Author Topic: "Gas Armageddon": Energy/electricity prices in EU/UK (and how to deal with them)  (Read 79167 times)

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Online tom66Topic starter

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The speculation is that new UK PM Truss will borrow massively to cap energy bills at £2500 pa for the "Average Household".  Whilst this is probably the morally correct thing to do, one wonders if it will just cause more inflation of energy prices and lug the UK with yet more debt.  It needs to be combined with windfall taxes on the producers that are making bank.
 

Offline BravoV

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Quote
recently UK's PM Boris Johnson
Energy prices had very little to do with his demise .More he was a useless lying ***t


His lying and nasty behavior are not the big problem, if he managed to rule the country well, he wasted his own leverage when he won on the Brexit, and basically throw that powerful momentum away and creating more problems for the country instead.

I have dozens of friend native Britons, told me basically if the UK's economy was fine & dandy, most Brits will sort of close their eyes and ignore on his nastiness, but since problems and problems piling up starting on his reign, hell, even he was breathing weirdly will be used as an excuse to topple him, let alone those lying he had done. 

Online Marco

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Thats the plan from the start of the heavy sanctions and robbing Russia's reserved money

The plan was to make the best of a disastrous situation and prevent an easy war from becoming a springboard to military belligerence and planting plain clothes combatants in the Baltics.
 

Offline Siwastaja

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We can do nothing but to watch this farce, and of course re-design our lives from scratch, for example become more self-sufficient with food and energy, stop going to work (or at least stop getting paid for it), and so on. And of course, with no public healthcare anymore, and with no money to buy private services, better not fall sick. Full blown survivalist shit we all laughed at just a few years ago.
You are being overly dramatic. Europe was shot to bits not that long ago and we recovered just fine. Every few years there is a crisis. You know what they say: 7 good years are followed by 7 bad years and vice versa. This is not the first time things go bad and it won't be the last time.

It is easy to say when you distribute the loss, but the specific problem we are seeing here is that our current puppets are pretty much sacrificing our very small country for the sake of the energy prices in other EU countries.

If we just look at Uniper/Germany's cheap 10-year gas contracts, the problem is here: 20-30 billion out of the pockets of a 5M people country, to the pockets of a 80M people country, totally kills the former, but does not help the latter much, only a very minor and temporary relief. Me pay 10000, you get 500, you got it?

So the problem is this: during active energy war in Ukraine, Uniper makes 10-year fixed price gas contracts in Germany: what could go wrong? When it is obvious it is going under, puppets in Finland decide it is a good investment, against all experts and Uniper itself, to buy majority share of the German company. And when it is finally actually going bankrupt, which is what it should do, finally ceasing the fixed contracts and exposing the real prices to the German consumers, this bankrupt is prevented again and again by pushing billion after billion of Finnish taxpayer money into the company. And it's still not stopping.

There have been economic disasters in Finnish history, such as buying hugely expensive 3G mobile operating licenses with taxpayer money all over Europe in early 2000's, which all ended up being a loss. But the Uniper scandal, is by far, the biggest economic disaster in the whole Finnish history, and it still isn't over.

Of course "it is only debt, it doesn't need to be paid back". That also ensures we are going to be in debt in unforeseeable future, because interests keep running. That only means increase in taxes, and that means people will do everything they can to avoid paying taxes, which means cease of innovation and/or wide spread black market. That means further collapse of public healthcare etc. although many consider it already collapsed during last 2-3 years. Now it is widely reported that getting a stroke, for example, puts you in 5-hour queue for treatment, so you just simply die or worse, become paralyzed or brain damaged. This is totally unheard of and does not repeat every 7 years as you say.

So no, this is not your "usual crisis". Of course recovery and rebuilding is always possible, and that is what I am eagerly waiting for, because I like to be constructive. But right now, we are not at that phase yet. We are just watching our country being actively destroyed. It needs to hit certain rock bottom before the reconstruction can begin.
 

Online nctnico

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But that is a 'Finland' problem caused by people that where put in power by democratic voting.
There are small lies, big lies and then there is what is on the screen of your oscilloscope.
 

Offline BravoV

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... look at Uniper/Germany's ... <snip> ..

Talking of Uniper, a non Russia propaganda  :-DD news site (US-CNBC) just published today ...

-> https://www.cnbc.com/2022/09/06/uniper-says-worst-is-still-to-come-as-russia-halts-gas-flows-to-europe.html

Quote ...

"German gas giant Uniper says the worst is still to come after Russia halts flows to Europe"

I have said this a number of times now over this year and I’m educating also policymakers. Look, the worst is still to come,” Uniper CEO Klaus-Dieter Maubach told CNBC on Tuesday at Gastech 2022 in Milan."


The Russia sanctions launched by US & EU was deliberately, knowing the catastrophe and side effects to come in advance.

Above (highlighted) is "one of the proofs" that Western politicians were warned by the industry experts, even US Janet Yellen and almost all EU central bankers were opposed with the sanctions before it was launched in Feb, knowingly the after effects especially on the economy & energy, this was not reported in headline news at Western MSM and heavily redacted, foot noted or not reported at all at some big ones.

You do not need to be an industrial genius, that shutting down Russia oil & gas which represent big chunks of global market (hence Russia is member of OPEC+ cartel) and expecting other oil & gas producers have ready "enough spare capacities" to cover that lost is just unbelievable.

Its like expecting chip manufacturers to have spare big production capacity to serve an ad-hoc customers, just because the customer is rich and can be instantly churn out the new chips in weeks or months, its so naive.  :palm:

Offline Siwastaja

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But that is a 'Finland' problem caused by people that where put in power by democratic voting.

Yes, that is totally true, our election is very reliable in the sense of not getting manipulated in classical ways like modified tickets or whatnot. OTOH, the convention how the cabinet is built is pretty weird, so instead of mixing the top 2-3 winner parties, it's now a mix of the winner alone (17.7%), plus all the losers, ignoring the #2 (17.5%) and #3 (17.0%). (We have the convention of only building majority cabinets here which makes everything simple because every law will be automatically passed in the parliament, and I can accept that, it's one way of doing it, but it does get pretty weird when you have the "winner" (17.7%) plus all the losers to barely exceed the required 50% vote share. It's still kinda-democracy, but it puts the majority of what people actually voted for (17.5%+17.0%) in powerless opposition.)

Plus the guy who promised 100€/month to every pensioner who votes him as a PM, to gain the winning place by 0.2%, was replaced within months by The Better PM people did not vote for, who now, to be fair, has almost North Korea / Russia level support from the people (in totally free popularity measurements, and I'm again sure they are not technically manipulated), and this popularity stays even getting caught red handed in cocaine party, and likely high on cocaine in duty, during the very discussions in which she approved the 8 billion EUR Uniper packet. But hey, police officially commented that they will not investigate, but anyone who discusses this online may be prosecuted, so I'm at ****ing risk right now writing this very post, but I'm doing it anyway. This is something I don't consider a part of free democracy, but that going in the direction of Russia or North Korea.

But the media control laws put in place during early COVID are working well, and in our taxes we also have to pay for the officials who use their work time to feed made-up stories about our great PM to the foreign media. I consider it wasted effort, but it works really well, because then our media can report how our PM is popular somewhere else, and weirdly this is really important for many Finns. (See the elephant joke http://finnishnightmares.blogspot.com/2015/12/its-not-true-at-least-not-all-of-it.html)

I'm not joking. I wish I was. This is really sad time to witness.

So I hope this gives you some background about the stage on which the history biggest economical disaster of this country has been created on. And I'm sure many programmed bots will strongly disagree, but the great thing about facts is, it is totally irrelevant whether one disagrees or agrees with them. And I'm sorry how it's drifting, but it is fundamentally all connected to the gas, and Germany's decision to enable their "green shift" by utilizing cheap natural gas supplied by Russia, and keep doing that even during times it all is falling apart.
 

Online Marco

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You do not need to be an industrial genius, that shutting down Russia oil & gas which represent big chunks of global market (hence Russia is member of OPEC+ cartel) and expecting other oil & gas producers have ready "enough spare capacities" to cover that lost is just unbelievable.

Which is why they didn't, neither gas nor oil was significantly sanctioned. Although I suspect oil sanctions are coming sooner than later at this point, with secondary sanction muscle from the US (even with Pooh screaming). No one expected the war to last this long. It's the current sanctions combined with the arm shipments and Russia's incompetence in winning this war which led to this total shitshow, which despite dollars in the bank is going to drag Russia down too. The sanctions as they were wouldn't have driven Putin into a corner enough to cut off gas, if he had won the war ... but he didn't so dead Russians and destroyed equipment pile up and Putin has to do something. Everyone is pot committed to a situation they did not anticipate, Ukraine fighting so steadfastly and Russian military being incapable of taking Kiev.

For better or worse three other former Russified nations with lots of Russian speakers which Russia feels are being discriminated against, which was the closest they came to a casus belli for the Ukraine war, are already part of NATO and the EU. Neutrality was never an option.
« Last Edit: September 06, 2022, 04:50:27 pm by Marco »
 

Offline JohanH

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Then we all deserve what is coming, because making Europe dependent on Russia is the most utterly mindless stupidest thing ever. Merkel & Co will go to history as the most failed example of energy policy makers ever. And politicians in other countries who pretend they didn't see this, must bear consequences. Finnish governments after 2014 have been so blind. Now the current government have made the only rational decisions and if we get into NATO, I think other policies vis-à-vis Russia won't be as stupid in the future (of course easy to say now when all cards are on the table).

I don't care anymore, Ukraine is burning, freezing, whatever, so it's our turn to freeze soon. The whole EU will and must bear the consequences collectively and Germany can pay off the failures in the next fifty years. Sorry Brits, I don't think you can escape, you are still too tied up and dependent on EU and you will also suffer.
 

Offline BravoV

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Curious how many Brits reading this thread will join this movement ? Or this is just a noise in UK and its over-blown up by the media ?

-> https://www.cnbc.com/2022/09/06/uk-energy-bill-boycott-dont-pay-gains-traction-truss-to-offer-relief.html

« Last Edit: September 06, 2022, 04:51:37 pm by BravoV »
 

Online nctnico

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So I hope this gives you some background about the stage on which the history biggest economical disaster of this country has been created on. And I'm sure many programmed bots will strongly disagree, but the great thing about facts is, it is totally irrelevant whether one disagrees or agrees with them. And I'm sorry how it's drifting, but it is fundamentally all connected to the gas, and Germany's decision to enable their "green shift" by utilizing cheap natural gas supplied by Russia, and keep doing that even during times it all is falling apart.
Yeah. I never understood Germany's push for natural gas (up to the point where they got the EU to label it as a 'green alternative fuel') in a time where fossil fuel use has to be reduced.

If you look 20+ years back in time, Russia was a stable country with reasonably good leadership. And since a significant part of Russia is in Europe, they made a good trading partner for goods and energy. That opportunity is still there. Again, the problem isn't Russia itself but the people who seized power in Russia and like to bring back the USSR. By now Russia could have been a great economic power but Poetin flushed it all down the drain. Partly by supporting dubious regimes as well.
« Last Edit: September 06, 2022, 05:10:51 pm by nctnico »
There are small lies, big lies and then there is what is on the screen of your oscilloscope.
 

Offline Siwastaja

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Merkel & Co will go to history as the most failed example of energy policy makers ever.

On the other hand, I also think Germany has done some excellent job at going truly green with renewables.

Doing the right choices, and some REALLY bad choices seems to go hand-in-hand.

Sadly, even at the excellent rate Germany is doing with renewables, wind and solar specifically, it still takes maybe 10 years plus some more investments in energy storage before the grid can be freed from Russian's gas.

The biggest single wrong choice was such total dismissal of nuclear. I don't like nuclear in the long run, but keeping the existing plants running is pretty much a must. Replacing both nuclear and fossils with renewables is a good long-time target, but cutting the dependence on Russian import gas should have been #1 priority, but it was clearly the opposite, the whole green shift was based on having that as the only stable resource.

Dismissal of heatpumps in the energy strategy was also a massive mistake. Now it's there, but 15 years too late.
 

Online wraper

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If you look 20+ years back in time, Russia was a stable country with reasonably good leadership. And since a significant part of Russia is in Europe, they made a good trading partner for goods and energy. That opportunity is still there. Again, the problem isn't Russia itself but the people who seized power in Russia and like to bring back the USSR. By now Russia could have been a great economic power but Poetin flushed it all down the drain. Partly by supporting dubious regimes as well.
Good for whom? Certainly not Russians. Country was totally crime-ridden and drowning in poverty. Russians literally call that time "Wild 90s". President was a barely speaking alchoholic who sold out his country to whoever he could. Huge external debt, and therefore external control from IMF and friends. So called oligarchs were stealing remains of government property that were not stolen yet (everything was government owned in USSR). Two wars in Chechnya where Russia fought with basically a terrorist local government within its own borders, while West was crying foul about that. And actually country was not that far away from dividing in separate parts even further. Not to say hyperinflation, not as bad as in Zimbabwe but still, they removed three zeroes when exchanging to new Rubles in 1998 after all. Sure Western "friends" were totally happy with that. Putin for Russians was akin of savior after that experience.
 
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Offline Siwastaja

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And saying it was "stable" 20+ years ago is quite a stretch anyway because the collapse of USSR was so recent back then, so no matter how well things seemed, definitely not stable, it was more about expectations for the future. And you can't predict the future; if you absolutely need stable supply of X, better do that with someone with a really stable long-term track record and mutual understanding of the goals of the cooperation. But then again, the cheap price probably seemed like a good deal.
 

Online Zero999

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The answer is nuclear power, as well as renewables. There's no need to ban gas heating. There will be excess energy available at some point, which can be used to make synthetic natural gas and oil.
 
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Offline Siwastaja

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There is no need to ban anything, just let the limited natural resource price be controlled by the free market and people have to pay the real price (including the cost of uncertainty), and then people will automagically start buying heatpumps and PV systems without any need to add them to any "energy strategy".

Some amount of fossil fuels are inevitable in chemical processes and natural gas is by-product in oil drilling. In a free market, these products would be cheap until some point in demand, after which they quickly become very expensive. The balance is now on the super-expensive side because they have been artificially cheap for long and normal people did never realize this.

Fossil fuels have excellent synergy with renewables, because small amounts are not a problem for climate, political stability or price, only large volumes are. So it is enough we can supply bulk of our energy needs with renewables. Fossil fuels are trivial to store in annual time scale, so there is nothing wrong burning them when it's -20degC outside so air-source heatpump COP plummets to 1, while simultaneously wind is calm so little wind power is generated, and so on. It's not a problem because such conditions are a tiny percentage of total energy use. Right now the problem is we have to burn the fossils almost all the time, even during trivially good conditions for wind/solar. We still haven't picked the low-hanging fruits.
« Last Edit: September 06, 2022, 06:32:22 pm by Siwastaja »
 
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Online Zero999

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It's only super expensive at the moment due to conflict between governments. It was much cheaper, when the West and Russia were at least civil to one another. It would be even cheaper, if there were a free market.

Obviously it will get more expensive, as resources run out, but it makes sense to switch to nuclear long before then.
 

Offline Siwastaja

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Geez. The war is not about "being civil" with each other. The war is at the core of this energy thing.

Are you really this oblivious? Do you think it is just a coincidence that there are significant natural gas resources in Eastern Ukraine, and Russia is just, by coincidence, denazifying or being "uncivilized" or whatever crap over there? Really?

No, this is classical demand and response. EU buys huge amounts of natural gas from Russia, because Russia wants to sell natural gas to EU (and elsewhere, too) -> resources are naturally limited -> get more gas, so you can sell more of it! It's no different from the oil wars of Mr. Bush at all, really.

It's really that simple. Above certain threshold of demand, the process of getting cheap fossil fuels involves war. And while war is expensive, the cost of war is never paid by the energy customers, even though the whole war really existed for the fuel.

Of course war is always decorated with some rationalization (weapons of mass destruction! denazification!), but modern wars are really all about energy, and specifically ---

FOSSIL FUELS.
 

Online Marco

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Do you think it is just a coincidence that there are significant natural gas resources in Eastern Ukraine, and Russia is just, by coincidence, denazifying or being "uncivilized" or whatever crap over there? Really?
Russia's gas reserves dwarf Ukraine's. The cost in lives, man power and economic efficiency isn't remotely worth it. Though I don't think Putin planned to bury quite this many Russians, but he's pot committed too.
Quote
No, this is classical demand and response. EU buys huge amounts of natural gas from Russia, because Russia wants to sell natural gas to EU (and elsewhere, too) -> resources are naturally limited -> get more gas, so you can sell more of it! It's no different from the oil wars of Mr. Bush at all, really.
Which didn't generate enough income for American companies to cover the cost to the American economy and also weren't about oil in the sense of gaining access to it. They were about oil in the sense of keeping Saudi Arabia happy and the Middle East functional. America world cop, but mostly doing it for free.
« Last Edit: September 06, 2022, 07:14:48 pm by Marco »
 
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Online SiliconWizard

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(...)
Of course war is always decorated with some rationalization (weapons of mass destruction! denazification!), but modern wars are really all about energy, and specifically ---

All wars in history have always been all  about energy actually, in the general sense (access to resources and territory, that's ultimately "energy" we get from that.)

FOSSIL FUELS.

If you think that's only due to fossil fuels, IMHO you'd be deluded. There will still be energy wars when we stop using fossil fuels. Maybe even more of them, as things are possibly going to get more unstable when we reach that point, at least for quite a while. We'll just displace the quest to other resources (both natural resources and human), and I doubt it's going to help much in terms of stability. Just a thought.
 
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Online Marco

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All wars in history have always been all  about energy actually, in the general sense (access to resources and territory, that's ultimately "energy" we get from that.)

Nah that's just slightly more pretentious conspiracy thinking. History for the most part gets it right, wars get started over the silliest shit. It might be comforting to think there are cabals with Real Politik reasons hidden below the surface and singular official leaders of major countries can't just have that much power to act purely on ego and ideology, but there really aren't and they really do.

Putin's article ”On the Historical Unity of Russians and Ukrainians“ really does completely explain what the war is about, it's not about natural or even human resources (additional Russians working inside the Russian economy proper is far more essential to Russia than some piddly little gas reserves or more land). Which is why it's so dangerous, because it applies to a lot of other Russified nations of the former Russian empire, among which the Baltics.
 

Online Zero999

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(...)
Of course war is always decorated with some rationalization (weapons of mass destruction! denazification!), but modern wars are really all about energy, and specifically ---

All wars in history have always been all  about energy actually, in the general sense (access to resources and territory, that's ultimately "energy" we get from that.)
Resources such as energy, land and food are catalysts for conflict but they're not the only ones. Ethnicity is a big cause of war WW2 was a classic example. Religion can also trigger war, although it's debatable whether it's religion in itself which is responsible, or it's used as a justification.

Do you think it is just a coincidence that there are significant natural gas resources in Eastern Ukraine, and Russia is just, by coincidence, denazifying or being "uncivilized" or whatever crap over there? Really?
Russia's gas reserves dwarf Ukraine's. The cost in lives, man power and economic efficiency isn't remotely worth it. Though I don't think Putin planned to bury quite this many Russians, but he's pot committed too.
The are lots of Russians in Eastern Ukraine and Crimea. The war is about ethnicity, not energy.

Relying on others for essential resources. Is a bad thing. We need to work both on establishing free trade, putting our differences aside, was well as becoming more self-sufficient.
« Last Edit: September 06, 2022, 08:14:05 pm by Zero999 »
 

Online magic

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For centuries, south-eastern Ukraine was a wilderness made unlivable by regular looting and slave hunts by various nomads and peripheral puppets of the Ottoman empire. Ukrainians were the first civilized people to set their foot there, Russians were the first to end the looting and actually civilize the region. It's been a never ending conflict ever since. Natural resources surely play a role, but likely aren't worth it alone and AFAIK it's mostly coal and iron, not gas. I see no reason to disbelieve Putin when he says that strategic military considerations were the primary trigger of the current war.

Anyone who thinks that Putin is unpopular in Russia should read wraper's post. That's what the collapse of the commie block looked like and people weren't happy about many things that happened then and many aren't still. Most everything originally nationalized by the commies (i.e., just about everything) was stolen by corrupt officials and sold for bribes to Western "investors", who subsequently shut down whole companies because they weren't all that efficient and it was the time of the great outsourcing to China anyway.
 
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Offline Nusa

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It works both ways. Europe will have to make do with shutting down industries and rationing energy to citizens until they build up sufficient infrastructure to be dependant on imports from other countries. You think their newfound dependance on LNG from the USA is the best solution? Same problem, different country.

Similarly, Russia is learning to survive without western technology, but they have enough for the short term. They'll be reviving local development and getting stuff from China and Iran. But they've no shortage of energy, so nobody is going to be cold or shut down this winter for that reason. Ditto food production and many other resources.

We'll not get into how dependant the USA currently is on China as a trade partner...the current effort to revive chip production in the USA is very telling.
 
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Online themadhippy

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Quote
Russia is learning to survive without western technology,
surely you mean relearn,as they did during the cold war
 
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