Price Cap - Standing charge increases

colingordon

According to your estimates of the new price cap rates for 01 April 22, the electricity standing charge goes up from 24.88 p/day to 45.34 p/day. This is a massive 82% increase. How can this be justified when the gas standing charge increase is around 4%? 

MattMattMattUK

colingordon said:

According to your estimates of the new price cap rates for 01 April 22, the electricity standing charge goes up from 24.88 p/day to 45.34 p/day. This is a massive 82% increase. How can this be justified when the gas standing charge increase is around 4%? 

This has been asked, discussed and explained on dozens of other threads.

emmajones1976

Because the gas unit rate is going up a lot more than the electric unit rate.

Thats it.

Curiousgirl1

And because a levy has been applied of £68 p/y to cover the all the SoLR costs for the companies that have gone bust. Added to electric as everyone has this & not everyone has gas. However if you had read the numerous threads which discusses this, you would already know 

wrf12345

Once the levy has been paid over the year, will the s/c decreade by £68? Also good to know that when the companies are in profit that profit, by the same logic of the levy, will be applied to customer accounts by way of a yearly discount.

MWT

wrf12345 said:

Once the levy has been paid over the year, will the s/c decreade by £68? Also good to know that when the companies are in profit that profit, by the same logic of the levy, will be applied to customer accounts by way of a yearly discount.

The levy is a clear component of the calculation of the Ofgem cap, so it is very visible and easy to monitor if it is there or not, which is why so many are able to answer the question so easily...

The levy has nothing to do with the profits or losses of the surviving energy companies, so no, it is not logical to expect a 'discount' in future, it is just about recovery of the costs associated with the protection provided to customers through the SoLR scheme.

Ultrasonic

wrf12345 said:

Also good to know that when the companies are in profit that profit, by the same logic of the levy, will be applied to customer accounts by way of a yearly discount.

There is a minor distinction between a company going bust and customers being protected by being taken on by other companies, and a company that is still trading making a profit...

wrf12345

The levy should come out of future company profits of those remaining not customer's pockets but it seems logical that if customers are to pay for broken companies they should also have a share of the profits. I don't see why they should have it both ways.

jimpwarsop

wrf12345 said:

The levy should come out of future company profits of those remaining not customer's pockets but it seems logical that if customers are to pay for broken companies they should also have a share of the profits. I don't see why they should have it both ways.

If you wish to share in the profits of power companies....................buy shares in the companies.

MWT

wrf12345 said:

The levy should come out of future company profits of those remaining not customer's pockets but it seems logical that if customers are to pay for broken companies they should also have a share of the profits. I don't see why they should have it both ways.

Why should those who were prudent and managed their companies well be forced to pay for the protection of customers who chose to go with high-risk, and generally poorly managed companies who were competing with them?

It would be fairer perhaps to recover the costs of the SoLR protect from just those customers who needed to be protected, instead of those who chose more wisely where to buy their energy?

... but I doubt you would agree to that so mutualising the cost, much like an insurance policy, seems to be the next best thing.

Ultrasonic

wrf12345 said:

The levy should come out of future company profits of those remaining not customer's pockets but it seems logical that if customers are to pay for broken companies they should also have a share of the profits. I don't see why they should have it both ways.

The important point is we're talking about differentcompanies. Why should companies that haven't gone bust be out of pocket because others have?