their supposedly 'green' technology, while also paying shareholder £330million per year in dividends. Our tax is going straight into the pockets of the shareholders!
Energy prices still massively in favour for those with gas heating, even when purchasing 100% renewable electricity!
Especially with green generation its the most expensive not cheapest.
Best simple explanation of the stupidity of our alleged energy free market I have seen anywhere. Well done!
Thank you for another brilliant video Richard J Murphy
Thanks for this, the first time I've understood the gas link to electricity prices
Thatcher also privatised council housing then water in 1989. Major implemented her plan to privatise the railways. That went well, but Blair doesn't escape responsibility because he continued the privatisation agenda.
It's been the same since and will not change without mass movement. Those on the gravy train won't be coming off easily.
30 years ago we never worried about energy bills like we do now, it was never an issue
When the Electricity suppliers started selling you gas cheaper than the Gas suppliers, you really should've realised that something was very wrong.
my energy "supplier" is octopus which claims to be different from the other "suppliers" it still price gouges like the rest.
From what I understand of the process, the suppliers don't have a big say in the way things are priced on the market. That's handled by the regulators who set up and manage the energy market.
Even the cut of each unit of energy the sell is regulated to some maximum.
@whosdr , they still collect the standing charge, just under£0.70 per day, over £250.00 per year, this is octopus's choice.
@@januszdelondres Honestly I haven't researched how the standing charge is handled.
It is set by the company, but I'm not sure what it's intending to cover. I have seen some mention of the increases being used to cover the debt of bankrupted energy companies, but I'm not entirely sure how that's happening either..
I moved to Octopus for cheaper energy. I've been with them about a year, low and behold I'm paying about the same as I was with British Gas. Its all bull💩.
What tariff are you on ? I am on intelligent go with them and its very reasonable
Time for a petition on these prices, NO MORE RIPP OFF PROCES.
Energy needs long term planning and investment.
Three years ago my monthly bill was £59. Now its £170. Didn't Labour promise to lower energy bills?
Ah but that was before the election.
Plus the UK parliamentary system, regardless of party, has been captured by the corporate class
From what I've heard, there are plans to be announced in the coming months regarding a reform of the energy market.
That's based on comments from an influencer who has apparently met with the PM.
ua-cam.com/video/ZV27DiEuGls/v-deo.html
Gee mine is only half that in Australia.
I currently pay £25 - 30/month for a two bed flat incl cooking, heating and other appliances. All elec, no gas.
It might be worth explaining how the marginal price works:
- There is an auction where the generators all bid for generating in an upcoming time period.
- All the wind, solar, nuclear bid £0/MWh
- The gas generators bid whatever - say £150/MWh
- Everyone gets paid at the rate of the highest winning bid
The generating companies know that if, for instance, the weather forecast is cold with no wind they can bump up their prices. They might be able to make even more money in the balancing market (too complicated to explain in a comment)
Do wind pay penalties in windless times I wonder? They contracted to supply.
@@BrinJay-s4v Generally no as they have access to the weather forecast so won't bid. A lot of stuff operates on 30 minute settlement periods with the bid coming in 60 minutes before the period starts. They do, however, get paid to curtail when there is more energy being generated than the grid can carry away (boundary constraints). Happens a lot on the Scotland/England boundary as Scotland has far more wind energy than it can use.
Back in 2022, when the prices went sky high, the Conservative government promised to look at this Marginal Cost way of pricing and said they wanted to move away from using gas for setting electricity prices. The CEO of Octopus has gone on the record saying its madness that electricity is priced this way.
Now we're in 2025 and still nothing has been done! The last lot in power (excuse the pun) had about 20 months from the time they suggested thjhgs should change, they did nothing. The current mob in office have inherited a broken nation (in more ways than one). I suspect that the energy price and marginal cost is their last priority......it shouldn't be, but I don't expect any change whatsoever!
While on the face of it, it seems an easy problem to solve, I would argue that we should allow the stakeholders time to make a case for how to improve the system. Still, the end result has to be that generators are not paid based on the cost of producing electricity using gas, but on either a market price or a Cost-Plus basis
Thanks for the video Richard, keep exposing these things to the world
Nearly on 100k subscribers
People need to be aware of these things
"It's time for a change" 😅 I like what you did there, taking Starmer's constant refrain of "change" and throwing it straight back at him.
Surely there are people in government who understand how this all works, but they don't care OR they are using the overpayment from all of us to incentives more solar/wind production?
This is why there is a mad dash for Solar Power Stations - the returns (profitability) will be fantastic - and the vast bulk will go offshore thus avoiding paying tax..
You only have to look at the dividends paid by solar and wind energy companies to see how profitable these companies are with the current model. This has to change.
Obviously, it would be far better for this to be public investment. We do however need this "mad rush", it would just be better for the taxpayer to fund the power stations.
It is also worth noting that renewable companies have faced a windfall tax, and unlike the fossil fuel companies, the renewables actually have to pay their windfall tax, rather than mitigating it by spending the money on "research".
I'm adding more PV because it pays , none of the profits go off shore just to me , I get 2X + winter fuel payments worth as it is. That's without subsidies , its a no brainer .
@@waynecartwright-js8tw Indeed, this microgeneration is becoming an increasingly important part of the electricity supply, especially when coupled with batteries.
Octopus just raised my energy bill by 1% in January,surely they could have absorbed this very small increase because the rise in wholesale price increase must have been minimal,we’re having the piss taken out of us. My direct debit for fuel has gone up from £46-00 pounds a month to £140-00 pounds a month,it’s no wonder these fuel companies make such huge profits it’s a disgrace how we’re being ripped off and Starmer and Co found it necessary to stop our winter fuel allowance yet are still able to claim theirs.
Yanis Varoufakis wrote about this a few Years back after Russia invaded Ukraine, the cost of LNG went to the Moon at that time and companies supplying green electricity experienced profits that were absurd. As we are now out of the EU the Government could create their own legislation and apply a small margin to each form of electricity created.
They could, but the government don't want to seperate from the EU... They want to get back with them let's be realistic.
@@adam7802 I'd go running back to the EU if they harmonised corporation taxes and didn't impose fiscal rules that made the EU irrelevant in global terms by 2050, maybe sooner.
Dear Rich, You are absolutely correct in calling out bad Government.
At the macro level the importance and difficulties of tax design are dramatically illustrated by comparing Britain and Norway..... "How Norway beat Britain" The tax revenues collected per barrel have averaged $33 for Norway but only $11 for Britain. (Ref page 183 "Left Behind" by Paul Collier).
The regulator is a sham.
As are successive governments.
Not only Martin Lewis but private eye have been on about this for decades. Good vid keep it up.
I have no doubt that lobby groups from the 6 main energy wholesale companies in the UK have been VERY hard at work to ensure that:
a) The government don' t introduce a Windfall Tax on excess profits
b) The Regulator (OffWat) CONTINUES to calculate energy costs as they do now, and
c) The government don't employ any advisers - such as Professor Richard Murphy - who might 'rock the boat.'
I also STRONGLY suspect that Labour want to continue with the same policies as the Tories wherever possible - probably because bribes are being paid to Cabinet Ministers (very discretely, of course) on the strict understanding that the government will NOT in any way attempt to minimize the profits of these giant campanies.
Such bribes often take the form of Ministers being invited to sit on the Boards of such companies for considerable fiscal benefit in return for minimal work - a nice little nest-egg both for the immediate future and for their retirement.
Historically the problem has been not that government departments did not have scientific and/or other expert advisers, but that they have chosen to ignore them for political or other short-term reasons. It is in the nature of the beast!
Well done for not mixing up energy with electricity. I have heard politicians do this and I despair as decarbonising electricity is far easier than decarbonising energy as energy of course includes heat which may be from gas or oil boilers, and fossil fuels burnt in industry, and kinetic energy i.e., which will mainly be from petrol and diesel vehicles at the moment.
Energy prices in the UK are mad, 2022 I paid £200 in Malaysia and last year £1800 and no AC here.
Please could you analyse the Water Industry in the same way. I don’t understand why the regulator says my bills have to rise so much when I thought I was paying for waste water to be removed and properly treated already. I suppose this might be an unpleasant and sickening thing to do. ?
I recall the last barrage of complaint against the water companies 12-15 years or so ago when they said to fix the leaks and antiquated sewerage systems they would have to put the price up, and so they did. Here we are again we are still suffering from leaks and an antiquated sewerage system, so they are going to put the prices up. All this time they have been sending dividends to overseas investors and have failed to improve the infrastructure. Fool me once, shame on you. Fool me twice, shame on me.
Why can't we, the people, bring private prosecutions against these scam fraudsters?
Two points worth considering. During this time period the energy companies have reported massive increases in profits to which Treasury has applied a hopeless windfall tax. The Treasury charge a consumer tax as % of consumer price. It does seem the Treasury is using this increase as a major source of raising revenue to fill the gap caused by low corporation taxes and avoidance
Pure greed is the issue here, and most of our problems stem from it. The concentration of wealth and the protection of it shows that. A small amount of society has more wealth than they could spend in numerous lifetimes, but still want more and more. Yet so many struggle to afford some heating and basic living costs. Surely, it's time to do something different for the good of the majority, rather than the minority of the super-rich and privileged.
The Government is in the pockets of the corporations. Our institutions and representatives are not fit for purpose.
No, its because the wind and sun are putting the prices up .
It won't be long before the centre's of power will be taking violin cases to work and wearing spatz.😠
I’ve long said that central and local Government have become a Mafia regardless of which party they represent.
The regulator is bent. And the side effects of the UK's American style capitalist system.
Hit 250k today. Appreciate you for all the knowledge and nuggets you had thrown my way over the last months. Started with 24k in July 2024
This must be an investment with Mrs Geraldine Ann Philip
Wow! Kind of in shock you mentioned expert, Geraldine Ann Philips. What a coincidence!!
⠀ She helped me recover what I lost trying to trade myself
Geraldine Ann Philip understanding the market indicators is impressive. She knows exactly when to enter and exit trades for maximum profits. her siignals are top notch
We have EDF in UK and France but our French bill is half the UK bill - work that one out?
Talk about the energy companies' shareholder profits.
And directors pay , Amber Rudd is one at centrica
Why isn't there a market, and why don't we pay the market rate?
Because we don’t buy it directly and there is no choice there is no market.
@FiscalWoofer we do have a choice of supplier therefore there is a market.
There are many sellers and many buyers.
@@amleth_prince_of_denmark😂
@@amleth_prince_of_denmark I agree there is a market but what is the price difference between the different suppliers? Very very little, so that is price fixing, and what you’d expect a Cartel to offer. Where do they buy wholesale energy? It’s a cartel and a scam, but there is nothing you can do about it. Well you could go off grid fully solar and get them to remove the meter(s)
Personally I'm sick of utility rip-off prices, i don't think I'm alone.
We also got told we were bailing out bust companies. How long are we bailing them out for? Surely we've paid billions extra by now. Things go up with every excuse but never come down
They are looking at this though, as well as regional pricing. Reports should be out halfway through the year. Hopefully it'll lead to the right decision and lower prices
Reports out in summer, when many folks will be in debt to the energy companies for extortionate bills just to stay warm, or even just keep the lights on, and to cook. Who is doing the reports, and how much are they being paid to do the 'reports'? It can't be rocket science, can it?
I know the answer to your question. Ofgem does understand the reasons why marginal pricing of electricity onto the system hold prices high, but having constructed the whole mechanism themselves under their NETA and BETA market developments decades ago feel unable to scrap them today. Couple this with their price cap ( which effectively tells suppliers what tariff prices will be) for energy coming off the system and it is a market so hamstrung and inefficient it defies any logic. The icing on the cake was Ofgem driving through their ‘connect and manage’ which allowed generators to connect even though the network was inadequate to accept their output. For times of restriction (called constraints) they get paid handsomely for being switched down or off. Utter madness, but the big companies are making oodles so don’t care! All the industry policy makers dare not resolve as they need the wealthy businesses to invest to meet net zero promises. In this respect it is corrupt. Regard it as another tax, as government does and it works!
Did Ofgem create the regulations or did Government?
It’s to do with gas prices. As soon as they fire up the gas generators you have to pay that price.
Very interesting, thank you for the video. If we try to reduce the price we pay the producers like nuclear power plants (which require a massive investment cost up front), do we risk these operators not invest in the UK ans go elsewhere? We have to remember the funding crisis at Hinckley C etc between the French and Chinese. I think the UK is not paying for the building of those plants?
I don't think they know, because the media isn't interested in telling them
Another informative video. Thank you Richard. I’m not sure if I understand that there isn’t a marginal cost for electricity suppliers. Those power plants will have to have been built through investments first, which for nuclear plants could be in the billions. I think this is what we are paying for. The question is, once paid off, including the interest paid, how much does it cost to maintain and perhaps upgrade those power plants in the future. So there is an ongoing cost and one would think that regulators would ensure we get the best bang for our buck.
Thank you I really enjoyed the video. It's clear in the UK that we identify the blatant profiteering of some but the problem isn't solved there. Where we seem to fail is by not having a mechanism for change. These issues are ignored by the MSM and we have no obvious redress. People are really suffering and their suffering becomes a source of profit for the already wealthy. Why do we tolerate this!!!!
What is the "MSM" please?
@KeynshamBoy main stream media...BBC, ITV, CNN etc
Prices need to recover the investment costs and operating costs plus some profit. The way the market operates was set up before wind and solar and needs to be revised/restructured. But for the time being the government benefits from supertax on the green generators and has no incentive to change the system. As you say this scam needs to be called out. The Government is knowingly keeping prices high and blaming the generators. They think we are stupid and don't see it. Cheers
Been saying something to this effect for years. Luckily I’m pretty frugal and my energy costs £900 a year. I am in the process of disconnecting from gas entirely over the next few years, and will probably switch to one of the new tariffs available soon which gets rid of daily standing charge but with a slightly higher unit charge. Thinking about a home battery to shift energy usage around as well.
Subscribed!
Serious question: if gas is more expensive and it's cost sets the costs for all sources, why are wind energy companies saying that they can't operate under current income and want to charge more?
I swear...... unbelievable that it is even going up. Luckily I got a energy tariff before the prices went up
Fully, completely and totally agree that it's POLITICAL! If our governments were on our side we would be buying Russian energy at a small fraction of what we are paying. Instead, our prices are decided in Washington!
I cannot agree that buying energy from Russia which has invaded Ukraine is a good idea. Are you aware that Russia has invaded Ukraine?
So the security of european allies and the murder by novichock are things that don't concern you as long as your gas is cheap ?
That's a stupid idea - look how it worked out for Germany when Russia turned off supply!
@@chrispenn715 The Russian propaganda said it turned it off but it was the German govt itself that stopped importing. Then the Nord stream was sabotaged preventing any possible future deliveries apart from other long existant land lines. So instead of being dependant on russian gas, Germany is now dependent on US American and Norwegian suppliers.
@@Antonnick so you'd rather depend on a warmongering megalomaniac for gas supply? 😂😂😂
END. TIMES. CAPITALISM.
I just hope I'm around to see it.
The whole point is to reduce demand (as renewables can never match the full base load provided by gas/coal/nuclear generation)
People that own their land should start changing rent to the cable companies and reverse this stupid standing charges ..
Will we ever get any benefit from renewable green energy. Wind and Sun are free ?
There is no sun and wind this morning.
Just buy your own , It will pay for itself , mine did.
Email from Octopus Energy. FYI: Energy prices will rise about 1% from Jan-March.There seems to be a bias towards EV owners for cheaper electricity.
Only because they suggest EV owners to charge when grid demand is lowest.
It is incentive to invest into renewables until gas is phased out entirely. Many energy companies reinvest profits into building more solar/wind. If scheme is removed who will pay for it?
Domestic supply companies are different from the energy producers. Gas etc is bought on the open market as we dont have enough supply for the country, so we pay open market prices. The wholesale price of electricity is based on a price as cleared auction daily. Although this seems an expensive way to do it, most research shows that a price as bid auction would produce similar prices and would have a higher carbon footprint.
Marginal Costs - Wind Solar Nuclear would have ongoing payments from loans for Installation. And any smart company would also re-invset for replacements e.g. save up to replace solar panels when their lifespan declines.
But I still agree that our Energy Prices are far too high.
@RichardJMurphy - thanks for making your videos, they are always enlightening. You describe how all suppliers to the electricity market are paid at the marginal cost of the most expensive one. Is this the case for suppliers that are paid using the CFD model too?
3:50 It’s hard to understand how DRAX burning imported wood chips, which emit more pollution than coal, can be considered environmentally friendly. These wood chips are shipped from North America on fossil fuel-powered vessels, contributing further emissions, and their production involves deforesting carbon-absorbing trees. How can this process, which seemingly exacerbates environmental damage, be labeled as "zero carbon"? It seems more logical to question whether this is genuinely better for the planet than burning fossil fuels directly.
Almost all of this 'green' stuff is wildly expensive nonsense.
Please post your videos on Threads as well. 😊👍🏾🇬🇧