Development Director at Buckinghamshire Community explains impact of energy price caps

The recent announcement of a price cap on energy bills has sparked discussions about its implications for consumers and the energy sector.

Amid the cost of living crisis, the public is deeply concerned.

Offering her expertise, we spoke to Kirsty Shanahan, Development Director at Buckinghamshire Community Energy, to hear her insights on the price cap announcement and its potential impact on households and the energy industry.

Shanahan gave her stance on the impact of the price cap, strategies for reducing energy consumption, and the long-term outlook for the energy crisis.

She started by clearing up, what she claimed were misconceptions, saying: "The number that is quoted in the media is not actually people's bills. It's very much based on a generalized household spend." She clarifies that the price cap applies to default tariffs and highlights the importance of considering actual energy usage, stating, "It's really about what you actually use. So really the best thing you can do is reduce your energy use."

Shanahan dispels the notion that energy suppliers make substantial profits, explaining: "The people or the companies really making a lot of money from the energy price rise are the gas and oil companies, not the energy suppliers." She emphasizes the intricate layers in the market, stating, "There are actually quite a lot of layers between the people producing and making loads of profit and our energy suppliers that actually bring the energy into our homes."

Shanahan elaborated on the challenges faced by energy suppliers due to the price cap announcement, stating: "Wholesale prices have come down. But a lot of energy suppliers have actually bought energy in advance on the higher prices from last year... When the cap comes down, their profits go down, and their margins are already quite squeezed."

She expressed concern over potential company failures, noting, "We might see a repeat of what happened last year with a lot of companies going bust."

To address rising energy costs, Shanahan offered advice: "The key things for cutting down your energy use are to think about how you use it and look online. There is absolutely tonnes of advice." She recommends measures such as insulation, efficient heating systems, smart heating controls, and switching to LED light bulbs. Additionally, she suggests using appliances during off-peak hours and adopting energy-saving habits like taking shorter showers and boiling only the necessary amount of water.

Shanahan discussed the geopolitical factors impacting energy prices, saying, "Until we have our own energy supply, we're never going to be safe from these kind of fluctuations because at any time, those countries who control oil supply can decide to reduce supply." She advocates for renewable energy solutions, stating, "The safest thing for anybody to do is get solar panels... Do everything you can to get away from gas because that is the thing that we do not control and cannot control."