MSE News: Households urged to fix energy costs 21 June 2010 at 5:04PM in Energy 18 replies 3.2K views

Former_MSE_Guy

This is the discussion thread for the following MSE News Story:

"A comparison site says, with power firms pulling their top deals, consumers should lock into a cheap fix soon ..."

Read the full story:

Households urged to fix energy costs

Paulgonnabedebtfree

So as the wholesale prices dropped a lot some while back, the prices that consumers paid only dropped a small amount. Therefore as wholesale prices have climbed a lot recently, the increases to consumers will be small - won't they?
If you detected a note of sarcasm, you're spot on.

Lilyfairy

Hi,

Just reading through various articles and threads as I'm considering changing my gas and electricity package and I must say that I'm very unsure what would be the best move. I am normally quite savvy when it comes to comparing deals etc but this has left me more than stumped! I am currently with Scottish Power - providing both gas and electric on a dual fuel, internet billing tariff. Just by chance I input my current rates etc into Uswitch and that showed that I can save over £160 by moving to one of the other Scottish Power tariffs. I have called them today and they have confirmed that I can move to one of two alternative tariffs or cap my rate. I wasn't keen on capping yet I am now considering it as a result of this MSE article on price rises..

Any advice would be appreciated! Many thanks :money:

Paulgonnabedebtfree

Yes I'm not sure which route to take either.
I'm currently with Npower.
I get £100 a year refunded to me for paying by direct debit.
That £100 is due to be credited to my fuel account on 5th July. It sounds like the fixed rates may all have been withdrawn by then though. What a dilemma.
My gut feeling is to stick around just long enough to get my £100 credited and see what's around at the time. Whatever happens, at least I will be able to get some money via a switching company. I would probably be due a refund from Npower too.

Pincher

I am working on the invention of the century for combatting fuel poverty: a wholehouse puncho. For, say £300, you get a tarpaulin to drape over the whole house. You cut holes in it for the chimney, doors etc. Tie down the edges with tent pegs or equivalent. Biodegradable, so I can sell you one a year.

I am counting on a government grant, so that poor households get a subsidy, and OAPs over 70 years old get it for free.

Are there any dragons out there?

Paulgonnabedebtfree

Pincher wrote: »

I am working on the invention of the century for combatting fuel poverty: a wholehouse puncho. For, say £300, you get a tarpaulin to drape over the whole house. You cut holes in it for the chimney, doors etc. Tie down the edges with tent pegs or equivalent. Biodegradable, so I can sell you one a year.

I am counting on a government grant, so that poor households get a subsidy, and OAPs over 70 years old get it for free.

Are there any dragons out there?

I'm out

Pincher

Intensive research and development has brought us puncho version 2:

Inflatable transparent skin for the house, in customisable patches.
You link them by snap fit air tubes. Plug a rubber dinghy pump into one section, and inflate on cold days. When it gets warm, reverse pump action and suck the air out.

Green house effect warming, double glazing insulation, no carbon emissions. I have just saved the world.

Extra rain proofing, retain house exterior look, so suitable for conservation areas. Have a cold 500 year old castle, hard to heat? Pincher Poncho 2, you know you want it.

oakhouse13

Worth remembering that the likes of Mark Todd make their living from switching and give predictions as often as Russell Grant does. Todd and his like pick up commission whether their advice saves or costs you money. All Todd has to do to make money is persuade you to take a risk by appearing to know what will happen in the future. It's what salesmen do. Millions switched in 2008 to inflated capped prices on two year contracts and lost money as prices fell. The switching services that profited from predicting two prices rises in 2008 have not had to pay back the commission they made on incorrect advice. In fact once people realised they were stuck on too high prices they were game for another quick commission.

Do we need the disastrous incentive of commission that transfers risk to individuals, some of whom are vulnerable, driving prices for gas and electricity which people need to stay alive?

There's also the lack of transparent prices that is contributing to price discrimination.

Do you want to cut out commission, sales, marketing and for the standard price to be where competition is? The big suppliers are preventing this through price confusion. If standard prices were transparent and comparable across the suppliers, the price everyone pays would fall faster than having to rely on a computer or an algorythm or a price comparison salesman. Lack of transparency is causing different customers to pay higher prices, an outcome that may be acceptable in some markets but is undesirable in energy markets. The customers with the least bargaining power tend to be those with the least ability to pay.

There's also the cost to the tax payer who is left with trying to bring some equality to prices distorted by a few middlemen pocketing millions in commission.

Premier_2

How has gas wholesale price increased by so much recently?

A couple of years ago when the price of oil went through the roof (hitting abot $150 a barell) due in the main part to the actions of speculators, we were told that the wholesale price of gas in Europe was based on the price of oil, hence justifying the 50% increase that year (the approximate total of the two separate increased that occurred).

Today, the price of oil is no more than $79 a barrel up from a recent low of about $69 a barrel (a max increase of about 15%). Yes, exchange rates affect this, but the exchange rate has worked in our favour if anything over recent weeks strengthening slightly over the USD (Was about 1.44 now about 1.47)

As at least one other has also pointed out, despite the price of gas jumping by 50% when the price of oil escalated, now it's back down to where it originally was, retail gas prices have only decreased by about 10%.

Finally, if there is no premium to be paid on a fixed price deal, the chances are that the energy companies don't think prices will be increasing any time soon.

Pincher

We seem to be moving towards the same blackout scenarios that California ended up in. There was plenty of electricity generating capacity, but speculators like Enron had bought up the energy contracts. On the day, spot price is sky high, and California used up its annual emergency budget in a few days.

davidgmmafan

Paul NPower have a tariff called GoFix2 which is fixed, depending on your consumption it may only be slightly more than the current online tariff...

Nobody knows what will happen with prices but re commission use a cashback site and get the 'commission' for yourself.