Future Cap Prediction - Ouch.

Verdigris

The_Green_Hornet said:

What if I was to tell you I fixed for 2 years in the Summer?

What are your predictions for your supplier lasting that long?

Streaky_Bacon

Dolor said:

Even if gas wholesale prices reduced by 50% overnight, I think that we can all be confident that the Cap will rise in April to cover the extraordinary costs of failed suppliers.

I think you are absolutely right with regards to the cap.

But, if prices do fall, so that deals under the cap will still make money, suppliers will begin to offer them, and the cap may rise and no longer be the best deal on the market.

Suppliers will seek to get whatever money they can from whatever source they can, including customers on SVRs, the industry levy and government handouts, but it is still a fact that suppliers will even take a short term loss to accumulate customers and consolidate their market position.

If all the big suppliers did seek to keep prices high in the face of falling wholesale prices, it would not be long before somebody entered the market offering to undercut them.

Verdigris

I'm not so sure it is going to be about the lowest unit price in future. It will be more about tariffs tailored to your usage patterns. Basically Octopus on steroids.

Flight3287462

We use about 10,000KW of electricity, fixed on the Sainsbury's 2 Year Fix v18 15th of September cost for year £2,040 or £170/month. 

Current Sainsbury's 2 year fix is v22 cost £3,288 or £274/month. 

This is obviously quite expensive compared to the cap today but you might look like a hero come April?

wittynamegoeshere

I can't imagine £3000+ per year ever looking like a good deal, isn't that well over 30p/unit?

They are all just pricing at what will be profitable for them.  I doubt that they seriously expect anyone with any sense to sign up for it, not while we can all pay much less than that.  But if they offered any less they'll get even more customers that are costing them money instead of making profit for them.

It's basically a "go away" price, just like when you get a car insurance quote for £1000s - basically they don't want you.

JGB1955

Flight3287462 said:

We use about 10,000KW of electricity, fixed on the Sainsbury's 2 Year Fix v18 15th of September cost for year £2,040 or £170/month. 

Current Sainsbury's 2 year fix is v22 cost £3,288 or £274/month. 

This is obviously quite expensive compared to the cap today but you might look like a hero come April?

Big OUCH!  We took up the 2 year V18 plan at £110 per month.  That worked out as £110 per annum less than any Price Cap tariff would cost. Now it would cost us an extra £95 per month - £2470 - that's eye watering!  (Earlier this year our annual bill worked out at less than £800).

tux900

wittynamegoeshere said:

The sky might fall down before next October for all anyone knows.

I was starting to feel positive until you said that!

The_Green_Hornet

Verdigris said:

The_Green_Hornet said:

What if I was to tell you I fixed for 2 years in the Summer?

What are your predictions for your supplier lasting that long?

Very good thank you.

[Deleted User]

Boris said it's nothing, I trust him implicitly.

Can't see past the cap at the moment, miffed about Avro (that ended Feb) but if cap does go up next April then the fixed will be as well, as I see it, the only gamble is the fixed today will be on par with the cap rise (possibly) next April (I think). The cap next april will be higher (expected at the mo?) and the fixed then will rise. Reality now is I save around 800-1200 staying on the cap (when Octopus finally let me in on the rates) vs fixed. (some fag packet sums at the moment)

spot1034

Prices beyond this winter are already much lower in the market, and that reflects the expectation that the present tightness of supply will ease. Much can change, and where we will be next spring depends as much as anything on the weather between now and then.

However it is quite possible that by then fixes might well look much more attractive than they do at the moment.