MSE Leaders' Debate: Energy Bills

Former_MSE_Wendy

This thread is specifically to discuss the Energy Bills question in the guide:

Energy Bills: MSE Leaders' Debate

To discuss or ask a question about the guide: click reply

Pegase

Disappointed that Labour is the only one to mention tenants.
Landlords have zero incentive in providing better insulation right now since they don't pay the bills (especially at the lower price end of the market where tenants don't have the luxury of being choosy), and the poorest people don't own their house but rent (in London not just the poorest, many are already forced to share accommodation even on average incomes, especially single people).

Even councils are useless at doing anything about something as basic as double-glazing.

The very first thing I'll do when I buy, hopefully this year, is getting double-glazing if it's not already there.. I'm sick of spending a fortune sending the heat out the window! (the fact most places stupidly have heaters right underneath the window doesn't help!)

KimYeovil

Ever heard of 'curtains'?

Chipping

The Tories & LibDems seem a little vague about who will pay for the "£6500 entitlement" or "£10000 package". Apparently it will be paid for out of the saving on energy(?!). This means:

1) Householders bills will not reduce significantly following the work. So householders will be motivated to do this solely to save the environment? Then the following points arise:

a) If a householder can pay for any of the energy efficiency work themselves, that means they can benefit fully from the lower energy bills. Therefore, poor people's energy bills will not reduce but rich people's bills will. And, as this energy efficiency industry builds up (as the Tories propose) the prices for this work will reduce, making it even cheaper for rich people.
b) If a smaller energy company that does not offer these entitlements/packages instead offers cheaper prices to householder, will the householder ever go for the energy saving work? If not, then it is another waste of millions of pounds of tax-payer money setting the scheme up.

2) If I understand it correctly, the energy companies or banks that pay the £6500/£10000 will be paid on some regular basis after the work (from energy profit). This means:

a) If the energy company pays for the work to be done; it will not be viable business for them, because they will only earn a small one-off profit from the work being done, after which, they will earn less profit forever from lower energy consumption. Unless, they charge the householder a monthly charge for a number of years, which means, it would effectively become a loan the householder has taken out. In this case, the householder will also be tied to that energy company for many years.
b) If a bank pays for the work to be done, and then they are paid a regular payment by the householder, it would then be just an ordinary loan.
c) If a bank pays for the work and the energy company pays the bank a share of its energy profit (and not the householder), then the energy company is effectively taking a loan from the bank. Then the energy company will pay for that loan through higher energy prices, and will also likely tie the householder into a lengthy contract for this purpose.

So, to summarise, the householder gets:

- some nice energy efficient stuff installed and feel good about saving the planet
- a lot of hassle and lost earnings while workmen are in their house doing the work
- no reduction in energy bills
- a lengthy contract with one energy company, guaranteeing the high energy prices (& maybe poor service) for a long time

The important things to remember with these Tory/LibDem "everyone wins" plans is that a) banks only provide money for a return/profit, and b) energy companies will not do anything that will reduce their profit, this includes schemes that reduce usage of energy (their product) without hiking prices up. In recent years, energy companies have already hiked prices artificially to ward off the loss of high profits due to reduced use of their product due to energy efficiency (and then pretended it was due to fuel prices or supply problems).

Somebody will pay for this new energy efficiency work, one way or the other, and guess who it will be? Yes, YOU :santa2:.

A S*** Doctor's job is to make you think you can have something for nothing. Ofcourse, from past experience, they go mad just before an election and there's little likelihood anything promised will actually be actioned after the election. (BTW I'm not suggesting to vote New Labour, they had the best S*** Doctors - people are STILL voting for them )

The_Rock-man

Ok I know you think Chipping that there be no saving to be made but this "Tories & LibDems seem a little vague about who will pay for the "£6500 entitlement" or "£10000 package". Apparently it will be paid for out of the saving on energy(?!)."
Method is already used in Germany www .newscientist.com/article/mg20527532.600-insulation-nation-cutting-the-cost-of-cosy. html. <- your have to fix link though
For most measures the savings will pay for the improvement in less than 5 years (according to article and this is based on UK so a simple way to do it to spread the repayments over more than 5 years), though the repayments etc should be tried to the building not the owner (to make it fairer).

Tigggger

Nick Clegg says "It is crazy that energy companies charge you less for your energy the more you use."

Er that's how our WHOLE economy works, the more you buy the cheaper it is.

mattcanary

The Rock Man - you are confusing amount of electric used with the unit price per unit used.
Chipping is saying that it is the latter that will be increased. And have to say I feel that will happen as well.

OldIron_2

The way I read the Cons plan is that the finance for the changes is effectively a loan seems like more or less anyone can bid to do the actual work. The repayments made out of savings - and right from the start, the customer gets a share of the savings. You may even be better off with the loan than paying upfront (by saving up for it) - once the work is done, you reduce your outgoings.

The basic plan looks quite sensible to me, although its likely to be administered by (local?) government, so I'd be surprised if it works anything like as smoothly as presented.

The part that bothers me is the numbers. Average energy bills are nothing like that large - mine is a fair bit less than this £1000 claimed "average" (for a large detached house with 5 people, which is certainly above average). Its not that well insulated either. Out of some savings on that (10%? 20%), you are supposed to finance £thousands: I hope the interest rats are subsidised!