All homes to be put on cheapest energy deal?

pineapple

According to the news this morning, this is what our illustrious government is promising. How would this work exactly?
Would there be an annual review or would everyones payments be continuously monitored? Would people be moved automatically or would it simply be that the options would be pointed out?
I'm all for massive simplification of the tarifs but one might prefer to be paying slightly over the going rate for example on the basis that the price is fixed for a certain period. The gamble being of course that this would ultimately pay off as prices escalate

brewerdave

By removing virtually all options/choices people will end up on the cheapest plan for their circumstances by default - the suggestion on the news was that there will be 4 options - fixed term,standard variable by DD,standard variable by quarterly bill in arrears and some sort of (more expensive!) Green deal. Presumably all suppliers would go to daily standing charges as well?

pineapple

brewerdave wrote: »

Presumably all suppliers would go to daily standing charges as well?

Thanks brewerdave.
What would help me personally is either the abolition of standing charges or certainly an end to different rates after a certain level of consumption. Plus the unit rate displayed in big letters on their websites!

brewerdave

pineapple wrote: »

Thanks brewerdave.
What would help me personally is either the abolition of standing charges or certainly an end to different rates after a certain level of consumption. Plus the unit rate displayed in big letters on their websites!

Unfortunately two tier pricing is one of the (many)complications of the current system - look at the problems created by NP two tier pricing where they fiddled (sorry sculpted ) the number of Kwhs per charging period - daily standing charges are simpler in principle and give the Utility Company some "guaranteed" income - can't see any of them going on to a single unified rate of p/Kwh!:)

deepdale56

It sounds like we are going to discover the implications of more regulation (and therefore less competition) in the energy market place by forcing the energy suppliers to limit their tariff options to four each. A majority of MSE members recently voted to renationalise the companies (the maximum of market regulation and the minimum of competition) so will presumably welcome the move.
This is very noble and self sacrificing of them because one of the unintended consequences of more law/regulation (the only certainty is that there always are some) is that the cheapest tariffs, sought out by savvy consumers who are prepared to take the time to do the research, will disappear. By definition the energy companies cannot afford to put most of their customers on their current cheapest tariff.
So the proposal may or may not be good for consumers generally - I personally doubt it - but it will definitely be worse for conscientious customers

C_Mababejive

Hahahaha..this makes me laugh so much. Do you realise what will happen? There will be less choice. Isnt that anti competitive and against the law?

Energy prices will actually go up not down.

The bottom line at the moment is that we have two sorts of punters.

We have those who are intelligent/capable enough to do their research and hack out the best deal then we have the rest who for various reasons dont seek out the best deal. It might be because they are incapable,stupid,apathetic,need help from relatives who cant be bothered to help them,set in their ways.

Now then at the moment,group two subsidizes the cheaper prices for group one.

If we have fewer choices and tarriffs and energy companies are somehow forced to put people on the cheapest tarriff,then the people in group one will pay more and the ones in group two may pay less but overall,we will all pay more.

Why should agile and intelligent people underwrite the stupidity and apathy of others?

steve-L

deepdale56 wrote: »

It sounds like we are going to discover the implications of more regulation (and therefore less competition) in the energy market place by forcing the energy suppliers to limit their tariff options to four each. A majority of MSE members recently voted to renationalise the companies (the maximum of market regulation and the minimum of competition) so will presumably welcome the move.
This is very noble and self sacrificing of them because one of the unintended consequences of more law/regulation (the only certainty is that there always are some) is that the cheapest tariffs, sought out by savvy consumers who are prepared to take the time to do the research, will disappear. By definition the energy companies cannot afford to put most of their customers on their current cheapest tariff.
So the proposal may or may not be good for consumers generally - I personally doubt it - but it will definitely be worse for conscientious customers

I don't necessarily agree......
Take people who are on a 2 tier rate for a dual energy deal but don't use gas.... (yes apparently it's cheapest for some people)....

They are on this because the endless options mean its near impossible to get a straight deal....
Everytime people switch is costs money... (someone mentioned £300 on a different thread and I believe its about right).
All of this eventually gets passed on to the consumer.

We don't actually have a free market... because there are no apples to compare with apples. Its not even apples and pears.... but apples, pears, bicycles and hot air balloons . Which of these is best for making cider? Which is best for commuting?

What I'm trying to say is we have to rely on price comparison websites which are usually wrong (I tried 4 and they each came back with different results) and then whatever you choose its not the tariffs themselves but the fineprint that needs to be examined.

We get inappropriate offers (I'm not interested in hot air balloons)
because its all wrapped up in so much obfuscation that the average consumer is lost and even the savvy ones have to use price comparison websites as you can't get the information yourself.
(I asked and everyone just said, can't be done..use the comparison websites)

The price comparison websites only get paid if you switch!

Moreover they work on a feelgood factor.... they tell you you might save £££ per year..... and that feels good.... you might not and you might have been better doing something else but as you'll never know and never have the information to find out.....

To actually have a real free market (and I don't believe the cat can be put back in the bag on privatisation even if that was the answer) people need access to the ACTUAL AVAILABLE TARIFFS....

By doing this and this requires simplifying the deliberately over-complex present situation everyone should be able to see the best deal and suppliers will have to compete on actual prices, not just hidden fineprint....

This should eventually even benefit the people who are in weird situations (such as its cheaper to go on dual fuel and not use the gas)....

I strongly suspect these people are not getting the best deal already but that is because the actual tariffs are not published so noone can compare them.

C_Mababejive

#7 Price comparison sites will never be perfect. The way i do it is that i have historical info on gas and electric usage which is in the form of kw per year for each fuel. It doesnt vary much and my mission is to manage it downwards.

When i want to compare, i trawl a couple of the big well known sites inputting my usage in Kw.

There is usually no or minor differences in the comparison websites.

If i then want to tweak further, i'll scrutinize the actual tariff on the suppliers website.


In this way i currently pay about £250 pa less than i would have otherwise done and i am a low end consumer.

This is the only place where competition exists. Most of the suppliers dont own gas. They buy it on the markets so they have little leverage as to price.

The only leverage available is to allow the savvy punters to be underwritten by those who cant be bothered or dont know how.

Thats their fault not mine. I dont want to pay for them.

Wywth

pineapple wrote: »

According to the news this morning, this is what our illustrious government is promising. How would this work exactly?
Would there be an annual review or would everyones payments be continuously monitored? Would people be moved automatically or would it simply be that the options would be pointed out?
I'm all for massive simplification of the tarifs but one might prefer to be paying slightly over the going rate for example on the basis that the price is fixed for a certain period. The gamble being of course that this would ultimately pay off as prices escalate

As I understand it (details to hopefully be clarified today), they will force the suppliers to do away with their umpteen cheap tariffs and just allow them 4, one of which will be an expensive 'green' tariff.

So with only 3 tariffs to choose from, it won't be difficult to put us all on the cheapest one. Almost as good as when the whole supply was government controlled with no choice whatsoever.

Thanks Dave, Maggie will be proud of you! :cool:

macman

For anyone able and willing to use a comp site, prices will inevitably now rise.
Those of us who switched to a long term (i.e. 2-winter) cheap fix back in the Autumn will be feeling rather smug now, as presumably existing tariffs will have to be honoured-this legislation will only apply when an existing tariff expires?

lardconcepts

C_Mababejive wrote: »

Hahahaha..this makes me laugh so much. Do you realise what will happen? There will be less choice. Isnt that anti competitive and against the law?

Energy prices will actually go up not down.

The bottom line at the moment is that we have two sorts of punters.

We have those who are intelligent/capable enough to do their research and hack out the best deal then we have the rest who for various reasons dont seek out the best deal. It might be because they are incapable,stupid,apathetic,need help from relatives who cant be bothered to help them,set in their ways.

I completely agree with that, but also that there are far too many tariffs, and many of the "stepped" tariffs are just designed to catch people out.

But four is way too few. Take the off-peak tariffs for example.

Right now I can choose from:

E7: 7 hours off peak 0030-0730 GMT.
Twinheat A: 7 off peak hours 0330-0730 and 1330-1630 GMT,
Twinheat B: 7 off peak hours 0030-0430 and 1330-1630 GMT
Option 14 is 14 off peak hours.

That's all four 4 tariffs used up right there.

What about those of us who have invested in "greener" energy like heat pumps? All my calculations were based exclusively on using entirely off-peak electricity, and yes, we're saving a lot like this.

But it's not just about the people who are going to lose out financially, and yes that includes the old lady with the storage heater, because using off-peak electricity not only balances the grid, but is greener. Even if you don't believe in all that green stuff, look at it this way:

Turbines run most efficiently when they run constantly and demand is balanced. The system becomes inefficient when the biggest but most efficient producers (which can't just be spun down on a whim) are spinning idly, and when peak load means far more expensive and inefficient "instant" systems like gas turbines need to be brought online.

So, yes, by all means cut down from 30 tariffs but dumbing down to 4 is only going to mean that everyone loses out and their bills will go up as the companies will only offer the four most profitable tariffs and I'm pretty sure that'll be at the expense of the off-peak tariffs.