Energy price rises and price cap discussion.

[Nicholas Lewis]

Thanks. The magic search term appears to be 'merit order'.

It is sort of merit order but not the way the CEGB ran the system. There task was to call upon cheapest generators first and only use the expensive generators as a last resort but when they did they supplied a small amount of power and never set the system price like today. CEGBs successor National Grid Electricity Supply Operator ( soon to ne nationalised) does the same in trying to balance the system but its loaded against them as they largely only have CCGTs available to despatch to keep the system balanced and with gas prices so high they are now ultra expensive and then everyone then gets the same price irrespective of generation cost. A system based on merit order (ie the actual cost of generation) would result in a lower cost.

 

[najaB]

A common fallacy.
Carbon is carbon, doesn't matter if it was sequestered last week or a million years ago.

How is it a fallacy? If you're talking net CO2 as compared to pre-industrial levels then carbon that was taken out of the atmosphere and returned to the atmosphere in the post-industrial period is net zero as compared to carbon that was sequestered millions of years ago.

And that's ignoring the fact that a significant proportion of the carbon is going to remain in the form of ash.

 

[Dent]

A common fallacy.
Carbon is carbon, doesn't matter if it was sequestered last week or a million years ago.
You're better off leaving the tree living and absorbing carbon, and burning gas which is far more efficient than burning wood in any case.

Planting trees and leaving them living forever is not a realistic business model for the forestry industry, they need to produce a product in order to actually have a business.

 

[tomuk]

Planting trees and leaving them living forever is not a realistic business model for the forestry industry, they need to produce a product in order to actually have a business.

Yes but if you cut them down so long as you don't burn them you will have still captured the carbon.

== Doublepost prevention - post automatically merged: 23 Aug 2022 ==

It is sort of merit order but not the way the CEGB ran the system. There task was to call upon cheapest generators first and only use the expensive generators as a last resort but when they did they supplied a small amount of power and never set the system price like today. CEGBs successor National Grid Electricity Supply Operator ( soon to ne nationalised) does the same in trying to balance the system but its loaded against them as they largely only have CCGTs available to despatch to keep the system balanced and with gas prices so high they are now ultra expensive and then everyone then gets the same price irrespective of generation cost. A system based on merit order (ie the actual cost of generation) would result in a lower cost.

What alternative to using gas powered stations to balance the system is there? Wind may have very low marginal costs but it isn't reliable. With the various renewables obligation and Cfd the generators don't get paid the actual cost of generation anyway.

 

[brad465]

Planting trees and leaving them living forever is not a realistic business model for the forestry industry, they need to produce a product in order to actually have a business.

Yes but if you cut them down so long as you don't burn them you will have still captured the carbon.

I'd much rather we develop a hemp industry to replace the use of wood in paper, oil in plastic, lithium in batteries, among an abundance of potential, but that's another matter (although if hemp/alternative materials reduce reliance on fossil fuels and is scaled up to cheapen production it has a long term benefit to energy costs).

 

[Nicholas Lewis]

What alternative to using gas powered stations to balance the system is there? Wind may have very low marginal costs but it isn't reliable. With the various renewables obligation and Cfd the generators don't get paid the actual cost of generation anyway.

None currently but the point is other generators should only get their bid price not the system marginal price. The windmills already receive hefty subsidises without benefitting further. CfD generators are still a small proportion of total generation although set to grow substantially over next couple of years.

 

[Lloyds siding]

A common fallacy.
Carbon is carbon, doesn't matter if it was sequestered last week or a million years ago.
You're better off leaving the tree living and absorbing carbon, and burning gas which is far more efficient than burning wood in any case.

Is that so?
The reason fossil fuels have that name is because the carbon in them has been locked up in rocks for millions of years. By digging them up and burning these fuels we reintroduce carbon from 60+ million years ago and add it to the stuff already circulating and being sequestered from our atmosphere now. The sequestration bit can't keep up.

 

[Trainbike46]

None currently but the point is other generators should only get their bid price not the system marginal price. The windmills already receive hefty subsidises without benefitting further. CfD generators are still a small proportion of total generation although set to grow substantially over next couple of years.

Renewable generators on CfD contracts pay the difference between market rate and their set price to the government already, who substract that money from energy bills, they are the reason the green levies are going negative (so reducing peoples energy bills) from October

== Doublepost prevention - post automatically merged: 24 Aug 2022 ==

Adding more renewable generators reduces the amount of time the price is set by expensive gas, and if they are on CfD contracts (most recent ones are), they will also directly reduce the electricity bills

 

[TheBigD]

Had an email from my energy supplier earlier this morning...

I'm currently paying £118 per month, they are increasing it to £373.

I'm £200 in credit and currently using around £55 per month (I know I'm a tight cnut!) for just me in a 4 bed detached house.

10 minutes later using their online chat, I'm back to £153.

How the foxtrot do they calculate these figures? If i was being cynical, I'd think that they were trying it on!

 

[trebor79]

How is it a fallacy? If you're talking net CO2 as compared to pre-industrial levels then carbon that was taken out of the atmosphere and returned to the atmosphere in the post-industrial period is net zero as compared to carbon that was sequestered millions of years ago.

Is that so?
The reason fossil fuels have that name is because the carbon in them has been locked up in rocks for millions of years. By digging them up and burning these fuels we reintroduce carbon from 60+ million years ago and add it to the stuff already circulating and being sequestered from our atmosphere now. The sequestration bit can't keep up.

Please tell me how and why the warming potential of carbon removed from the atmosphere say 5 years ago is lower than that removed from the atmosphere 5 million years ago? You are still adding to the carbon in the atmosphere, and almost certainly at a greater emissions rate than with some fossil fuels due to the poorer efficiencies.

And that's ignoring the fact that a significant proportion of the carbon is going to remain in the form of ash.

Absolute piffle! The carbon bond is where all the energy is, carbon in ash is typically less than 2% on ash, and the ash itself typically around 10% on fuel. So if the fuel is circa 50% carbon, something like 99.6% of the carbon present in the fuel is burned.

 

[Dent]

Please tell me how and why the warming potential of carbon removed from the atmosphere say 5 years ago is lower than that removed from the atmosphere 5 million years ago?

Where did anyone say it was?

You are still adding to the carbon in the atmosphere

No your are not, and that is the point. Taking carbon from the atmosphere and then putting back only the same carbon that you took from the atmosphere in the first place is not a net addition of carbon to the atmosphere.

 

[trebor79]

Where did anyone say it was?


No your are not, and that is the point. Taking carbon from the atmosphere and then putting back only the same carbon that you took from the atmosphere in the first place is not a net addition of carbon to the atmosphere.

<sigh>
Let's say there's 100 units of carbon in the atmosphere. A tree grows and sucks up 90 of them. I chop the tree down and burn it, and release 9.96 of them back into the atmosphere, now I have 99.96 units of carbon in the atmosphere.
Instead of chopping the tree down, I burn some gas - let's say it contains 5 units of carbon (because CCGT is about twice as efficient as burning trees) and leave the tree alone. Now I have 95 units of carbon in the atmosphere.

 

[Starmill]

Where did anyone say it was?


No your are not, and that is the point. Taking carbon from the atmosphere and then putting back only the same carbon that you took from the atmosphere in the first place is not a net addition of carbon to the atmosphere.

It's worth noting that there always is still a net addition, because you need to put lots of energy into harvesting and drying timber, then transporting it to the consumer, before you can use it as a fuel.

 

[Dent]

<sigh>
Let's say there's 100 units of carbon in the atmosphere. A tree grows and sucks up 90 of them. I chop the tree down and burn it, and release 9.96 of them back into the atmosphere, now I have 99.96 units of carbon in the atmosphere.
Instead of chopping the tree down, I burn some gas - let's say it contains 5 units of carbon (because CCGT is about twice as efficient as burning trees) and leave the tree alone. Now I have 95 units of carbon in the atmosphere.

None of that changed the fundamental fact that taking something and then returning the same thing is not a net addition.

== Doublepost prevention - post automatically merged: 24 Aug 2022 ==

It's worth noting that there always is still a net addition, because you need to put lots of energy into harvesting and drying timber, then transporting it to the consumer, before you can use it as a fuel.

That wasn't what was being claimed.

 

[Starmill]

That wasn't what was being claimed.

It wasn't. But it is a key reason why expanding the use of wood as a fuel isn't going to happen, and wouldn't help.

 

[trebor79]

None of that changed the fundamental fact that taking something and then returning the same thing is not a net addition.

It is a net addition as you've chopped down a tree and burnt it.
It doesn't matter whether you use a fresh tree or a million year old tree that's turned into something we call coal or natural gas.

We're going to have to agree to disagree.

 

[DelayRepay]

Had an email from my energy supplier earlier this morning...

I'm currently paying £118 per month, they are increasing it to £373.

I'm £200 in credit and currently using around £55 per month (I know I'm a tight cnut!) for just me in a 4 bed detached house.

10 minutes later using their online chat, I'm back to £153.

How the foxtrot do they calculate these figures? If i was being cynical, I'd think that they were trying it on!

I'm with Bulb and they're suggesting I reduce my Direct Debit. I'm £400 in credit following their suggested increase earlier this year. But they haven't emailed me - I only noticed this suggestion when I was looking at my online account. I don't think their original increase was unreasonable given that we're heading into Autumn and I've been proactively trying to reduce my energy usage.

My plan is to leave it until after Friday, then assess it when we know what the new price cap will be. My hope is that the credit I have, and the government support, will mean there's no need for me to increase my Direct Debit to cover the new prices. But who knows?

 

[Lloyds siding]

None of that changed the fundamental fact that taking something and then returning the same thing is not a net addition.

== Doublepost prevention - post automatically merged: 24 Aug 2022 ==


That wasn't what was being claimed.

You sound like an engineer. I'm a biologist, as such, I'm interested in the tree...with its 90 units of carbon in your mass flow scheme. What would happen to them if you choose not to burn it?

 

[Dent]

You sound like an engineer. I'm a biologist, as such, I'm interested in the tree...with its 90 units of carbon in your mass flow scheme. What would happen to them if you choose not to burn it?

And did what with it instead? If it was burned by someone else then the carbon would still have been returned to the atmosphere, or if it wasn't needed by anyone and therefore wasn't planted in the first place the three carbon would not be taken from the atmosphere.

 

[Howardh]

I've had this letter from OVO

We’re sorry, we underestimated your energy use​ Meter readings help us keep your energy account up to date and send you accurate bills. Unfortunately, when we used your most recent meter reading to update your energy account, it’s shown that we’ve been underestimating how much energy you use. This means your bills have been incorrect since 2020-11-07, and we’ve been billing you for less energy than you’ve actually used. We won’t charge you for energy used more than 12 months ago​ You don’t have to pay any extra for the energy you used before 2021-08-24 – that’s because it’s taken more than 12 months for us to sort this billing error. We've already applied the payments you made before 2021-08-24 to help pay for the extra energy you used – but we won't ask you to make any more payments for energy you used over 12 months ago. This follows guidance set by Ofgem, the energy regulator. We've already applied the payments you made before 2021-08-24 to help pay for the extra energy you used – but we won't ask you to make any more payments for energy you used over 12 months ago. This follows guidance set by Ofgem, the energy regulator. Here’s what this means for you: For the incorrect bills between 2020-11-07 and 2021-08-24, we charged you 759.81 But your energy use actually cost 759.82 Over this period, you paid a total of 861.87 This means your payments during this period covered the difference between our incorrect estimate and your actual energy use. We’ve also recalculated your energy use for the last 12 months​ This means you now have a positive balance of 862.61 as of 24/08/2022. Everything’s now up to date, so you don’t need to do anything.

Can you imagine how I felt opening up the e-mail; talk about stomach dropping to the floor? I feel violated in some way, surely to frighten people like this is illegal?? the amount I paid is actually more than I use, I'm in credit gawdammit!!

 

[GusB]

I've had this letter from OVO

​

​ We’re sorry, we underestimated your energy use​ Meter readings help us keep your energy account up to date and send you accurate bills. Unfortunately, when we used your most recent meter reading to update your energy account, it’s shown that we’ve been underestimating how much energy you use. This means your bills have been incorrect since 2020-11-07, and we’ve been billing you for less energy than you’ve actually used. ​ We won’t charge you for energy used more than 12 months ago​ You don’t have to pay any extra for the energy you used before 2021-08-24 – that’s because it’s taken more than 12 months for us to sort this billing error. We've already applied the payments you made before 2021-08-24 to help pay for the extra energy you used – but we won't ask you to make any more payments for energy you used over 12 months ago. This follows guidance set by Ofgem, the energy regulator. We've already applied the payments you made before 2021-08-24 to help pay for the extra energy you used – but we won't ask you to make any more payments for energy you used over 12 months ago. This follows guidance set by Ofgem, the energy regulator. Here’s what this means for you: For the incorrect bills between 2020-11-07 and 2021-08-24, we charged you 759.81 But your energy use actually cost 759.82 Over this period, you paid a total of 861.87 This means your payments during this period covered the difference between our incorrect estimate and your actual energy use. ​ We’ve also recalculated your energy use for the last 12 months​ This means you now have a positive balance of 862.61 as of 24/08/2022. Everything’s now up to date, so you don’t need to do anything.​ ​ ​

Can you imagine how I felt opening up the e-mail; talk about stomach dropping to the floor? I feel violated in some way, surely to frighten people like this is illegal?? the amount I paid is actually more than I use, I'm in credit gawdammit!!

The "back billing" policy has been applied here. The error is on their part, therefore they cannot bill you for anything more than 12 months of energy.

 

[Howardh]

The "back billing" policy has been applied here. The error is on their part, therefore they cannot bill you for anything more than 12 months of energy.

True but I've never had an estimated bill with OVO and the money taken has always matched the energy used at their prices as per contract. If they were charging me an incorrect tariff and I'd been under-charged for the current 12 months, well that would have been the contract we both signed up to, so can't see how they could charge anyone more.

This email should not have been sent to me, I'm still shaking an hour later; I have written a complaint about it, demanding an apology.

 

[Ediswan]

For the incorrect bills between 2020-11-07 and 2021-08-24, we charged you 759.81 But your energy use actually cost 759.82​

Under-charged by 1p ?

 

[GusB]

True but I've never had an estimated bill with OVO and the money taken has always matched the energy used at their prices as per contract. If they were charging me an incorrect tariff and I'd been under-charged for the current 12 months, well that would have been the contract we both signed up to, so can't see how they could charge anyone more.

This email should not have been sent to me, I'm still shaking an hour later; I have written a complaint about it, demanding an apology.

They've underestimated your usage by a penny! Your payments have more than covered it - why bother complaining?

 

[Howardh]

They've underestimated your usage by a penny! Your payments have more than covered it - why bother complaining?

Because of the immediate stress opening the e-mail. Still shaking an hour later. And that if they needed the penny so badly, I've £800+ in credit. Chances are it's not even a penny, that they've simply rounded the figure up and it doesn't even exist.

Also they don't estimate my useage - I've had a smart meter for some time and before that the readings were sent in monthly, every month. When they send you an opening line "We've underestimated your useage" I'm immediately thinking "what the etc." Comp[anies have got to STOP this nonsense and read and understand what they are sending out.

 

[Domh245]

I was initially going to make the same point about it being only a penny, but that covers the period they can't charge you for! It seems like there was also some discrepancy on the current bill but it isn't clear what this is (unless what you paid over the errant period is your balance, in which case the discrepancy is around the £1.50 mark)

But I agree, given the extent to which energy (and it's cost) is a big concern for many people, getting an email in your inbox saying "We’re sorry, we underestimated your energy use" is going to cause a lot of panic for many. For something this small, I think it'd have been better placed as a simple "adjustment" on your next bill with accompanying note, but I'm also aware of just how inflexible most energy suppliers are when it comes to documents like that! What's worse is that it's almost probably going to have been an entirely automated issue where a couple of readings went in the wrong order and it got put on this as the closest matching template! Certainly would say you're within your rights to complain to Ovo, they might even fix whatever caused the issue and prevent future recurrences (but I wouldn't hold my breath)

 

[trebor79]

Because of the immediate stress opening the e-mail. Still shaking an hour later. And that if they needed the penny so badly, I've £800+ in credit. Chances are it's not even a penny, that they've simply rounded the figure up and it doesn't even exist.

Also they don't estimate my useage - I've had a smart meter for some time and before that the readings were sent in monthly, every month. When they send you an opening line "We've underestimated your useage" I'm immediately thinking "what the etc." Comp[anies have got to STOP this nonsense and read and understand what they are sending out.

99% sure this has been sent by a computer that's picked up a 1p rounding error. No human will have been involved.
Not worth stressing over IMO.
I'd be getting more exercised about the £800 of your money they are holding in their account. Bulb did that to us so I reduced the direct debit to £3 until I'd recovered all of it.

 

[najaB]

For something this small, I think it'd have been better placed as a simple "adjustment" on your next bill with accompanying note, but I'm also aware of just how inflexible most energy suppliers are when it comes to documents like that! What's worse is that it's almost probably going to have been an entirely automated issue where a couple of readings went in the wrong order and it got put on this as the closest matching template!

Indeed. It is 99.9% likely that this was completely automated and never passed the desk of a human.

That said, they really should have some logic in place to suppress such emails when the amount involved is quite small - either over or under.

 

[XAM2175]

Nah, I'm with @Howardh here - that's an extremely heavy-handed way of communicating what ultimately seems to be a very trivial discrepancy. I don't think I'd still be still be shaking an hour later had I received it, but I'd be inclined to send their customer service people an "are you serious?" note all the same.

 

[DynamicSpirit]

It is a net addition as you've chopped down a tree and burnt it.
It doesn't matter whether you use a fresh tree or a million year old tree that's turned into something we call coal or natural gas.

We're going to have to agree to disagree.

I think the difference hinges on whether or not you replace the tree.

If you simply burn a tree and it releases X kg of carbon into the atmosphere, then you are correct that, by itself, that has the same global warming impact as burning fossil fuels to release the same X kg of carbon would do.

However, if burning a tree, then you would hope that the plan is to plant another tree to replace it, which willl then absorb X kg of carbon from the atmosphere during its life. Get a cycle of doing that, and it will be carbon-neutral-ish in the long run, provided you're not using too much CO2 in all the processes involved with managing the tree and chopping it down etc.

Personally I'd still prefer renewables though. I'd imagine burning wood must release a lot of other nasty pollutants besides CO2.+