Daily standing order - whats all the fuss?

amtrakuk

I read on another thread someone commenting about a 3000% increase in their energy cost with the introduction of a single tariff & standing charge. I found it hard to believe and had to look into it. Going on the basis of it being gas, the usage would have to be so low the gas used must almost be negligible.

Ball park figures for gas usage:

My standing charge is 22p a day, 3000% of 22p is 0.7p or 1/6th of a kW - Not even enough to boil a cup of water.
Baking a cake in the oven roughly takes 2-3kW of gas (inc preheat), boiling a 500 ml pot of water on the hob takes between 1 or 1.5kW of gas (depending on what ring you use) and is only 30-40% efficient the rest of the heat is wasted.

Why split your services (gas/electric) if your usage is so low and its going to work out super expensive with the daily standing charge model? If you only "boil an egg" a couple of times a week on a gas hob (The only way I can think keeping gas consumption very low) and use electric for everything else, why keep gas? You wont be saving that much over electricity for "boiling an egg" for such a low usage anyway.

Its a bit like anything in life, if you buy very small amounts it works out more expensive.

molerat

Many of those people live in older properties and that is the way it was done, the house I grew up in had a gas oven and solid fired heating. The cost of installing another form of cooking to many would be prohibitive, a new oven and the required electrical installation would run into several hundreds, up to now they have been managing quite nicely.

Tesco don't charge me to drive onto their forecourt before I fill up and it costs me the same per "unit" whether I take 10l or 100l, the costs of supply are built into the "unit" price.

scaredofdebt

I agree with you, for most situations.

However, I am aware of a lot of elderly/vulnerable people who are considering having their gas supply removed due to these charges.

You have to bear in mind a lot of these people do not have access to the internet to compare prices and are not very "savvy". They may only have gas for heating and even then they may only use it when the weather is particularly cold.

They therefore see the daily standing charge as having to pay for nothing, the charges can be up to 60p a day or close to £200 a year. If you're on a modest fixed income that's a big increase in outgoings, on top of the price rises in fuel itself on top.

My concern is that when we get a cold spell people will die because of these charges and I have written to the regulator about this issue.

amtrakuk

I hear what you are saying but there are many many ways to check and switch suppliers, from the local Library, CAB to governments Money Advice Service. All of these services will help people switch.

If using gas for cooking only the cost difference between the T1 (old) and single rate (new) as said before means people will have to use LESS than it costs to boil 500 ml of water a day before equilibrium is reached. From looking at rates form the big 6 on the basis of low usage (mainly T1 rate) the new flat rate is cheaper.

Yes I appreciate there will be some who don't understand money management but again help is on offer.

Nada666

What about insulated homes with gas heating and hot water and cooking? Why should they have to pay thousands of pounds for a new cooker and rip out a perfectly adequate heating system? What about rented flats - how many landlords are going to pay to put a working boiler on a scrap-heap?

Many people are facing increases of seventy or one hundred or two hundred percent. (Let's ignore the crazy increases and those who don't use anything - there are alternatives for them). For those using a small amount of electricity or gas year round the increases are non-trivial. And Ebico is more expensive for them than alternatives available last year.

It is a ridiculous change - if anything, tariffs should have had tiers added. A lot of their research is dodgy - one survey they abused had ridiculous questions that simply did not address the issue and was designed to provide the results they wanted.

Nada666

molerat wrote: »

Tesco don't charge me to drive onto their forecourt before I fill up and it costs me the same per "unit" whether I take 10l or 100l, the costs of supply are built into the "unit" price.

They do charge two-tier prices for ninety percent of their lines, though. I really do not think you can cite supermarkets as exemplars.

I_have_spoken

I have written to the regulator about this issue.

Ironically it's the directive from Ofgem to 'simplify' tariffs which has meant the big-6 removing tariffs without a standing charge as it's a minor usage group compared to typical dual-fuel tariffs.

amtrakuk

Nada666 wrote: »

What about insulated homes with gas heating and hot water and cooking? Why should they have to pay thousands of pounds for a new cooker and rip out a perfectly adequate heating system? What about rented flats - how many landlords are going to pay to put a working boiler on a scrap-heap?

Many people are facing increases of seventy or one hundred or two hundred percent. (Let's ignore the crazy increases and those who don't use anything - there are alternatives for them). For those using a small amount of electricity or gas year round the increases are non-trivial. And Ebico is more expensive for them than alternatives available last year.

It is a ridiculous change - if anything, tariffs should have had tiers added. A lot of their research is dodgy - one survey they abused had ridiculous questions that simply did not address the issue and was designed to provide the results they wanted.

Thats fine if they have gas boiler or use a decient amount of gas, as the basic unit price of energy will be comparable to what they were paying before. The Tier system was abit ridiculous as T1 (usually first 250kW) was spread over the 4 quarters therefore T1 would have been for the first 62.5kW per quarter and the monthly direct debit was based on the quarterly usage.

Nada666

amtrakuk wrote: »

Thats fine if they have gas boiler or use a decient amount of gas, as the basic unit price of energy will be comparable to what they were paying before. The Tier system was abit ridiculous as T1 (usually first 250kW) was spread over the 4 quarters therefore T1 would have been for the first 62.5kW per quarter and the monthly direct debit was based on the quarterly usage.

1) Uhm, we are not talking about customers who use a (relatively) decent amount of gas, are we?
2) The rest of your post (second sentence on) contains gibberish numbers. And the words don't add up, either.

Nada666

(In your op you mention a 3,000 % increase - but that was for electricity, not gas iirc (unless it was a different thread).)

Pincher

Bottled gas does have all the costs built into the unit price, it's just that it's four times the price of mains gas; but if you are a really ultra low user, then it could be worth converting.

Including depreciation, I would say my car is costing me at least£2,000 a year before petrol. That's a lot of minicab rides.