What should the unit prices be to cover wholesale prices?

RegForme

QrizB said:

Of course, all this could be completely wrong; I'm just a random person on the internet, after all. I've tried to explain where my numbers come from; you can check them yourself and, if you disagree, I'd like to know why.

In particular, I don't have access to the same wholesale pricing models as Ofgem (they pay for theirs, I copy mine from the internet) and so I could be out. Also I don't have any real insight into how all the other factors - network costs, operating costs, policy costs etc. - might change; I've had to guess.

Saying "but the government won't permit it" is a different argument and that comes down to politics, not maths.

So I *will* be wrong, possibly by a tiny bit, possibly by a lot. And we'll find out how wrong next week.

I just want to say thanks for all the work you've put in over the past few months with these models/estimations. I've found it massively helpful for my personal budgeting, and really interesting too! 

I'm very excited to see how your estimation turns out wrt Ofgem's cap announcement! Fingers crossed

Verdigris

Top totting-up, again, from QrizB. Thank you. May your pencil never go blunt!

Spies

GingerTim said:

Ouch! (and ever more glad I fixed for three years in July, what dumb luck that was)

And that your provider didn't go bust!

GingerTim

Spies said:

GingerTim said:

Ouch! (and ever more glad I fixed for three years in July, what dumb luck that was)

And that your provider didn't go bust!

If EDF goes bust, then we're all in trouble!

savers_united

Looking at the breakdown which is really good, why do Ofgem load the majority of costs onto the unit rate and set the ceiling for SC. 

There have been numerous posts recently from what seem like low users of the high standing charge they are forced to pay.

But looking at the info you have provided 25p per day SC or approx £90 per year does not cover all the fixed costs and obligations. I would expect the SC to increase to cover the SOLR charges as an example and not lumped into the unit rate, same for an increased WHD etc, by having it on the unit rate we are not all equally contributing to these costs, a fairer way would be seperate energy costs (unit rate) from fixed costs / obligations (SC).

If I read it right are high users subsidising low user contributions. 

victor2

QrizB said:

Of course, all this could be completely wrong; I'm just a random person on the internet, after all. I've tried to explain where my numbers come from; you can check them yourself and, if you disagree, I'd like to know why.

In particular, I don't have access to the same wholesale pricing models as Ofgem (they pay for theirs, I copy mine from the internet) and so I could be out. Also I don't have any real insight into how all the other factors - network costs, operating costs, policy costs etc. - might change; I've had to guess.

Saying "but the government won't permit it" is a different argument and that comes down to politics, not maths.

So I *will* be wrong, possibly by a tiny bit, possibly by a lot. And we'll find out how wrong next week.

Great research! Thanks.

Hope you're wrong, but doubt you'll be far off!

QrizB

Thank you all for your kind words.

I have to chuckle when I see headlines in the press "Energy prices set to rise X% according to industry sources" and they then go on to quote some accountancy firm or consultant. It's not as though you need to climb the Himlalyas and ask a wizened guru in a smoke-filled temple; it's 20 minutes work with a spreadsheet once a month.

"QrizB Consultancy predicts 66% rise in energy prices from April 2022" - you genuinely did read it here first, folks

MWT

savers_united said:

...same for an increased WHD etc, by having it on the unit rate we are not all equally contributing to these costs, a fairer way would be seperate energy costs (unit rate) from fixed costs / obligations (SC).

The WHD is actually the only element of policy costs that is specifically used in the standing charge cap calculation, the rest all go into the total cost cap calculation.

PennineAcute

These figures make me happy that I ignored Martin's advice and fixed when I did.

Using your figures, I estimate that at the end of September, I will be £79 better off by taking a fix in December 21, rather than staying on SVT.

Even allowing for a 10% error I am still around £50 better off

ispookie666

@QrizB Thank you for the fantastic work.