Energy market - new standards of conduct

Consumerist

If suppliers are required to declare, rather than hide, a standing charge then surely this will be reflected in a lower unit charge that goes with it.

The current tier-1 unit charge assumes a minimum annual usage (2,680 kWh pa gas, 900 kWh pa elec) in order to collect the hidden standing charge over a full year. That averages out to the equivalent of about 223 kWh per month. I don't really see that anyone living in a property could use much less than this amount, even during the summer, for cooking and hot water.

Theoretically, you might reduce your standing charge payment under a two-tier system during the summer months but in practice it seems to me that the saving would be minimal.

Accordingly, in practice, I think any additional charges due to paying a standing charge will be insignificant compared to the general increases we will all be paying in the future.

Cardew

Consumerist wrote: »

The current tier-1 unit charge assumes a minimum annual usage (2,680 kWh pa gas, 900 kWh pa elec) in order to collect the hidden standing charge over a full year. That averages out to the equivalent of about 223 kWh per month. I don't really see that anyone living in a property could use much less than this amount, even during the summer, for cooking and hot water.

Theoretically, you might reduce your standing charge payment under a two-tier system during the summer months but in practice it seems to me that the saving would be minimal.

Accordingly, in practice, I think any additional charges due to paying a standing charge will be insignificant compared to the general increases we will all be paying in the future.

Well the Tier 1 'slice' for gas has varied with 4,572kWh pa being popular with some companies, and 500kWh pa for electricity. Not to mention the seasonal weighting(sculpting) used by Npower.

There are quite a few people on MSE who state they only use gas for cooking.

Many blocks of flats have their heating and hot water provided from a communal boiler and again only use gas for cooking.

These have the option of moving to Ebico for gas - but many will never have heard of the company. Also they will lose any dual fuel discount.

DragonQ

Do the switching rules apply to existing tariffs by the way? Would be nice to know I can switch 42 days before my fixed tariff ends and not face termination charges or price increases.

Consumerist

DragonQ wrote: »

Do the switching rules apply to existing tariffs by the way? Would be nice to know I can switch 42 days before my fixed tariff ends and not face termination charges or price increases.

My understanding is that current contracts will run their course. When the new regs apply, suppliers will be obliged to notify consumers 42 - 49 days in advance of the end of a contract - this will be the start of the switching window. So when the new regs apply, the supplier should give you the notice.

I think this particular aspect of the RMR will not need to be introduced by suppliers until 31 March 2014. But I could be wrong since I haven't digested the whole decision document.

It's not bedtime reading but if you want to plough through chapter and verse of the RMR decision document then you can find it <here>. My info came from paras 4.8 - 4.10 of that document. It's still subject to appeal by the energy companies for 20 days from 27 August.

I'd be interested to hear your interpretation.

Consumerist

Cardew wrote: »

Well the Tier 1 'slice' for gas has varied with 4,572kWh pa being popular with some companies, and 500kWh pa for electricity. Not to mention the seasonal weighting(sculpting) used by Npower. There are quite a few people on MSE who state they only use gas for cooking. . .

Well, on my comparison list of about 70 tariffs, only four were two-tier tariffs and all of those applied the higher rate to the first 2,680 kWh of gas use. The tier-1 electricity was either 700 or 900 kWh pa..

As a "medium" user, it's possible the tariffs with 4,572 kWh pa on tier-1 gas prices were right off the scale for me or not available in my region.

I still think it unlikely that many people will see their bills double and the RMR has put paid to a lot of the energy suppliers tricks. The 42-day switching window, for instance, will make switching a lot easier without scaring off consumers by threats of early-termination fees [or being put on default tariffs]. It's a shame we have to wait till next March before that happens.

zeupater

Consumerist wrote: »

... I don't quite understand how the changes which are being introduced will put prices up any more for the energy-efficient or poor than for anyone else. Please explain.

&

Consumerist wrote: »

Please explain why bills will double.

Hi

As the above hasn't yet been addressed, may I be allowed to explain .....

Consider an energy efficient property, one which is very well insulated, well draught-proofed and has micro-generation technologies such as solar thermal & photovoltaic panels. Obviously, this combination introduces a particularly wide asymmetry between summer & winter energy purchase requirements, particularly if the main winter heating source is gas.

It is extremely likely that such a property would utilise electricity, as opposed to gas, for cooking due to envelope specific airtightness and an occupier requirement to maximise self-use of their own renewables energy generation, thus reducing their overall carbon footprint. It is also extremely likely that solar thermal (alternatively pv proportional immersion water heating) could provide 100% of domestic hot water for around 8 months of the year ... if this displaces gas usage then under NSC tiered tariff there would be a 100% saving against a standing charge equivalent for two whole quarters ... by deleting the NSC offerings the %age increase for gas specific charges for these two quarters is infinite !!

HTH
Z

zeupater

Consumerist wrote: »

Hang on a minute.

Are you discussing gas prices? How many people use only 1,000 kWh per year of gas?

Are we talking about those "poor" multiple-property owners whose properties stand empty for most of the year?

Hi

There must be some out there, I know because, despite the particularly long winter period running into this year, that's pretty close to what we managed to use .... and the property wasn't empty either - probably 'cooler' than most would prefer, but, due to a pretty efficient log-burner, not especially cold .... :cool:

HTH
Z