Variable (Capped) Tariffs - Do they even exist?

wittynamegoeshere

Do all suppliers have to provide a variable (therefore capped) tariff?  I'm currently being forced to switch due to Symbio going bust, I'm waiting for the process to happen, but I've just tried getting a quote for my forced switch (to eon next), and the one and only tariff they're offering is fixed, at a whopping 29p per unit, plus 35p per day.  I was previously paying less than half of this, I expected a rise but this seems ridiculous.

I can't find a simple answer for what the capped unit rate is, but I suspect it's less than this.

Am I right in thinking that fixed tariffs are not capped?

Can the suppliers avoid the cap by just not offering a variable tariff at all?

If it's that easy to avoid then what's the point in having a cap, or Ofgem themselves?

I feel a bit stitched up, I don't want to risk switching early, as Symbio owe me about £500.  So it appears I just have to let them open my wallet and take as much as they fancy for a few months until everything is settled up.

MWT

The problem you are having is that you will not see the standard variable tariff which is capped being offered to new customers right now.

So if you look at switching it will not be one of the options open to you.

As part of a move under the SoLR scheme you will however be placed on a capped tariff so no need to worry on that score at least.

QrizB

First the most important bit: don't panic.

No, suppliers don't have to offer a capped variable tariff to switching customers.

Yes, suppliers do have to offer a capped variable tariff to existing customers who come to the end of their deal.

No, customers of a failed supplier don't necessarily end up on a capped variable tariff. The SoLR will agree a tariff with Ofgem and this will be maintained for 6 months. In practice, however, Ofgem are unlikely to agree a SoLR tariff higher than the cap.

Your best bet is to sit tight and see what tariff E.On Next offer you. It will be higher than Symbio but is likely to be around 20p/kWh and 24p/day.

wittynamegoeshere

Thanks, hopefully that's a relief.

I realise that it's variable depending on location, but are there any rough figures for what the cap equates to, in terms of per unit and per day figures?  I can't find any myself.

So if you're currently happy with a capped variable tariff but not your supplier, then you can't take your custom elsewhere without switching to a more expensive tariff.  Is this how competition was meant to work?!  I do wish the govt would just pull the plug on the whole joke of a system, it's a farce.

Ultrasonic

wittynamegoeshere said:

So if you're currently happy with a capped variable tariff but not your supplier, then you can't take your custom elsewhere without switching to a more expensive tariff. 

Yes.

wittynamegoeshere said:

Is this how competition was meant to work?! 

No but then it was never envisaged that the price cap would amount to forcing energy companies to sell energy for less than the current cost to them of purchasing it.

QrizB

wittynamegoeshere said:

Thanks, hopefully that's a relief.

I realise that it's variable depending on location, but are there any rough figures for what the cap equates to, in terms of per unit and per day figures?  I can't find any myself.

So if you're currently happy with a capped variable tariff but not your supplier, then you can't take your custom elsewhere without switching to a more expensive tariff.  Is this how competition was meant to work?!  I do wish the govt would just pull the plug on the whole joke of a system, it's a farce.

Yes, @jimjames has kindly crunched the numbers and put them up on a webpage for the greater good.

http://price-calc.321web.co.uk/

I don't think it includes VAT (unless he's updated it since) so you'll have to add 5% to whatever you get.

RudolphHucker

https://www.eonnext.com/symbio-energy

As a Residential customer, what tariff will I be on and how much will I pay?

We've put you on our cheapest variable tariff based on Ofgem average energy consumption* and we'll guarantee these prices until 31 March 2022. Once we've moved your account, you're welcome to change your tariff or supplier later if you want to.

* Ofgem average annual consumption of 2,900 kWh electricity and 12,000 kWh gas.

wittynamegoeshere

But this amounts to the cap basically not existing, at least not if you want to change supplier.  Your supplier can treat you as badly as they like, overcharge you, not bother answering the phone - because they know that you can't go elsewhere.  Any meaningful competition has basically stopped.

Perhaps companies even have an incentive to get rid of the customers who are on the variable tariff - if they're losing money by supplying them then they need to treat them as terribly as possible until they go away.

The entire system has failed.  I'd hope that the govt response would be to either force them to offer capped tariffs or just shut down the entire system and start again, but probably not.

PeterGr

EON's table of standard variable tariff rates  excluding and including VAT is available online.  A Google search takes you there in a couple of clicks.

wittynamegoeshere

Thanks, will have a look.  I didn't think there was a price list, as it varies according to postcode when you use their website and I didn't know whether they would be offering everything listed anyway.

Hopefully if I get 20p-ish per unit then we won't have to burn the furniture.

spot1034

Deleted_User said:

I agree that the whole nonsensical energy supply market should be scrapped. However, this oddity that you can't voluntarily switch to a capped variable tariff will probably only be with us for the next 6 months.

Incidentally, many businesses sometimes run at a loss for a while. There is no need to be horrified on energy supplier companies' behalf that this is happening them.

Perhaps not the big boys, but the smaller suppliers who have done everything right and hedged properly in respect of their existing fixes are going to become increasingly vulnerable if the fixes come to an end and they are then obliged to offer their customers a capped rate which loses them money. They won't be able to stand these losses for the same length of time as the larger firms, and of-course they won't have the same flexibility when the situation eases, so we could see a situation when prices start to come down where the better capitalised firms compete aggressively, the aim being to force the smaller suppliers out. They'll then be able to recover their losses and charge higher prices going forward.