Sir, – A spokeswoman for Bord Gáis Energy (BGE) tells us (Business, February 21st) that the recent downturn in wholesale energy prices “is not reflected in current consumer prices and won’t be for some time” because its energy traders purchase energy on the forward market up to 18 months in advance as a hedge against price volatility. It does this, she goes on, “to protect our customers”.
Could she also tell us how this reassuring activity on the part of BGE and its energy traders seemed to have no effect when prices were increasing? The strategy she portrays, if pursued consistently, should have meant that the surge in wholesale prices would not impact customers for up to 18 months. But, as we all know, that was not the case.
Can it really be the case that BGE and other suppliers did not purchase forward when prices were low but began to do so when wholesale prices went through the roof? I can just about get my mind around the thought that one of our suppliers might have pursued this interesting strategy. But all of them? Really? Perhaps they all use the same “energy trader” who is new to hedging. – Yours, etc,
PAT O’BRIEN,
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Dublin 6.