Ofgem Investigates Why Prices are Actually Rising
December 18, 2005 at 11:44 am
In theory, gas prices should be falling as we are experiencing warmer weather and supplies are good but the opposite seems to be actually happening with prices are double what they were a couple of months ago. Ofgem are concerned this is because of inadequate information from the Government which is blocking the free working of the gas market.
Ofgem are working towards getting more information from the gas producers with the Ofgem Chief stating ‘Good-quality information is the lifeblood of any market’. Ofgem does not regulate the offshore gas market so are not able to collect as much information as they do in the electricity market, however the Department of Trade and Industry has put a new voluntary agreement in place with gas producers which aims to make more information available to suppliers and consumers.
They have also had the Financial Services Authority looking at energy trader’s activities as they were concerned about how gas prices were not really matching gas supply issues but nothing suspicious was found.
Fuel Poverty
December 13, 2005 at 11:45 am
Fuel poverty described a situation when someone is spending 10% of their income just to keep themselves warm. High gas prices this winter mean that many vulnerable people may be faced with this harsh reality.
Suppliers and consumers are concerned that prices may continue to rise with high wholesale prices and a lack of supply from Europe. There is a concern that if the prices do go up as expected that elderly and disabled people may struggle to afford their heating bills. The Commons Trade and Industry committee’s report into the UK’s gas supply addressed this issue and commented that essential assistance to vulnerable groups will be required if prices do rise again.
Hospitals Could Lose Gas Supply
December 1, 2005 at 11:45 am
It has been revealed that many of Britian’s largest hospitals could lose their gas supply if we face a shortage this winter. In order to put pressure on the government over the UK energy crisis, the Conservatives raised this issue, stating hospitals could be left without gas after only 4 hours notice.
Many hospitals are on ‘interuptible’ contracts in order to keep costs down. The health service budget is put under strain by high energy prices and this type of contract offers a discount on charges. Lower bills does however mean that they could also only be faced with 4 hours notice before their supply is switched off.
Some hospitals could use alternative fuels, such as oil as a backup in the event of a loss of supply but not all hospitals have this option and would face a hot water and heating shutdown.
This is an absolute last resort and would happen only after industrial gas users have volunteered to have their supply interrupted first but could well be a reality if prices continue to rise and supplies from the North Sea and imports lessen.
