If you paid your power bills to my supplier, you’d have a different perspective. They saw nothing wrong in raising my direct debit by £6 a month without notification. It’s a business model based on “How can we get more income” not “How can we better serve the customer”. Last year they raised the fixed charge element in order to limit the ‘headline’ rise in the main tariff rate. A case of screw the little guy and encourage the profligate to use more gas.

http://www.bbc.co.uk/news/business-22013240

“It is unedifying stuff.”

Comments Nos. 674 & 675 sum up the inconvenient ethical dilemmas. Far too many people in government and big business have no moral compass for their actions. It will always be so – it’s human nature and one reason many people don’t give a toss about the environment that we, on CleanTechnica, care so much about.

“This is what happens when you create spurious competitive structures.” ‘Nuff’ said.

Maggie Thatcher deserves only censure. “credit”! You’ve got to be joking James.

Content value low, but lots of words….

Judging by your naive faith in ‘free’ market dogma, I’m guessing that neither of you guys have any experience of a state-run system of energy provision?

I have – both as an employee in a nationalized industry and as a customer for gas and electric, and I can tell you which works in the best interest of the consumer and which just adds extra profit margin at every stage of the ‘production’ and ‘distribution’. Greed always gets the better of privatised oligopolies/monopolies. The worst offenders in the UK are the DNOs.

http://www.eaem.co.uk/opinions/exposed-shining-light-network-controllers-hold-them-account

Nobody “needs” to purchase wholesale electricity and sell retail. That’s an entirely artificial construct imposed on us by the ‘market’ theory, which is promoted by the middlemen and market gamers who benefit from such a system. You’ve swallowed their propaganda hook, line and sinker. If this pretend market is as efficient as they tell you, why is the regulator ‘forced’ to allow excessive profits and bonus payments? Why have these energy companies been fined for ripping off the consumer?

The UK’s original electricity grid was planned, designed, built and paid for by the Central Electricity Generating Board. (creating desperately needed jobs in the process) The quickest, cheapest, safest way to do infrastructure build is central planning – it’s just a logistics thing – get over it!

The current new build is complicated by the switch to renewables and it is crucial that the job’s done right first time, but that’s never going to happen when you have dozens of competing private concerns, each fighting for their own vested interests. It’s a barmy waste of money (‘competing’ for government incentives, subsidies and favourable market rules!), the technical decision-making is an abject failure (the UK has no idea what mix of renewables, gas, nuclear and CCS we ‘need’) and it takes an eternity to get new stuff up and running. (e.g. US offshore wind)

And you think that free markets will work fine if the government keeps intervention to a minimum? – Like the ‘investment’ banking industry you mean? The neoliberal mantra has wrecked economies and bankrupted businesses around the world.

Then we need “electricity companies” who purchase wholesale and sell retail. We need multiple companies on each grid. That’s where competition should come into play.

Just like you can buy a bar of soap from any number of stores they all pay a portion of their revenue to support the road system that moves the soap from factory to shop.

This decision is very defendable on logical grounds. There is only one grid, and no company will build a second or third competing grid as to obtain a true free market. There is a defacto monopoly. This is just recognizing that a monopoly is inevitable.

When you say that one company could run the grid AND generate electricity completely ignores the market distortion that would result from it. Of course the company that runs the grid would treat its generating department with preference and hamper competing electricity generating companies. To think this company with two roles would behave itself and be neutral is pure naivity.

The situation is very comparable to the road system that is run by the government as a defacto monopoly. Transport companies are private entities that use that road system competing with each other.

So sad; Japan fails to learn the lessons of the errors in neoliberal dogma:-

1.) You’ll never create a functioning ‘market’ from a natural monopoly. The lessons of history show that monopolies are best run on a not-for-profit business model – a service to society – coordinated by municipal or state legislation.

2.) There is NO ‘conflict’ between generating and distributing electricity. It should be one and the same thing, working always in synergy, not in ‘competition’. To pretend otherwise is nothing more than ignorant ideology.

Current thinking is that electricity storage is a systems adjunct that can only smooth and balance grid operations. That’s a technical misconception, but UK legislation defines storage as a ‘generator’ anyway, so National Grid is NOT allowed to build it into the system. ‘Unbundling’ in that sense is an unworkable ‘market’ proposition.

Energy storage should be made the generator’s responsibility. If it’s located before-generator it would also reduce peaks in supply – QED. It is the only cost-effective, holistic solution and could cut gross installed capacity by half.

“the direction of these reforms is to be applauded.”

The direction of these reforms will be applauded by the oligopoly of corporations who will take the profit, and cursed by the consumers who will pay the price.