Energy Prices Today

Energy Suppliers are falling at an alarming rate. 16 suppliers in the UK have now gone bust, with 14 of those in the last 2 months. Year to date, over 2.4 million households have been affected by energy supplier failures.

As of yesterday, energy was trading at ￡179 p/mwh, peaking at ￡189 p/mwh, (sourced from https://www.epexspot.com/en ) Roughly speaking 1mwh is 1000 kWh. This works out as ￡0.18 per kWh. Energy companies then need to make a profit, and they do this by adding a 20% tax levy after the initial energy cost. This allows them to pay the regulation, billing platform and staff wages, etc. After-tax, the final cost for the consumer is ￡0.36 p/kWh.

If we look at 2019 energy prices, they were around ￡60 p/mWh, which equated to approximately ￡0.18p p/kWh as a final cost to consumers, and that’s a big difference to your yearly energy costs, half the cost to be exact.

Another nail in the energy providers' coffin was that Energy suppliers will be unable to retain contracts shielding them from soaring wholesale gas prices.?CNG Group, which ships and provides gas to more than a dozen suppliers in the UK, has set a deadline for the end of November for energy providers to have made alternative shipping arrangements.

What does this mean for consumers?

Sadly, going off yesterday’s energy trading figures, this is going to have a huge impact on people’s lives and bank balances. We’re all in the same boat when it comes to energy suppliers. Some of us have a choice, albeit a very limited one, but customers that are with energy providers that have gone out of business are being forced onto their new provider's variable tariffs, and this is not ok. Those affected customers should still have some sort of choice.

Martin Lewis is currently advising customers that are coming to the end of their fixed-rate tariffs to do nothing, (https://www.moneysavingexpert.com/news/2021/10/martin-lewis---do-nothing--with-your-energy-supplier/ ) and automatically move onto the price cap tariff’s; and of course, this is absolutely the right thing to do. Energy companies will try to force their hand in moving you onto higher rate tariffs to line their pockets. It’s not about ‘protecting customers’, it’s about protecting their investment and the cost that they’ve paid for the energy.

What’s worse is that these prices are only going to get higher, and the most vulnerable customers are going to be subjected to making some very tough decisions over the coming weeks and months. Do they choose to heat or eat?