I read an interesting letter yesterday from Ecotricity, my electricity supplier. I received it a couple of weeks ago but hadn’t opened it because i thought it was a bill!

It’s essentially a notice of price increases but instead of simply stating the new unit price, Dale Vince (Managing Director of Ecotricity) attempts to explain the global economic forces behind the increase. After mentioning the growing demand for fossil fuels from the developing world and how the rising prices are exacerbated by the futures markets, he explains why a green energy supplier should be affected at all:

I know that it can seem counter intuitive to some of our customers, that we should be affected by rising prices for fossil fuels. But until we generate the majority of our own power from green sources we will remain affected by the ‘market’ and the same is true of the UK as a whole.

The tone of the letter is really honest, and does not shy away from admitting the company’s weakness:

Our policy, indeed our promise, is to match exactly the price of the Big Six in each area, and so we need to raise our own prices. But this is not just a matter of policy and we won’t be adding to our profits from this. It’s a matter of necessity that we raise prices to match our increased costs.

For the last few months we have been absorbing significantly higher costs. Following EDF’s price increase now will allow us to restore our position. Quite honestly, we could not have gone for many more weeks without raising prices, even if EDF had not.

It’s stuff like this that makes me love my electricity supplier – and that’s probably not a phrase you’re likely to hear very often!