Why has the energy price cap gone up when gas prices are falling? - Yorkshire Post Letters
From: Terry Riordan, Ottery St Mary, Exeter.
The recent rise in the energy price cap, and therefore our bills, is unwelcome. The rise was caused by gas prices, which may seem strange when the price of gas is falling and the nay-sayers are trying wrongly to blame renewables.
The detail of the energy price cap is hard to get your head round, but it’s based on the cost of energy in the preceding quarter, not a prediction of future energy prices, because these are too volatile. Gas was definitely the culprit for the rise.
Money-saving expert Martin Lewis provides his advice to consumers on what’s the best deal for them, based on the incredibly accurate predictions from Cornwall Insight (a highly regarded company providing independent research and analysis in the UK energy markets).
They’re the experts and tell us that “It might be tempting to look at rising bills and conclude that the push towards renewables is not working, and we should scale back on the transition. But the reality is higher energy costs only reinforce the need to accelerate our expansion of clean, reliable energy across the UK”.
Our electricity prices are currently based on gas prices that are dictated by supply and demand issues. Imagine how high the cost would have been if we had been without renewables, and gas had needed to deliver an average of over 68 per cent of our electricity, rather than the actual 30 per cent over the last year.
We can also do better because there are times when renewable energy is wasted as we don’t have the grid capacity to deliver the electricity to where it’s needed. Thankfully, solutions are in progress with recently added energy storage and transmission lines under construction.