Residential and commercial power consumers are in a constant quarrel with their suppliers about the rate at which fuel bills increase each month. Despite consumers changing their lifestyle to accommodate measures to guarantee lower consumption of energy, the bills at the end of the month still won’t go down.
Energy companies are not estimating bills, the individual consumer is consuming as little power as possible yet the bill is too high leaving the average person in a state of poverty. Any salary and wages received at the end of the month tend to the electricity or gas bill in the house leaving the residential energy consumer with nothing to spare.
On the other hand, company profits take care of the huge energy bills leaving the company with little or no profits to allow growth and expansion of the company. The important question is; are increasing fuel bills the reason for continuing poor economy?
Increased Fuel Bills Effects on Demand
power prices have been hiked and the energy suppliers are hiking their rates and tariffs to guarantee some profits in these harsh economic conditions. The average income earner spends all his/ her earnings paying on paying their electricity, water and gas bills leaving no money for personal use.
The demand side of the economy is being destroyed as consumer spending power diminished in the face of increasing utility bills.
At this rate, other companies which don’t deal with energy supply are disappearing from the market simply because consumers don’t have any money to spend on these companies’ products once they have paid their power bills. The energy companies rule the market and are stalling growth, profits and expansion progress in every other sector, so the economy continues to degrade further with each day that passes. Every company not dealing with energy supply is being wiped out of business as we speak.
New companies entering the market can only survive if and only if they deal with the power supply problem.
One way is for companies to become energy providers themselves, using feed-in tariffs from the excess power that they generate to counteract any power imports that they need. With ever-increasing energy prices it makes more sense every year to invest in small scale wind turbines and photo-voltaic cells on the factory roof and walls.
No company can afford to give a supplier or group of suppliers a stranglehold over its raw materials, yet companies that are dependent on traditional power suppliers are in that very position. There is only so much that can be done in terms of reducing energy use and after that you have to pay the price that is asked or go without, unless you have your own generating capacity. Even small gas turbines make more sense than paying large providers’ inflated profits.
When enough large electricity consumers become self-sufficient power companies will have to reduce their margins and prices will fall again, but until that date the energy utilities will charge whatever price the market will bear.
Measures to Reduce Energy Prices and Rebuild the Economy
In conclusion, new businesses entering the market should evaluate how they can use alternative sources of power to give them a chance of survival in today’s economy. Established companies need to divert profits to investment in energy self-sufficiency. Politicians and their economist advisors need to stop raising energy prices just to limit consumption, before the entire manufacturing economy grinds to a total halt from the combined effects of higher power prices and reduced consumer demand.