Standing Charges guide - official forum discussion 10 December 2013 at 4:12PM in Energy 81 replies 23.6K views

Former_MSE_Rose

Hi all,

This is an official discussion thread for our new Standing Charges guide, and we'd love your feedback. Have you got any pointers on the guide you'd like to pass on, any success stories from following its tips, or any info that'd help other MoneySavers? If so, just click 'reply' to post.

Thanks for your help,

MSE Rose

Geep

According to Ofgem, they do NOT require a Standing Charge. This is specifically what was stated to me, during a phone discussion with them last September. Also, their website states "We don't set standing charges and there is nothing stopping suppliers setting the charge at zero if they want. Some suppliers are doing this and if there is consumer demand for such tariffs we would expect this to continue. These are likely to be the best value products for consumers with low usage."

Nada666

Geep wrote: »

According to Ofgem, they do NOT require a Standing Charge. This is specifically what was stated to me, during a phone discussion with them last September. Also, their website states "We don't set standing charges and there is nothing stopping suppliers setting the charge at zero if they want. Some suppliers are doing this and if there is consumer demand for such tariffs we would expect this to continue. These are likely to be the best value products for consumers with low usage."

You do realise your very first sentence is entirely contradicted by the rest of your paragraph? Unless the point you are making is that you were lied to by the telephone correspondent.

Nada666

Former_MSE_Rose wrote: »

Hi all,

This is an official discussion thread for our new Standing Charges guide, and we'd love your feedback. Have you got any pointers on the guide you'd like to pass on, any success stories from following its tips, or any info that'd help other MoneySavers? If so, just click 'reply' to post.

Thanks for your help,

MSE Rose

Nice to see your entire article focuses only on rich households with annexes and separate supplies and holiday homes but does not once mention the poor or the well-insulated.

Nada666

"The death of zero standing charges tariffs has been exaggerated"

? What? A rather strange opening sentence. From "pretty much every single one of hundreds of tariffs has an alternative NSC version" to "there are two or three".

Geep

Nada666 wrote: »

You do realise your very first sentence is entirely contradicted by the rest of your paragraph? Unless the point you are making is that you were lied to by the telephone correspondent.

I was quoting verbatim what I was told, and recorded in writing during the conversation. I have no way of knowing the veracity or otherwise of the other person involved, but would not remotely want to suggest I was being lied to. In the interests of exactitude, I'm happy to change my initial sentence to read "According to Ofgem, they do NOT require the imposition of a Standing Charge."

Cardew

I wonder why the article included this statement:

Yet for those it isn't right for, paying a standing charge can be a nightmare, as some found out when their tariff had a standing charge added after Ofgem changed the regulations. Back then, MoneySaver John told us:

"My electricity bill will rise by more than 1,800%. That's not a typo. I'm told I must now pay a daily standing charge in addition to the tariff rate.

"My garage is remote from my house. It has electricity which I need intermittently. My annual bill is around £6/year but now I'll be forced to pay the standing charge plus the rate per kwh, taking the bill from £6 to around £110. I will be paying for something I never use. Thanks Ofgem, really acting in our interests here!"

Earlier in the article it explained that there are tariffs with a zero standing charge - so the 1,800% rise is just nonsense.

Generally those with low consumption are better off with a low DSC and higher unit cost; whilst it is the opposite for those with high consumption. For anyone wanting to know their cheapest tariff it is necessary to predict exactly your consumption in the year ahead.

It also means that to get the cheapest outlay for duel fuel customers you need to check getting gas and electricity from different companies. It was rarely cheaper in the days of two tier tariffs - it is now.

Nada666

Cardew wrote: »

Earlier in the article it explained that there are tariffs with a zero standing charge - so the 1,800% rise is just nonsense

No it's not. The fact that one or two other tariffs may be available elsewhere does not mean that that increase does not exist on that tariff (and on any other tariff by that supplier) (and by most every other supplier.)

And the long term problem is that the cost burden of these users is no longer distributed evenly amongst all suppliers - they are now shouldered by one or two.

DJC1690

whats you prob about Standing Charge any way?

Miniman

It completely defeats me why there should be a variety of standing charges for the same energy supplier's range of tariffs.

Any one supplier has a range of tariffs for the energy it supplies to a particular area. This energy comes through the same pipes and wires for all its tariffs and the maintenance of that infrastucture is the same according to the agreement for that supplier. The charges may differ across suppliers but not within a supplier.

What an energy company does is to play games between the standing charge and the price of the fuel. This only adds to the confusion as far as the customer is concerned.

MSE should investigate and campaign for one standing charge per energy supplier. This would then create transparentcompetition between suppliers for their energy charges and add to pressure on the infrastructure companies with their costs being more open to scrutiny. It would also make the actual cost per Kwh much much easier to compare bewteen suppliers.

It would seem that Ofgem, the Government and the Energy suppliers are all in cahoots to retain as much confusion as possible in this area.

In addition, when energy prices were rising, energy companies cited the fact that gas pricse were linked to the price of oil. Where has that link gone now that oil price has fallen so markedly? The argument is very quiet. We need to put more public pressure on the energy market.

System

Miniman wrote: »

It completely defeats me why there should be a variety of standing charges for the same energy supplier's range of tariffs.

Any one supplier has a range of tariffs for the energy it supplies to a particular area. This energy comes through the same pipes and wires for all its tariffs and the maintenance of that infrastucture is the same according to the agreement for that supplier. The charges may differ across suppliers but not within a supplier.

What an energy company does is to play games between the standing charge and the price of the fuel. This only adds to the confusion as far as the customer is concerned.

MSE should investigate and campaign for one standing charge per energy supplier. This would then create transparentcompetition between suppliers for their energy charges and add to pressure on the infrastructure companies with their costs being more open to scrutiny. It would also make the actual cost per Kwh much much easier to compare bewteen suppliers.

It would seem that Ofgem, the Government and the Energy suppliers are all in cahoots to retain as much confusion as possible in this area.

In addition, when energy prices were rising, energy companies cited the fact that gas pricse were linked to the price of oil. Where has that link gone now that oil price has fallen so markedly? The argument is very quiet. We need to put more public pressure on the energy market.

I think that you will find that what you are suggesting might break current Competition Law. As I understand it, Ofgem requires all energy suppliers to impose a Standing Charge - however, Ofgem goes on to say that the charge may be set to zero.

From an energy user's perspective, tariffs with a zero standing charge but high unit price suit those who use low amounts of energy. Conversely, those who use high, but sometimes variable amounts of energy, are happy with higher standing charges and lower unit prices.

I appreciate that a single standard standing charge might make the calculations a bit easier but, that said, they aren't that difficult. I sense that this is a campaign that is probably dead in the water from the start.