FionaK |
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| A wee update on one aspect of this, which I had missed. What I wrote above was my best guess about how all this would work and one of the things I was not convinced about was that the costs of these bulk buying middle men would be less than the savings they can generate. Turns out we don't have to guess about this. It is comforting that the conclusions you can draw just by thinking about it have some basis in what actually happens: so long as you are not a starry eyed naif like Ed Milliband Private Eye reports that local authorities have already been encouraged to adopt this practice. Groups of councils get together in just the way described to buy their electricity in bulk and they use an agency to do it. One of those agencies is called "Laser" and it was set up by Kent county council. Laser buys electricity on behalf of 120 councils and other public bodies so it spends hundreds of millions of pounds. If the theory is right they are in an ideal position to get these savings. In reality Laser's head of procurement was sentenced to 7 years in prison for fraud. It seems he got "management fees" from the energy suppliers, as well as his wages etc from the purchasers he was acting for. To the tune of £2 million. Which found its way into his private bank account, somehow. When asked why his company was paying fees to a customer a Centrica spokesperson is reported to have said that Management Fees are standard industry practice. What do you imagine they are paying them for? So they can keep the pricce to the absolute minimum, presumably, in the free competitive market we are told support this nonsense. Or maybe it is to ensure the business comes their way regardless of the price? You decide. www.bbc.co.uk/news/uk-england-kent-17937293 |
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