Rising cost of living

Gish-galloping at it’s finest…

https://12ft.io/proxy?q=https://www....a-ebd462f4142b March 2022

Gas and electricity networks top UK profit margin rankings

Soaring energy bills and power blackouts raise calls for greater scrutiny of regional monopolies

UK gas and electricity distribution companies have higher profit margins than any other sector, prompting calls for intervention at a time of soaring energy bills and frequent electricity blackouts in parts of the country.

The regional infrastructure monopolies whose pylons and cables carry electricity from power stations to end users are achieving operating margins of 42.5 per cent, according to analysis by industry research provider IbisWorld, while gas distributors are earning 40.5 per cent.

The margins, which come before tax and financing costs are deducted, outstrip those in more than 400 other sectors including private equity at 32.5 per cent and commercial real estate at 33.4 per cent, according to IbisWorld.

High operating margins enabled the regional electricity networks to pay out £3.6bn in dividends to their owners between 2017 and 2021, with gas distribution networks distributing £2.4bn to theirs over the same period,

Ofgem said in its state of the market report in 2019 that “the overall costs of the transmission and distribution networks to consumers . . . have turned out to be higher than they needed to be” and that “the majority of network companies are achieving profit margins towards the higher end of our expectations”.

[nomadking]

Originally Posted by Hugh

Gish-galloping at it’s finest…

https://12ft.io/proxy?q=https://www....a-ebd462f4142b March 2022

“The UK’s distribution networks are set to invest and spend more than £33bn over the next five years. This expenditure and investment — alongside the 36,000 people employed by the sector — secures safe, sustainable, reliable networks to deliver the energy that communities need now and in the future.”

It argues that UK households are paying the price for these payouts to owners — which include private equity, infrastructure funds and individuals such as Hong Kong’s billionaire Li family, which is weighing a £15bn sale of UK Power Networks, the country’s largest electricity network provider.

Are owners meant to splash out billions and never, ever see a return, unless they sell? It's a bit like if you got a business loan to buy a business. The loan needs paying back. So not real profits that they can spend or be taxed on.

The profit for the six months ended 30 September 2021 was £140.7m(2020:nil). In the current period,the Company received dividend income of £140.0m from Western Power Distribution Plc, the Company's direct wholly-owned subsidiary.

Still doesn't change the fact that the bulk of the increase in the standing charge has nothing to do with the distribution companies.
Link

Standing charges cover a range of costs faced by suppliers. Rory Stoves, from comparison website Energyhelpline, says for electricity these include network costs – running and maintaining the system, the supplier of last resort scheme, and things such as the warm home discount.
Stoves says network costs “inevitably go up, especially when inflation is high, as there are rising costs for wages, materials and so on”.
But a far bigger part of the increase is from the “supplier of last resort” scheme – every household is expected to pay the billions that have gone into rescuing customers from failed companies.

I should imagine that installation of Smart meters is in those costs as well.
Link

“The standing charge for gas has been increased a little, but for electricity it has been increased massively.
“The regulator has done that because there are a number of fixed costs that have gone up a lot.”
Martin highlighted the fact numerous energy firms have gone bust recently, and other companies have had to be subsidised to take these consumers on.
There are also transmission costs to bear in mind, as well as an increase to what is known as a green levy.

Brutal news today.

• 0.5% rise in interest rates. That'll be an unwelcome addition to anyone not on, or coming to the end of, a fixed term mortgage.
• Inflation set to sit 13% by the end of the year
• Recession predicted at the end of this year
• Ofcom is going to review the price cap every 3 months rather than 6

[Mr K]

Originally Posted by Damien

Brutal news today.

• 0.5% rise in interest rates. That'll be an unwelcome addition to anyone not on, or coming to the end of, a fixed term mortgage.
• Inflation set to sit 13% by the end of the year
• Recession predicted at the end of this year
• Ofcom is going to review the price cap every 3 months rather than 6

You forgot climate change, baby boomers bleeding the country dry, war with Russia and/or China and Trump making a comeback.... Oh and PM Truss, how lucky we are...

[Mad Max]

Originally Posted by Mr K

You forgot climate change, baby boomers bleeding the country dry, war with Russia and/or China and Trump making a comeback.... Oh and PM Truss, how lucky we are...

Just as well you don't live in Turkey, Mr K, you'd be jumping off the nearest bridge at their inflation rate.

Originally Posted by Mr K

You forgot climate change, baby boomers bleeding the country dry, war with Russia and/or China and Trump making a comeback.... Oh and PM Truss, how lucky we are...

Wanna tell me how I'm "bleeding the country dry"

[Mr K]

Originally Posted by Paul

Wanna tell me how I'm "bleeding the country dry"

Didn't know you were old enough to be retired Paul?

Thanks to the Govts promise to lock state pensions to the inflation rate, which they've lost control of, pensioners will now be getting >10% rises, whilst the working population get a fraction of that.

Meanwhile the country's debt increases massively and tomorrows pensioners can expect diddly squat.

Jam to bribe the Govt supporters today , sod all for future generations except having to pay for it all.

[papa smurf]

Originally Posted by Mr K

Didn't know you were old enough to be retired Paul?

Thanks to the Govts promise to lock state pensions to the inflation rate, which they've lost control of, pensioners will now be getting >10% rises, whilst the working population get a fraction of that.

Meanwhile the country's debt increases massively and tomorrows pensioners can expect diddly squat.

Jam to bribe the Govt supporters today , sod all for future generations except having to pay for it all.

10% of bugger all = not a lot per annum

Originally Posted by Mr K

Didn't know you were old enough to be retired Paul?

Thanks to the Govts promise to lock state pensions to the inflation rate, which they've lost control of, pensioners will now be getting >10% rises, whilst the working population get a fraction of that.

Meanwhile the country's debt increases massively and tomorrows pensioners can expect diddly squat.

Jam to bribe the Govt supporters today , sod all for future generations except having to pay for it all.

Yeh, living the dream…

https://www.theguardian.com/society/...l%20population.

One in five pensioners – more than 2 million people – are living in relative poverty in the UK, an increase of more than 200,000 in the past year alone, according to a comprehensive review of national data

I get my State Pension this November, and after tax it will be £666 per four weeks, or £8,658 per annum - a 10% on that is £66.60 per four weeks, or £2.38 per day extra…

I’m lucky - I’ve contributed to workplace pensions (4 final salary, 4 defined benefit), so I don’t have to survive on the State Pension, but if you think those on State Pensions are living the life of Riley, you’re sadly mistaken.

[Jaymoss]

Originally Posted by Hugh

Yeh, living the dream…

https://www.theguardian.com/society/...l%20population.



I get my State Pension this November, and after tax it will be £666 per four weeks, or £8,658 per annum - a 10% on that is £66.60 per four weeks, or £2.38 per day extra…

I’m lucky - I’ve contributed to workplace pensions (4 final salary, 4 defined benefit), so I don’t have to survive on the State Pension, but if you think those on State Pensions are living the life of Riley, you’re sadly mistaken.

£1600 more than I get and I survive quite well considering

[Mr K]

At least you have a state pension to add to all your other pensions Hugh . In 20 years time, I'm not sure UK plc will be able to afford it, which will be particularly unfair on those that have propped up today's pensioners.

Originally Posted by Jaymoss

£1600 more than I get and I survive quite well considering

How do you pay rent/Council Tax on £7k per year?

(Not to mention utilities and food)

---------- Post added at 22:14 ---------- Previous post was at 22:12 ----------

Originally Posted by Mr K

At least you have a state pension to add to all your other pensions Hugh . In 20 years time, I'm not sure UK plc will be able to afford it, which will be particularly unfair on those that have propped up today's pensioners.

You missed the bit about 1 in 5 pensioners living in relative poverty…

[Jaymoss]

Originally Posted by Hugh

How do you pay rent/Council Tax on £7k per year?

(Not to mention utilities and food)

---------- Post added at 22:14 ---------- Previous post was at 22:12 ----------


You missed the bit about 1 in 5 pensioners living in relative poverty…

I only pay Bedroom tax and a portion of CT I am also on the Big Difference scheme so only pay a fraction of my water rates. Those solely on SP will have access to these benefits too

Gas and electric are already 20% and from October 27% I pay £28 to VM and £6 for mobile phone. I online shop every 2 weeks and have around £40 to £50 per months for sundries / luxuries. I do not drive which does help a fair bit I guess and if I want to treat myself I buy on paypal credit when ebay or certain stores offer 0% interest plus I hardly drink and do not smoke

I consider myself fortunate that I live a system where I can live with my health problems without really struggling.

Also I tend to live off very simple foods quite cheaply when I need to free up some cash for other stuff.

[TheDaddy]

Originally Posted by Mr K

At least you have a state pension to add to all your other pensions Hugh . In 20 years time, I'm not sure UK plc will be able to afford it, which will be particularly unfair on those that have propped up today's pensioners.

It's more than unfair It's embezzlement, it's not a benefit it's a pension we've all paid into, people used to kill themselves if they got caught dipping into the company pension schemes

Originally Posted by Hugh

How do you pay rent/Council Tax on £7k per year?

He doesn't...

[Jaymoss]

Originally Posted by Mr K

At least you have a state pension to add to all your other pensions Hugh . In 20 years time, I'm not sure UK plc will be able to afford it, which will be particularly unfair on those that have propped up today's pensioners.

What do you think will happen? Do you think people will be left with nothing at all ?

---------- Post added at 22:25 ---------- Previous post was at 22:24 ----------

Originally Posted by TheDaddy

He doesn't...

I pay some
As I said the Bedroom tax for the extra room in the house and a portion of the CT it comes to around £25 a month. I know it is not a lot and as I said I am fortunate.