Energy price cap to save households £75, Ofgem says

50Twuncle

"An energy bill price cap of £1,136 a year for "typical usage" has been proposed by the regulator, Ofgem.
It says the move will mean 11 million households on default deals will save about £75 on average, although the amount households could save will depend on their usage and supplier."


WRONG - It will only reduce the costs for those who are already paying over £1136 pa !!
Nowhere near 11 million - perhaps 1 million at the most.

spenderdave

The media presentation of this (and by the Ofcom representatives they have on) is as clear as mud. What do they mean by 'cap' anyway? My consumption (electric and gas) is around £900 a year, way below the cap level. I moved to fixed rate anyway earlier this year so guess it doesn't apply to me anyway. They should explain it in plain English rather that just quote this hypothetical average annual bill - energy is sold by how much you use, you don't sign up for it at an annual rate.

[Deleted User]

50Twuncle wrote: »

"An energy bill price cap of £1,136 a year for "typical usage" has been proposed by the regulator, Ofgem.
It says the move will mean 11 million households on default deals will save about £75 on average, although the amount households could save will depend on their usage and supplier."


WRONG - It will only reduce the costs for those who are already paying over £1136 pa !!
Nowhere near 11 million - perhaps 1 million at the most.

Everyone on SVT tariffs with their supplier will get a lower capped rate but only up to average use of yearly kwhs which is 3100 electric kwhs and 13200 kwhs.. All lower users get slightly lower capped rates up to this figure also .Go over it and they pay the normal higher tariff of whatever the supplier has set their SVT at. . That is approx 11 million customers to benefit.
This will start in December this year until April 2019 when its reviewed every six months up to 2020.
Its not a bad little reduction , better than nothing, and aimed at the people who can afford to sit back and take no notice of the much lower yearly fixed deals if they took the trouble of switching. Some people are adverse to direct debit payment also..Usually the elderly who don t trust banks

caveman38

What happens to those customers like myself, who. Still pay their bills to the default supplier (in my case Eon & BG) and am not on DD either.
If it does apply to me how would the maximum(cap) be applied to each supply.
Also my total costs for are nearer £1,800 per year . what would I expect to save.

50Twuncle

spenderdave wrote: »

The media presentation of this (and by the Ofcom representatives they have on) is as clear as mud. What do they mean by 'cap' anyway? My consumption (electric and gas) is around £900 a year, way below the cap level. I moved to fixed rate anyway earlier this year so guess it doesn't apply to me anyway. They should explain it in plain English rather that just quote this hypothetical average annual bill - energy is sold by how much you use, you don't sign up for it at an annual rate.

They will expect you to up your useage to £1136 pa

caveman38

50Twuncle wrote: »

They will expect you to up your useage to £1136 pa

As I stated. My usage for both fuel (although paid separately) is £1,800.

scaredofdebt

Prices for those on cheaper tariffs will go up to "subsidise" the "losses" the companies will make because of the cap!

So much for privatisation driving competition!

50Twuncle

caveman38 wrote: »

As I stated. My usage for both fuel (although paid separately) is £1,800.

I was responding to spenderdave - who spends £900 pa on dual fuel !

caveman38

I am still interested to find out how the cap will affect me and others who are too still with our default companies for individual fuels. The cap is only quoted as a figure for those on dual fuel tariffs.
How will ours be calculated?

MothballsWallet

Ofgem (like Ofcom) are a completely useless regulator that doesn't care about the consumer, only in being friends with the industry.

A tanker full of manure is more useful than Ofgem.

PixelPound

The documentation on this is very wooly. Seems this cap has many factors and will go up and down. Effectively it will probably mean some of the higher SVT will be tweaked. Not sure if it means a unit price reduction or simply a "discount" value put on bills based on consumption.

Not sure this will reduce cheaper tariffs available as those with the highest SVT rates tend not to be offering cheapest deals anyway.