Energy prices seem to be going up and down simultaneously. That’s the news today in the UK. To explain. Most of the big six suppliers are holding off on price increases or even cutting prices but warning of big increases to come in the spring. One supplier is cutting its gas prices but freezing its electricity prices until the spring. It has then warned that electricity prices will increase by quite a lot (nearly 10%). Are these rises justified, -possibly? Brexit has made the pound drop and the cost imported fuels rise (I remember being promised we would have the power to cut VAT on energy bills by 5% but these are bigger rises than that). Wholesale gas prices are said to have risen and France is buying up all the spare electricity it can.
So what’s going on regarding energy prices? As this blog has covered before there have been big hikes in energy prices and these have been politically controversial. They without any doubt led to steep cuts in renewable energy and energy efficiency support. The big energy companies are hoping they can get away with if they delay until the spring when energy demand falls.
This makes we wonder if seasonal differential pricing is one way of dealing with energy price increases. In summer when there is plentiful solar power prices could be very low. In winter they could be higher. People who struggle to pay could save in the summer and use the money to pay for energy in the winter. Its not ideal but it might work and even in the UK this to a certain extent happening anyway with solar pushing wholesale prices right down. Smart meters should so it is said lead to highly variable differential pricing.
In the meanwhile our book has a whole heap of different ways you can save energy. Shop around for the best deal and consider switching to the smaller companies. Happy Christmas.