"Supplier costs and margins" probably should take a fair bit of the blame too.
When Thatcher privatised the UK energy industry to make it "competitive", they basically created an entire complex web of middlemen. The systems they use to communicate is enormously complicated, still kind of stuck in the 90s (think CSV over FTP), and would be basically unnecessary if it were just one company.
Ok in fairness electricity makes more sense to privatise than water or railways - at least you can choose where to buy your electricity from, within reason.
It does kind of make sense to have a market for the "generation" side with all the different types of power source that exist now. But the infrastructure is privately owned? That's crazy. Like privatising the motorway network!
They did try with the railway network (Railtrack) which was subsequently renationalised and only the train operating companies being private (and even they, like electricity generating companies, are often state-owned by other countries...).
Handing an entire national network monopoly to a single company is foolish.
I remember reading in the UK papers about one of the first water companies to privatize. The very first act of the board was to vote themselves a BIG pay raise.
Out of the £1700 average annual bill, supplier profits are £43...this is significantly higher than has been the case normally because of the volatility in energy prices. This return is also controlled by the regulator.
For scale, the cost of government subsidies is £183.
Predictably the first thing the incoming government did was: announce massive new subsidies, and create a state-owned energy company.
Network costs have also gone up because of the well-known problems with performing work on any kind of infrastructure in the UK.
The politics are part of the reason why costs are so high. We constantly rotate through insane policies that relate to the fever dreams of a lawyer. The reason why prices are high is because we have policies in place to increase prices. Companies are not making big profits (again, their returns are controlled by the regulators). Look at share prices, collapsing in the sector (unless they are getting government money).
You're mixing up two things. Suppliers (middlemen) aren't making any profit because the government has capped prices. They literally can't. But even when they could they didn't make that much profit because there's pretty good competition between them because consumers can choose.
The issue with suppliers is they are spending a ton of money dealing with complexity that shouldn't exist, so even though they aren't making a profit they're costing you unnecessarily.
The people who are making a profit are DNOs. Totally different thing.
It's an interesting rathole to go down. On the one hand, there are private equity firms buying power stations and deliberately turning them off to reduce supply, knowing that National Grid will call them in a few hours paying them an even higher rate to turn them back on... but also those operators get detected and, months later, fined out the wazoo by the regulator for pulling a stunt like that.
Also, electricity isn't any less of a monopoly. You can choose your supplier, but they do no more than administer your metering and billing (including the government insisting they install smart meters). Your house is still connected to the same domestic grid as everybody else, and it's National Grid plc that is selecting who's generating and when, and getting paid for it.
They aren't deliberately turning power stations off. We have a renewable system so when those sources aren't generating then we need gas.
All the BBG article proved is the inherent problems with the system that we have. Rather than anyone being blamed for creating that system, rather than anyone being blamed for regulating that system, we get the same politically-motivated nonsense about "evil companies"...this is why we have high electricity costs. There is literally zero political incentive to lower them and, as we have seen, very high political gains from proposing fictional solutions. Guess what? We are still going to be in the exact same place in a few years because we haven't changed the thing causing this (over-reliance on renewables).
https://www.theguardian.com/business/2022/nov/20/unite-union...
"Supplier costs and margins" probably should take a fair bit of the blame too.
When Thatcher privatised the UK energy industry to make it "competitive", they basically created an entire complex web of middlemen. The systems they use to communicate is enormously complicated, still kind of stuck in the 90s (think CSV over FTP), and would be basically unnecessary if it were just one company.
Ok in fairness electricity makes more sense to privatise than water or railways - at least you can choose where to buy your electricity from, within reason.