Wholesale energy: what's going on and why it matters — Bulb Community

Wholesale energy: what's going on and why it matters

edited October 2016 in From the Blog

imageWholesale energy: what's going on and why it matters

Wholesale energy costs make up around 40% of most people’s energy bills. With fluctuation on the wholesale energy market we thought we'd go into more detail

Read the full story here


Comments

  • All the more reason to offset forthcoming prices by not going above 20 (evenings/mornings - 19 during the day if you're in, zilch if yo're not) with the thermostat, stopping all draughts, insulating where possible - and simplest of all, wearing more clothes (wool/fleece) and exercising (DIY anyone...?). Also maybe keeping one room slightly warmer for cocooning and sipping Horlicks. On second thoughts, forget the Horlicks...)
  • It'sso refreshing(sic!) to have a sensible and intelligent summary of what is happening out there. Thank you.
  • Thanks for the excellent summary. As a brand new Bulb customer (since Monday!) its so refreshing to receive intelligent communication from my energy supplier. An experience I've not had before..........
  • edited October 2016
    willmow if you're interested in heating efficiency you might find this worth reading.
    http://www.isoenergy.co.uk/more-information/weather-compensation-for-heating-controls

    Traditional thermostats are inefficient and outlawed in Germany and Holland, where weather compensation control, based on an outside temperature sensor, is mandatory. 15% better efficiency is the figure normally quoted.

    I can't prove that figure but I installed one for our boiler about 3 years ago. it cost fifteen quid, took half an hour of DIY and we've been perfectly comfortable ever since, without a thermostat. It does require a boiler with the correct capability, of course, but many have it, though most installers prefer to sell expensive thermostats in this country.

    The link above gives an outline but google can provide plenty of descriptions and threads to fill in the details.

    Separately, you should also read up on the dew point of water and ensure that your condensing boiler is actually condensing- it seems most leave the factory with the temperature set too high for maximum efficiency.
  • Thank you for the explanation of the present situation. Especially appreciated as we are also new Bulb customers! JonJames
  • Well explained! Like a number of the other comments I too am a new member. Well explained!
  • If you believe there is an increasing risk of rising wholesale energy prices
    wouldn't it be a good idea to now consider offering a fixed price product?
    Otherwise extremely happy with bulb, the light at the end of the tunnel.
  • edited October 2016
    Great to see that you're all finding it useful.

    That's a very smart suggestion @corvus. I didn't know that thermostats were outlawed in other countries. Very interesting. And 15% efficiency is pretty huge too.

    @eimhinderoistegreen we're not a fan of fixed prices. And, to be clear, this isn't a precursor to us raising our prices. We'd always give at least 30 days advance warning of that.

    Fixed tariffs don't let us be smart when buying your energy as we'd be required to follow more rigid regulatory requirements, which mean we can't get the best deal when we're trading our energy. Plus we keep our prices as low as we can, so we won't increase them at all if we can help it. If it did become necessary to increase our prices having fixed tariffs might be untenable and impractical for us.

    Essentially, fixed tariffs would mean that we'd have to have higher prices during the good times to compensate, which goes against our philosophy of always offering the best prices we can.
  • Hi Will

    Thanks for the reply. As I'm sure you are aware prices can be fixed by buying futures contracts in the energy market which allows you and your customers to hedge against price rises in the future. I don't see how this prevents you from using your industry knowledge to buy these contracts in a smart way. I do understand that this would likely require you to meet regulatory requirements from the financial conduct authority and possibly ofgem and there would be costs associated with meeting their regulations. Your business model no doubt has worked a treat in falling commodity market environment and the current relatively stable situation. I regularly get calls from providers trying to beat your price and it hasn't happened yet so you are certainly working the current conditions well. A futures contract and a fixed price tariff would not oblige you to charge people more during the good times nor does it prevent you offering the best prices possible as a fixed price deal in a rising market could quickly and clearly become a good price. You're live market traders are clearly good at their job you should consider preparing a futures trading desk as there is one thing that can be guaranteed market conditions are dynamic and will change. Best of luck and my the trade winds continue to be at your back.
  • edited November 2016
    Not sure how Bulb generate their "renewable" energy, but seeing that Electricity is 100% renewable I thought wholesale energy prices should not affect us at least on Electricity side of things. Gas of course is primarily imported and hence subjet to market conditions. The question is if we are importing our "renewable" energy from abroad, which means we are also affected by currency fluctuations?
  • @openmind The price of renewable energy is very heavily influenced by the price of non-renewable energy. If the price of fossil fuels goes up, those who otherwise use fossils end up buying renewable sourced energy because it's cheaper, relatively.

    This is good news for the planet though. Higher demand for renewables means more people will invest in renewable power and so the total fuel mix of the planet will be less carbon heavy.
  • I like the way you explain things. This a hell of a lot more than any other supplier that I have dealt with. Keep up with the info Regards Wooddy
  • Cheers @wooddy1943, glad you like it! We'll keep it up.
  • Thank you for yoursupport ..Do I get to be a scribe now????????
  • Hmm, one more post should boost you up to a scribe I think @wooddy1943!
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