Ofgem launches energy review, but will we save cash?

22 September 2010

Gas-gas-gaaaas

Ofgem, the energy busybodies, have announced that they'll be undertaking a massive review into the costs of supplying electricity to the National Grid. They promise to be "open, comprehensive and objective" in their review of the charges. We promise to be unsure what it actually means until we get further into the article.

So what are Ofgem up to? Well, they're going to price everything up to see if they can find a way of keeping costs down. Alas, because of the 2010 Energy Act, they're going to have to recognise other requirements as well, which means, not looking at it all as an exercise in cheapery, but also, loads of rubbish about security of supply and environmental stuff.

Any ideas yet? Nope. Us neither. We're tired. Leave us alone.

The BBC reckon that this is all down to political and industry pressure to reform a charging regime which is seen as holding back renewable power development in the more far-flung bits of Britain. Basically, it costs power companies £24 to pump a kilowatt hour of power into the grid. Nearer to Britain's big cities, there's a £6 subsidy to encourage companies to site power stations near customers. That's not fair because some electricity generators get the highest grid charges in the UK.

Alistair Buchanan, Ofgem's chief executive, said the review followed Ofgem's finding that £200bn of investment will be required to move to low carbon energy in Britain.

"The electricity and gas grids play a fundamental role in meeting this huge challenge, Project TransmiT will consider whether the way in which grid costs are shared between users needs reforming."

BUT WILL WE BE GETTING CHEAPER ENERGY?

This review will hopefully find a way to lower our bills first and think about the environment second. Why? Because winter is coming and it'll be bloody cold - all the trees and plants might as well be dead throughout this period so sod 'em.

TOPICS:   Utilities   Motoring

1 comment

  • The B.
    Well, in terms of gas, the following might help: 1) Stopping the energy companies selling the gas to their European parent company cheaply when demand is low. 2) Make them invest in UK gas storage facilities (currently they sell and ship the gas back the EU parent company and have sold off existing facilities). 3) Buying the gas back from the EU parent when demand (and prices) are high, pumping it back to the UK all at ridiculous cost to the UK consumer but making the European parent company huge amounts of money. But this is a UK regulatory body so the recommendations will probably be that all companies should try to keep their prices "competitive" otherwise we'll order another review.

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