Can someone please explain this to me? Because I can't understand it...

[pastypam]

Hello - not to sound daft but it's been wracking my brains the past few days and I've asked others and they all also say they don't know...

I'm sure we've all seen the headlines about engage firms such as British Gas and shell making billions in profits in the first half of this year...
SO WHY IS OUR ENERGY PRICES STILL RISING ASTRONOMICALLY???
My poor mother today, received a letter from British Gas saying her monthly direct debit of already £116 a month is going to increase to £283.00 a month ... they have a wood stove so they never have their central heating on and both work full time and their is only two of them living in the bungalow.. it's madness!!
Like many of us, we don't get any help because we work full time, but, in line with inflation currently and virtually everything going up in price I barely break even at the moment! Yet we're forgotten about. I understand we are getting £400 credited to our accounts but, firstly, that's actually our tax dollars being paid back into these energy firms as a piss in the wind attempt to help us... which I'm sure we'll end up paying for down the line anyway.
And I've heard murmurs that, that credit is only applied if you go over your usual usage amount.... ?

I'm so lost as to what our government is doing?? This country seems like it's going to absolute pot!! And nobody's doing anything .....

And why if they're making such huge profits are we still paying through the roof! I'm genuinely terrified for winter. It's not only a case of keeping things in your own household together, but if people have to make cuts that starts with spending money on things considered a treat.. restaurants, cinema trips, retail stores.. which then results in redundancy's ... there doesn't seem a clear route out of any of this to me.. it just seems like those at the top are ignorant to what's happening down below.. because where does this end? People are already on the brink and it's set to get much worse.

Government privatised the energy industry and let almost anyone start an energy company. Needless to say many went bust and others make a lot of profits for shareholders.

Nationalisation might be an option, then Government runs it as a non-profit... but if there is just one supplier then there is no market, so would energy prices still be high?

I have a fixed rate plan at the moment. When it expires, the current estimate is that my cost will multiply by 2.6, so £500 becomes £1300.

Does Government know what the solution is... I'm not sure they do. I wonder if anyone knows.

They claim this is what it costs now no one is willing to call them out on it

Shell, BP etc extract the oil so benefit from rising energy prices.

The retail energy suppliers themselves don't. In fact, the reverse is true and around 30 have gone into administration in the last two years. One of their main issues was having to sell energy at a loss to people on fixed price contracts as wholesale fuel prices have risen so much.

Ultimately oil and gas prices are set by global supply and demand. OPEC countries also manage supply to keep prices at high levels. Russia's invasion of Ukraine exacerbated supply issues, along with various unforeseen outages in certain countries. This also corresponded with a bounce-back in post lockdown demand for energy for manufacturing, transportation etc. Increased demand plus restricted supply = higher prices.

In other words, it's not the fault of U.K. home energy suppliers.