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Why are UK electricity bills so expensive?

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Re: Why are UK electricity bills so expensive?

#151

Post by dnissley »

bpodgursky wrote: post #121
a2tech wrote: post #57

Earlier quoted context omitted.

In a historic home in the Midwest a single month in the depths of of the winter could easily be 700-800 usd.

This is an extreme outlier. I have a 4,700 square foot home in the Midwest, electric heating (heat pump + backup direct heat) and only occasionally hit $300/mo in a cold spell.

My first house was in the midwest, built around 1920, and had plaster walls with no insulation. It was only around 1400 sqft, but we did have (natgas) heating bills in that range ($600-$700/mo December through February).

Re: Why are UK electricity bills so expensive?

#152

Post by deergomoo »

jillesvangurp wrote: post #89

An important reason that power is expensive in the UK is that it doesn't use zonal pricing and is effectively not giving the right price signals to consumers of power to move closer to where the cheap power is (e.g. data centers) or to conserve power when power is expensive; or producers of power to invest in power generation closer to where the power is scarce and expensive. Another point to make is that the nationa…

> Greg Jackson from Octopus (who are the largest energy operator in the UK) has been calling for this for some time. I don't live there but his name comes up a lot in several of the clean energy podcasts I follow. Smart person that has a lot of sensible things to say on this topic.

I've got a lot of time for Octopus, which is an odd thing to say about a utility company. It's amazing how much of a difference it can make when a company makes it a. pretty easy to speak to someone when you have a problem or question (especially via email) and b. getting that problem sorted or question answered isn't so arduous you want to jump off a bridge. It once took me six months to convince British Gas to actually start charging me for my gas and electric.

Plus every time there's a price cap change or something out of the ordinary going on, they send out emails explaining it in plain English (including, as you say, reiterating the case that our pricing model is utterly daft). They also have an API for customers so you can pull your usage data, which is pretty neat.

Re: Why are UK electricity bills so expensive?

#153

Post by greenavocado »

Xelbair wrote: post #134
monsecchris wrote: post #115

Earlier quoted context omitted.

It’s so insignificant that at best we might delay the climate catastrophe by a few seconds

People might not like this, but that's true. as long as non-western countries keep polluting - even if we achieve net-zero nothing will change other than us feeling better and patting ourselves in the back.

Drinking game. Drop Google Street View anywhere on the territory of India. If there is a trash pile visible, take a shot.

Re: Why are UK electricity bills so expensive?

#154

Post by Maken »

louthy wrote: post #21

> The UK has achieved the fastest rate of grid decarbonisation among advanced economies. A lot of this progress occurred when renewables were still expensive, so we are stuck with a cost hangover. Luckily, renewables are getting much cheaper, so the tradeoffs in future policy are very different. A silver lining at least. I’m old, so won’t see the benefits of this I’m sure, but it’s still nice to know we’ve made some…

I would like to know what "fastest rate of grid decarbonisation" even means, because the UK is definitely not the nation with the largest share of renewable electricity production. I guess it measures how much energy production has transitioned from non-renewable to renewable sources in recent years.

Re: Why are UK electricity bills so expensive?

#155

Post by omnibrain »

jillesvangurp wrote: post #89

An important reason that power is expensive in the UK is that it doesn't use zonal pricing and is effectively not giving the right price signals to consumers of power to move closer to where the cheap power is (e.g. data centers) or to conserve power when power is expensive; or producers of power to invest in power generation closer to where the power is scarce and expensive. Another point to make is that the nationa…

It's exactly the same in Germany. In addition the state government of Bavaria in the south east does everything to keep wind power from being built in their state and worked against high voltage power lines to bring cheap and abundant energy from the north to his state.

Re: Why are UK electricity bills so expensive?

#156

Post by Nextgrid »

jnsaff2 wrote: post #122

Here's a controversial take: electricity is incredibly cheap for the utility it provides . It is also a fairly well working market in the current system context . I witnessed this by working for an electricity related startup and by doing all the math involved it was really hard to make the math work out right. The possibility to optimize is there but the margins are really slim, even with the large price swings in t…

> Is it actually expensive? Could you imagine life without it?

I don't think this kind of rhetoric helps in any way those who are in "fuel poverty" (which seems to be a UK specific term, as I've never heard that in any other context) and have to choose between food or heating.

Energy is not some magic supernatural thing we're running out of. Given the right equipment it can be created out of thin air (wind and/or solar). The reason UK's energy prices are so high is decades of corruption disguised as mismanagement/incompetence, not that the absolute price of electricity is somehow high.

Re: Why are UK electricity bills so expensive?

#157

Post by singhrac »

7thaccount wrote: post #108
jillesvangurp wrote: post #89

An important reason that power is expensive in the UK is that it doesn't use zonal pricing and is effectively not giving the right price signals to consumers of power to move closer to where the cheap power is (e.g. data centers) or to conserve power when power is expensive; or producers of power to invest in power generation closer to where the power is scarce and expensive. Another point to make is that the nationa…

Zonal also has issues with congestion, lack of locational price signals, and something called inc/dec gaming. A Nodal design (like in many US wholesale markets) fixes this, but some of the key policy makers are reluctant to go in that direction as it would be a ~7 year project and would introduce revenue uncertainty in the meantime when they are trying to decarbonize and need to make it easy for developers to get fin…

Yeah, I'm not sure I understand your argument here. I work in the area. I can understand revenue uncertainty, but the solution is to sign a PPA. When Texas transitioned to a nodal market many existing generators got grandfathered into zonal pricing via free options, which is doable (e.g. any project built in the next 5 years will get this free option).

Give me an example of a "missing money" problem. I don't think these problems exist when you have capacity markets or ancillary service markets with enough incentives to exist (e.g. payments for standing offline, ready to turn on).

The big issue with UK power markets is that there is no incentive to build a huge power line down the country right now that delivers power from Scotland (where there are huge wind resources) to the rest of the country. Texas did this (very very successfully) with the CREZ.

The UK has many many competent engineers and making the energy grid more efficient is an attractive opportunity for many.

Re: Why are UK electricity bills so expensive?

#158

Post by hagbard_c »

vel0city wrote: post #36
jatin101 wrote: post #22

Commercial energy broker here - the only 2 'real' costs in your price are the wholesale and supplier costs. Choose suppliers that offer a fully-fixed electricity contract, so that made up variable costs such as distribution, network, etc are all factored into the unit rate that the supplier charges you for your contract. Avoid smart meters at all costs. Renewable / green contracts are always a lot more expensive than…

> Avoid smart meters at all costs I don't mind smart meters; it's nice getting the metrics and data from them. I do avoid variable rate billing though.

Variable billing can save you a lot of money, especially if you have your own generation capacity - PV panels, wind/water turbine etc - by making it possible to schedule maximum use during low-price (usually during the night, sometimes in the middle of the day) while minimising use during the morning and afternoon peaks. Play this right and you'll end up with negative electricity bills (in regions where small-scale producers can sell to the market, Sweden being an example of such). Contracts often stipulate that small-scale producers can not produce more kWh than they consume. By scheduling consumption so that it either falls during times of excess own production - which makes it possible to avoid paying energy taxes and transport charges or when the market rates are the lowest you end up with as low a bill as possible. At the same time you can decide to export power to the network when you happen to have excess capacity at high-price moments thereby maximising income from electricity sales. Play this right and you'll end up with net-negative electricity bills even while producing no more kWh than you consume.

Re: Why are UK electricity bills so expensive?

#159

Post by vel0city »

scheme271 wrote: post #150
vel0city wrote: post #46

Earlier quoted context omitted.

> This buyout program provides a viable pathway forward for our most vulnerable community members > Hong estimates that his home would have been worth about $3.6 million two years ago Yeah, this person who was able to afford a $3.6M home sure sounds like "our most vulnerable" people. He needs a bailout for making a poor decision on buying that house in a place prone to landslides. Not the hungry kids in our schools w…

That 3.6M million dollar home might have been worth a lot less before asset appreciation happened. There's quite a few people living in expensive areas that bought homes 20-30 years ago when it was dirt cheap, the place became popular, and now they're a teacher or something who owns a multi-million dollar home while living on 80k a year or something.

The article also mentioned their home was a new build and they moved in a few years before this happened.

But sure, keep telling me their new mansion on quicksand needs a bailout and they're far more needful than hungry malnourished kids.

> now they're a teacher or something who owns a multi-million dollar home while living on 80k a year or something.

TBH, if their home is now worth millions, they should retire and move someplace cheaper. The market is telling them that land is worth way more than a lifetime of their earnings. They should capitalize on that. They're still far weather people that he vast majority of Americans, and probably the top 0.001% of people on Earth. That they failed to cash their lotto ticket in time before their mansion on the quicksand fell apart leaves me zero sympathy.

I wish I could fail at cashing in my $3.6M lotto ticket I bought for relative pennies. At least I would have been given the chance, no?

Re: Why are UK electricity bills so expensive?

#160

Post by Hamuko »

Aachen wrote: post #99
graybeardhacker wrote: post #64

The graph shows the price for 3100 kWh. I'm not sure if that is a very low annual amount or a very very high monthly amount. The average US household uses 10,000 kWh annually ~833 kWh per month. So I'm guessing most Americans reading the article and looking at the interactive graph are thinking either: this is very cheap or very expensive, depending on whether they are assuming it's monthly or annual. In the US the a…

We're at ~3.6 MWh in a ground floor apartment with 2 adults, with water heating (e.g. showering) electric but building heating on gas (though we use a space heater a lot as well, probably to the tune of 0.2 MWh/year)

I wonder if I should feel bad since I'm currently at 2830 kWh in 2024 for a single household with all heating costs not coming out of my electric bill.
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