4 ms·

Why panic if you’re in the UK? They’re less exposed to Russian gas than continental Europe.

by bb123 4y ago

Barrin92 4y ago
they have virtually no storage capacity and are highly reliant on gas for heating and electricity generation, more so than the continent. Gas prices are global so it doesn't matter whether your gas is Russian or not. The UK government is already preparing to spend almost 200 billion on stabilizing prices. (that's more than the NHS and military combined).
- vba616 4y ago
  >The UK government is already preparing to spend almost 200 billion on stabilizing prices I notice public figures saying (paraphrasing) "why shouldn't the current bout of inflation be like the 70s". And I think "because they were trying to maintain the gold standard for way too long and that's what got it going?" Spending vast amounts on "stabilizing energy prices" seems like essentially the same sort of mistake. I wonder why other countries falter in emulating the Federal Reserve, which seems to have learned something from history despite all its critics.
  - bb123 4y ago
    I think the idea is to use that money to stop higher energy prices driving inflation
    - vladich 4y ago
      It's not free though, you have to either raise taxes or increase debt, both of those options have some unpleasant consequences.
jodrellblank 4y ago
https://uk.news.yahoo.com/energy-crisis-why-uk-worst-103654276.html https://uk.news.yahoo.com/energy-crisis-why-uk-worst-1036542...
brianmcc 4y ago
You'd think. But UK is less well governed: among other things Brexit has brought its own special brand of GDP inhibition. https://edition.cnn.com/2022/08/19/energy/energy-prices-uk-europe-explainer/index.html https://edition.cnn.com/2022/08/19/energy/energy-prices-uk-e... As wholesale costs ballooned last year, 31 smaller UK energy companies — who traditionally offered competitive prices — went bust, forcing millions of customers onto the books of bigger suppliers, and to pay higher bills. The way the British government designed the energy market made this more likely, Henning Gloystein, director of energy, climate and resources at Eurasia Group, told CNN Business.
- veltas 4y ago
  Brexit has got next to nothing to do with the current energy crisis in the UK: it's a worldwide problem, and even the CNN article you've cited claims it's not Brexit that's made it worse in the UK than elsewhere.
  - brianmcc 4y ago
    True but it's a factor unique to the UK adding even further to the economic woes that energy costs bring, hence it belongs in responding to "why panic in the UK?". Covid lagging impacts plus Brexit plus energy prices is all pretty grim. And now Rees bloody Mogg is the Business and Energy Minister. Sheesh...
- jbjbjbjb 4y ago
  That report missed that the issue was because the cap was designed to prevent suppliers exploiting customers who don’t switch supplier regularly to get better deals. It ended up with smaller suppliers that act as brokers to lose money in the current market. It was not a catastrophic issue.
- vba616 4y ago
  Where I live in the US, the power company is National Grid, headquartered in London. I believe that customers can select a different energy supplier, while paying National Grid for connection and delivery. So it sounds like you are talking about a similar system. I'm not sure of the state of the market, and I've never tried changing my supplier, but I do notice the electricity supply rate has more than doubled year-over-year. My understanding is that most of the power here comes from Canadian hydro, so that seems to tell you something about the usual explanations for price changes.

Why panic if you’re in the UK? They’re less exposed to Russian gas than continental Europe.

by bb123 4y ago

Why panic if you’re in the UK? They’re less exposed to Russian gas than continental Europe.

they have virtually no storage capacity and are highly reliant on gas for heating and electricity generation, more so than the continent. Gas prices are global so it doesn't matter whether your gas is Russian or not. The UK government is already preparing to spend almost 200 billion on stabilizing prices. (that's more than the NHS and military combined).

vba616 4y ago
>The UK government is already preparing to spend almost 200 billion on stabilizing prices I notice public figures saying (paraphrasing) "why shouldn't the current bout of inflation be like the 70s". And I think "because they were trying to maintain the gold standard for way too long and that's what got it going?" Spending vast amounts on "stabilizing energy prices" seems like essentially the same sort of mistake. I wonder why other countries falter in emulating the Federal Reserve, which seems to have learned something from history despite all its critics.
- bb123 4y ago
  I think the idea is to use that money to stop higher energy prices driving inflation
  - vladich 4y ago
    It's not free though, you have to either raise taxes or increase debt, both of those options have some unpleasant consequences.

jodrellblank 4y ago

https://uk.news.yahoo.com/energy-crisis-why-uk-worst-103654276.html https://uk.news.yahoo.com/energy-crisis-why-uk-worst-1036542...

brianmcc 4y ago

You'd think. But UK is less well governed: among other things Brexit has brought its own special brand of GDP inhibition. https://edition.cnn.com/2022/08/19/energy/energy-prices-uk-europe-explainer/index.html https://edition.cnn.com/2022/08/19/energy/energy-prices-uk-e... As wholesale costs ballooned last year, 31 smaller UK energy companies — who traditionally offered competitive prices — went bust, forcing millions of customers onto the books of bigger suppliers, and to pay higher bills. The way the British government designed the energy market made this more likely, Henning Gloystein, director of energy, climate and resources at Eurasia Group, told CNN Business.

veltas 4y ago
Brexit has got next to nothing to do with the current energy crisis in the UK: it's a worldwide problem, and even the CNN article you've cited claims it's not Brexit that's made it worse in the UK than elsewhere.
- brianmcc 4y ago
  True but it's a factor unique to the UK adding even further to the economic woes that energy costs bring, hence it belongs in responding to "why panic in the UK?". Covid lagging impacts plus Brexit plus energy prices is all pretty grim. And now Rees bloody Mogg is the Business and Energy Minister. Sheesh...
jbjbjbjb 4y ago
That report missed that the issue was because the cap was designed to prevent suppliers exploiting customers who don’t switch supplier regularly to get better deals. It ended up with smaller suppliers that act as brokers to lose money in the current market. It was not a catastrophic issue.
vba616 4y ago
Where I live in the US, the power company is National Grid, headquartered in London. I believe that customers can select a different energy supplier, while paying National Grid for connection and delivery. So it sounds like you are talking about a similar system. I'm not sure of the state of the market, and I've never tried changing my supplier, but I do notice the electricity supply rate has more than doubled year-over-year. My understanding is that most of the power here comes from Canadian hydro, so that seems to tell you something about the usual explanations for price changes.