For a quarter of a century, Britain had been self-sufficient in one crucial area — gas. But since 2006, Britain has been a net importer.
The result has been a decline in living standards. This decline is set to continue, probably for the rest of our lives.
Everything from cooking an egg to running a bath is set to get much more expensive. However, as you’ll see below, there is action you can take — and I don’t mean insulating your loft.
As North Sea supplies continue to fall, households are feeling the pain. British Gas last week hiked prices by 35%.
There are other reasons to be seriously concerned by Britain’s gas plight:
- We get 40% of our electricity from gas.
- 85% of Britons heat their home with gas.
- All but one of our nuclear plants will be closed by 2023 (meaning even more electricity will need to come from gas).
- Our facilities only allow us to store 13 days’ worth of gas in case of emergency. That compares with 99 days in Germany, and 122 days in France.
"Some time in the next decade we’ll all have to bow down before Vladimir Putin and kiss his feet," he says. "Because we’ll be beholden to the Russians for our gas."
One way we could avert this is by increasing our nuclear capacity. By going nuclear, Britain would drastically reduce its demand for gas.
The government has been hoping that French firm EDF would buy British Energy (BE), which controls Britain’s reactors. Last Friday, however, EDF walked away from a deal, after BE shareholders said its offer was too low.
Today’s papers tell us our government is "putting pressure" on EDF to up its bid. To me, this just sounds desperate. We need the French more than they need us. We need them to save us from dependence on Russia.
It’s a sorry state of affairs. But you can take action.
Garry’s been warning about Britain’s upcoming energy crunch for years. And he has prepared for it. He’s found several investments that look set to do well as energy prices climb.
Read what he has to say, and discover how you could profit from the upcoming energy crunch
Platinum group metals — will new technologies push down the price?.
"It’s a Catch 22," write Erin and Isabel, our Miner Diarists. Producers of platinum group metals (PGMs) want prices to go up. It means more profits for them.
But rising prices could turn out to be the producers’ worst enemy. You see, they give users of platinum — such as car manufacturers — greater incentive to find alternatives.
Several new technologies have arrived on the scene lately. PGM producers claim to be unconcerned. But as Erin and Isabel point out, they would say that, wouldn’t they?
Read this and discover the various ways car producers are trying to wean themselves off PGMs.
Until tomorrow
Ben Traynor
Editor
The Daily Reckoning — Writing to you from the Land of the Dead...
We step back in order to have a look at the Big Picture.
Hmmm....still, not very clear. So, we step back again...and again. Soon, we are so far away that we can’t see a thing!
Still, looking through the binoculars, this is what we think we see.
First, the US economy is in decline. The latest figures show it growing more slowly than the population — which means, the average citizen is getting poorer.
Of course, dear readers know the figures are not very helpful anyway. In a consumer economy, GDP growth rates tend to measure the rate at which people consume wealth rather than the rate at which they create it.
But let us put that quibble aside, at least for this morning.
You can read the Daily Reckoning in full here
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