. However, the energy retailers, the companies who buy energy for their customers on the wholesale market, don't make a huge amount of money in any typical year. In a good year they'd make £25 per customer for a gas and electric contract, for a whole year. They're already making a loss at the current SVR tariff because the wholesale price has jumped even further ahead of the capped price, at least for the UK. The anger is directed at the wrong people and risks further collapse of the energy retail market and higher costs for all.
EDIT, Website I got Centricas profit from, missed out the decimal point, thought 134 billion was a bit high lol, should be 1.34 billion.
Trouble is, a lot of energy providers set themselves up with no real safety net, no real regulations, undercutting others, convincing people to switch to them.
Now, if I’ve read correctly, the reason the daily charge has approx doubled is to claim back the money it cost to take over those failed companies. Many directors etc of those failed companies, happily made hundreds of thousands and we are now paying the cost.
26 companies went bust from Aug 2021 to Dec 2021, compared to 23 companies going bust between Nov 2016 to Jan 2021
According to the FT a few days ago, “The cost to UK households of bailing out nationalised energy retailer Bulb is expected to soar to more than £4bn by the spring unless the government achieves a sale, saddling every home with an additional £150 or more on its bills next year”
From Bloomberg:
“ The owners of some UK energy suppliers that collapsed within the past year are set to walk away with payouts reaching tens of millions of pounds at the same time every household in the country is footing the bill for those failures…….
…
The People’s Energy Company Ltd. came into being with crowdfunded cash and a pledge to tackle fuel poverty in Britain. Four years later, it failed. Even so, founders David Pike and Karin Sode may receive about £50 million once company creditors are satisfied. In addition, they won’t be on the hook for the £283 million cost of shifting their customers to Centrica Plc’s British Gas.
…
It’s all legal, and shareholders of other bust utilities may be compensated, as well. Around 30 energy suppliers in the UK have disintegrated since August because they couldn’t afford electricity or natural gas”
Sure some energy suppliers have little to do with energy generation, but then you have the likes of British Gas etc, sure it could be argued they are different parts of these companies, but when you have say:
British Gas CEO didn’t take his £1.1m bonus THIS year due to soaring household costs (He’ll have to pay his bills from his £750k salary instead),
but Centrica who owns them, profits went from £262 million for 6 months of 2021 to £134 billion for the same 6 months of this year
Shell announced last month that it would return billions of dollars to its shareholders as the oil giant continued to profit from massive energy price hikes following the Russian invasion of Ukraine.
BP was accused of “unfettered profiteering” after it said on Tuesday underlying profits had tripled to $8.5bn (£6.9bn) between April and June, thanks to high oil prices. It was its biggest quarterly profit in 14 years and BP said it would hand out nearly £4bn to shareholders as a result
Power generation companies:
Eon £3.4 billion profit first half of 2022 (chief executive pay £1 million)
National grid £3.4 billion profit 2021 - 2022 (chief exec pay over same period £6.5 million)
RWE £2.2 billion profit first half of 2022. (Chief exec pay £3.6 million in 2021)
Scottish Power £925 million first half of 2022 (Chief exec pay £1.35 for 2021
Drax £225 million first half of 2022 (Chief exec pay £2.7 million 2021)
EDF £4.5 billion LOSS first half of 2022 (highest paid director £1 million on 2021)
EDF losses are mainly due to their nuclear power plant problems and other problems in France.
Bearing in mind say Eon, British Gas, Scottish Power etc are household suppliers, when someone on the England (Scotlands the same rate). min wage of £9.50 per hour, has seen the average annual gas and electricity bill rise from:
1st Oct 2021. £1,277 per year (12% rise on previous year)
1st April 2022 £1,971 per year. ((54% rise)
1st October 2022 (Latest predictions, I believe the announcement is tomorrow) £3,554 per year (80% rise)
1st January 2023 (Latest predictions) £4,650 a year (31% rise)
1st April 2023 currently estimated to rise somewhere between £5,300 and £6,550.
So someone on min wage in 2021 was paying an average of £107 a month for gas and electric
Same person is currently paying £165 a month
From October they will be paying £296 per month
From January they will be paying £387 per month
And if the lowest prediction for April 2023 comes true, they will be paying £442 a month
That’s without the fact that the poorest tend to be on prepayment meters, and are charged an extra 2% for the suppliers to have their money in advance.
And those that don’t pay by direct debit but pay when they receive their bills, have to pay an extra 7%
I’m sorry, but I fully understand why they blame all energy companies whether that company produces power or not.
I’m surprised millions aren’t out on the streets etc.
I can only afford Januarys rise by instead of being able to currently save about £200 - £300, to being able to save nothing and go into my savings (which aren’t a lot, about £3k) and when I’ve used that up, if these prices continue, I’ll have no option other than to take money out of my (not very big) drawdown pension to cover my bills, luckily my mortgage is paid, if it wasn’t, I wouldn’t be able to pay Januarys bills.
And I count myself lucky in that while annoying, while I might end up using my pension (only 58), at least I can pay it, at least I won’t be worrying about how I’m going to pay my bills etc, I don’t know how many will cope.
And of course on top of that, prices of everything else is going through the roof, food especially.