Re: energy in UK

On 4/26/2025 5:24 AM, Martin Brown wrote:

I don't understand "The wholesale cost is set by the last unit of
electricity needed to meet demand from consumers".  Surely, this isn't
the ACTUAL cost but, rather, the PRICE.  Is there some silly policy
that is creating this misrepresentation?

>
It is the amount you have to pay the last (most expensive) fast gas turbine to come online to meet demand.

>
Yes, but the electricity consumed (sold) prior to that was produced
at a LOWER cost.  Does EVERYONE suddenly pay more (for electricity
already made available at a lower cost) when the utility has to draw
on rapid response resources?

 The box shifting middlemen who sit between true electricity producers and the consumers have to pay more. For them to stay in business they have to make a profit and the price they pay for wholesale electricity is determined by the most expensive component at any given time.

So, it's similar to a demand tariff, here -- the price ou pay for
ALL your energy is based on your *peak* rate of consumption.  I.e.
there is little incentive for you to conserve if you know your peak
is (or will be) higher than your current RATE of demand.

Consumers can choose to be on a variable tariff that tracks gas price but most lock their price in midsummer to a fixed term contract. Likewise for businesses. After Ukraine invasion that became impossible and almost everyone was on spot prices - better deals have come back.

I guess we all are somewhat in the dark about what our actual
"price" will be; here we have surcharges per KWHr that aren't
disclosed until the end of the billing period.  And, have no
bearing on what they will be in the next billing period (unless
you are extremely savvy and know how prices TEND to fluctuate
along with demand patterns for the customer base, as a whole)
[Yet another idea for an intelligent agent!]

The internal market between electricity "producers" counting battery storage into the mix can actually spike negative! The algorithms used are unstable and are routinely gamed by the big players.
 https://www.nextenergysolarfund.com/wp-content/uploads/2024/09/NextEnergy-Capital-Insights-Negative-Power-Prices-GB-Wholesale-Energy-Market-Sept-2024.pdf
 That is a fairly favourable review. Some of it is justified but a lot of it is paper profit at the expense of consumers and UK business.

No one wants to lose money.  And, the only SOURCE of money is the consumer
(business).  There was a bit of fear in the electricity market as solar
started to gain traction, here.  And, the shift of pricing AWAY from
production costs to distribution costs.  So, cogenerators still
had to pay for those to deliver the energy THEY generated.
When local storage becomes more feasible, I suspect the industry
will shit its collective pants; they will still be strapped with
regulations and rice constraints designed in a monopoly market!

The rendering of the chart on my machine shows no numeric associated with
the "Domestic" entries for Ireland, UK, Italy, Austria, Finland, Sweden and
Greece.  It shows no numeric for the Industrial entries for Ireland, Italy,
Austria, Spain, Portugal and Luxembourg.  Though there are scaled bars
for each of these.
>
Perhaps a browser issue...

 Weird. Old IE wouldn't show any diagrams at all. Opera & Edge was fine.

This was Firefox.

Ukraine war and Russia turning the gas taps off really set the cat among the pigeons see the second price vs time graph. The only reason that it didn't go even higher was government intervention. Obtaining enough gas during the first winter was touch and go. Lucky it was a very mild winter.

>
So, is all heat produced by electricity?

 No. Most domestic space and water heating is mains gas (which obviously is also tightly coupled to the wholesale gas price). The only people using electricity for heating either have a resistive electric fire to heat a single room they live in (quite rare now) or heat pump based CH.

So, still gas at the bottom of the pyramid.  But, at least the electricity
jugglers are out of the mix.

Our hot water has a resistive immersion heater as backup to oil boiler (mains gas isn't available where I live) even though several of the UK's highest pressure gas pipelines runs nearby.

Oil seems a throwback.  It was common in New England but I've never
encountered it elsewhere.