I await a defence from fair on here to say how poor these energy companies are and how they have little money.
And here I am
If your energy prices were bought in based on next day delivery prices we'd all be screwed as they rocket, and it would be impossible to give people accurate quotes as they fluctuate, gosh, I think daily? You get a quote for a year usually when joining an energy firm, not for the cost tomorrow. Why do you think that is?
they use long term indicators because that's where it's expected to be given they will need ongoing supply, you can't just buy all the gas to arrive tomorrow and keep it in the garage until it's needed.
Without storage, which our government cleverly allowed to be taken away, this is the equivalent of kicking off about bread prices going through the roof at winter when there is Tesco value bread yellow stickered bear before yesterday. No good if you want bread tomorrow, and you don't own a freezer.
Fully support a windfall tax on energy
generators, but too many people confuse
suppliers with
generators. The companies taking it in are the likes of Shell and BP, which you'll struggle to find any defence of me in here. The price cap was the only thing stopping those outside the big 6 from collapsing and only government intervention stopped bulb collapsing and they had to, because no-one would take on that many customers. If there wasn't a price cap, bulls would have gone up more.
The gas you are using now will have been bought at similarly eye watering future prices because they have to hedge their forthcoming supply contracts to remain in business, depending on the risk appetite of the suppliers and customer usage, some day trading will occur to plug gaps, but most of it is hedged long term as it's the only way to reduce risk and have stability. Some suppliers won't have done this effectively and will have been caught with their pants down - effectively putting customers on low deals to gain customers and relying on low rates to make their margin and as those rates shot up, they're actually paying for customers to use energy, so many have gone bust.
My energy firm, outfox, made a 2.7m loss in 2019, 750k profit in 2020, theyre hardly printing money. Imagine that's going to fall through the floor in 2021 when they file.
Meanwhile, government is still collecting VAT on the large increases in fuel and energy, and no-one complained when you were able to get the cheapest deals on u-switch/compare the market for several years due to these strategies...