Brit Gas standing charge.

Somniac

British Gas having introduced a standing charge of 25p a day (for me) should have put their unit prices down shouldn't they? Given that the charges for supply admin etc were formerly incorporated into the unit price.

Nada666

No they weren't - they were incorporated in the delta to the tier 1 price. That is, if they are now charging 26p per day then with the previous two tier tariff the first 7.x units used per day were charged at 7p or 8p instead of 4p. The 3.yp difference times the 7.x would have worked out to be the exact same.


(You are correct, though, that not all customers would have used all their tier 1 units each and every quarter so some of the charges have to be recouped from the tier 2 units.)

Bluebirdman_of_Alcathays

They put the price up by 9.2%, so no you shouldn't see unit price going down.

They are decreasing prices on 1st January, have you received notification on how that'll affect the standing charge?

Somniac

Yes they have said the reduction is 3.2%.
I can understand that bit.

Quote:
We were previously billing your accounts on Tier 1 and Tier 2 rate. As per this billing structure, we were charging you Tier 1 on a higher rate and Tier 2 on a lower rate. Also, in this billing structure we were calculating your Direct Debit discount on your Tier 2 consumption.

On our new billing structure, we've removed the complex Tier 1 and Tier 2 units and thresholds along with our capped p/kWh discounts. This means, that you'll now be charged a single unit rate for the energy usage and there will be no threshold limit. Also, on our new billing structure you can enjoy the benefit of full Direct Debit discount.

So, we've kept a fixed daily standing charges of 26.000p on all our tariff's and the tariff rates as per the payment method. We charge different tariff rates for cash/ cheque payment method and Direct Debit payment method.
I'm pleased to inform you that we've recently announced reduction in our energy prices at an average rate of 3.2% which will come into effect from 1st January 2014. So, the tariff rates on your current tariff will also be reduced from 1st January 2014. You can view your recent tariff rates on our website."

Anyone who speaks British Gasish , can you please translate?

Bluebirdman_of_Alcathays

Somniac wrote: »

Yes they have said the reduction is 3.2%.
I can understand that bit.

Quote:
We were previously billing your accounts on Tier 1 and Tier 2 rate. As per this billing structure, we were charging you Tier 1 on a higher rate and Tier 2 on a lower rate. Also, in this billing structure we were calculating your Direct Debit discount on your Tier 2 consumption.

On our new billing structure, we've removed the complex Tier 1 and Tier 2 units and thresholds along with our capped p/kWh discounts. This means, that you'll now be charged a single unit rate for the energy usage and there will be no threshold limit. Also, on our new billing structure you can enjoy the benefit of full Direct Debit discount.

So, we've kept a fixed daily standing charges of 26.000p on all our tariff's and the tariff rates as per the payment method. We charge different tariff rates for cash/ cheque payment method and Direct Debit payment method.
I'm pleased to inform you that we've recently announced reduction in our energy prices at an average rate of 3.2% which will come into effect from 1st January 2014. So, the tariff rates on your current tariff will also be reduced from 1st January 2014. You can view your recent tariff rates on our website."

Anyone who speaks British Gasish , can you please translate?

You (and everybody else) was paying a standing charge before - it was just sculpted into the higher tier 1 rates. OFGEM decided this was too complicated for the stupid British person to understand, so made all suppliers charge a flat rate per KWh, and a flat standing charge.

This will negatively impact extraordinarily low users, but won't really affect anybody else - look at it as a change in the method they are billing rather than a price change.

Obviously then one has to factor in the price rise of 9% in November, and the price decrease of 3% in January, which has muddied the water. On average, people will therefore be seeing a net increase of around 6% from the October to the January prices.

As always put your consumption in KWh and your postcode into a price comp to see the best tariffs for you, and change via a cashback site to take the commission for youself.

Somniac

Thank you. i sort of understand but it still seems a con.

funpayback

I just gota let off steam more than anything! Cos I hardly use any gas I nearly fell over when british gas sent my bill, my gas bills have only ever been around £12.00 but this one was nearly 130% dearer at over £27.00, bearing in mind I only use it for hot water I was sure they'd made a mistake as my usage was 4cubic whatever's more than last quarter. I'm disabled with an incurable kidney disease,osteo arthritis etc etc and take over 200 pills a day, I cant have central heating on as it dehydrates me+struggle to drink 8litres a day as it is.
I emailed them asking what's going on. I didn't know they'd changed billing crap......so even if I don't use any gas at all they have the privilege of charging me £1.82 a wk! Talk about take the proverbial.
I think it's disgusting that they steal from customers for NOT using their product! Why bother cutting back? They'll just find another way to rip people off whether we like it or not...
Makes me wonder why I bother.......:mad:

dude89

funpayback wrote: »

I just gota let off steam more than anything! Cos I hardly use any gas I nearly fell over when british gas sent my bill, my gas bills have only ever been around £12.00 but this one was nearly 130% dearer at over £27.00, bearing in mind I only use it for hot water I was sure they'd made a mistake as my usage was 4cubic whatever's more than last quarter. I'm disabled with an incurable kidney disease,osteo arthritis etc etc and take over 200 pills a day, I cant have central heating on as it dehydrates me+struggle to drink 8litres a day as it is.
I emailed them asking what's going on. I didn't know they'd changed billing crap......so even if I don't use any gas at all they have the privilege of charging me £1.82 a wk! Talk about take the proverbial.
I think it's disgusting that they steal from customers for NOT using their product! Why bother cutting back? They'll just find another way to rip people off whether we like it or not...
Makes me wonder why I bother.......:mad:

Blame OFGEM..... or even better blame the british public for not being able to understand their bills.

The standing charge covers the costs of maintaining your supply. That includes all the metering, pipe work, emergency response and billing. In effect you have been getting away with not paying for the majority of this for years but now OFGEM has told all companies to simplify their tariffs you have finally fallen in line with the majority of customers.

EBICO still offer a non standing charge tariff though the unit rate is fractionally higher.

unlucky67

OFGEM haven't told the energy companies what the standing charge rate has to be though?
BG have standing charges of £180 per year - £90 for electricity and £90 for gas seems a lot to me...
On my low useage property I was paying a standing charge anyway (16p per day - I think) ...they increased this in November and as far as I am aware didn't tell me they were going to do that..
Am in the process of switching to Ebico - no standing charge but higher rate per kW...but will save me a fortune for my renovation property...
When I spoke to BG - on one hand they told me they had held off as long as they could introducing the standing charge for their loyal customers (me) - and then told me that for the property I live in I should be better off with the standing charge!!!:mad:

Nada666

unlucky67 wrote: »

OFGEM haven't told the energy companies what the standing charge rate has to be though?
BG have standing charges of £180 per year - £90 for electricity and £90 for gas seems a lot to me...
On my low useage property I was paying a standing charge anyway (16p per day - I think) ...they increased this in November and as far as I am aware didn't tell me they were going to do that..
Am in the process of switching to Ebico - no standing charge but higher rate per kW...but will save me a fortune for my renovation property...
When I spoke to BG - on one hand they told me they had held off as long as they could introducing the standing charge for their loyal customers (me) - and then told me that for the property I live in I should be better off with the standing charge!!!:mad:

£91-odd is a pretty typical price most companies charge. And this is Ofgem's decision, not the suppliers'. British Gas have held off.

Write to and about Ofgem, not the suppliers.

Good to see another non-(rather than low-)user switching to Ebico. With luck they will be driven belly-up and Ofgem will be brought to task for their obscene banning of two-tier tariffs.

aleph_0

unlucky67 wrote: »

OFGEM haven't told the energy companies what the standing charge rate has to be though?

No. But OFGEM did also restrict the number of 'core' tariffs a company could offer to four.

So, whilst a company could have chosen to offer a new tariff with no standing charge, and the old Tier 1 rate, it might have to be at the expense of removing a different tariff. Which will upset more people.