Held to ransom

MattMattMattUK

weneedawrittenconstitution said:

So let’s look at the following 

We asked Ofgem this question, and it told us the rise is due to: 

• The cost of moving everyone whose firm went bust to new suppliers.
  
  
• Increases in fixed network costs (the cost of maintaining the energy networks). 
  
  
• An increase in policy costs (such as green levies and the rise in the warm home discount rebate).

Point 1 - this cost should have been carried by the taxpayer through the government and recovered from direct taxation.

Why? What merit or benefit is to be had by say raising VAT or Income Tax which may or may not raise the desired revenue to cover the costs, vs raising the standing charge a fixed amount to recover the cost which was primarily to benefit energy using households. 

weneedawrittenconstitution said:

Point 2 - whilst there will have been increased in fixed costs - wages, materials, maintenance, the infrastructure is in place and these costs should come off the bottom line before profits are declared and dividends distributed.

Why? Energy is already at a low margin, something like this could push it further into loss. Additionally most of the cost increase was due to SoLR.

weneedawrittenconstitution said:

Point 3 - Green levies have been in place for some time now and in fact there was talk of reducing these to offset the massive increase in business and domestic energy bills.

There was talk of, but they were not reduced, reducing them would be counter productive. There are also social levies. 

weneedawrittenconstitution said:

So that’s all a bit of a flat argument.

I agree, your argument falls flat. 

MWT

weneedawrittenconstitution said:

Point 2 - whilst there will have been increased in fixed costs - wages, materials, maintenance, the infrastructure is in place and these costs should come off the bottom line before profits are declared and dividends distributed.

These are network costs, and the existing infrastructure needs constant maintenance and improvement, if the cost of that work goes up then the network costs passed on to the energy suppliers will go up, why would you assume that increased costs should be absorbed within the distribution profit margin?

weneedawrittenconstitution

You’re all missing the point. I don’t get a choice in this. I have to pay for something even though I’m not using it!!! So will I have to pay for the upkeep of the national road network even though I don’t have a car? 

robrymond

GingerTim said:

The big increase on the standing is owing to the failure of multiple energy providers - we're all going to be paying for that for some time.

Yes but we'll never see this price decrease. Whenever have standing charges ever dropped? This is routine now just like price rises on beer which never get reversed when costs go down or the chip shop that always rise prices when they have a bad year on potatoes or the poor yield of Cod but when it drops down it never gets reversed. 

Obviously there are other costs associated with the above but the frustrating bit is the standing charge increasing by such a huge amount will now be with us forever and will likely rise further.

Ultrasonic

weneedawrittenconstitution said:

You’re all missing the point. I don’t get a choice in this. I have to pay for something even though I’m not using it!!! 

You are using it.

Ultrasonic

robrymond said:

GingerTim said:

The big increase on the standing is owing to the failure of multiple energy providers - we're all going to be paying for that for some time.

Yes but we'll never see this price decrease. Whenever have standing charges ever dropped? 

We don't know that. There is transparency about what the increase is for, which is not coming from the energy companies themselves. I see no reason to assume that this element won't be removed in time. 

jimjames

weneedawrittenconstitution said:

You’re all missing the point. I don’t get a choice in this. I have to pay for something even though I’m not using it!!! So will I have to pay for the upkeep of the national road network even though I don’t have a car? 

Of course you have a choice. If you're not using it then get your meter removed and you won't be paying any standing charges. Or does your "not using it" mean you are using it really?

And yes you do pay for road network even if you don't own a car - it's paid from taxation.

QrizB

weneedawrittenconstitution said:

So will I have to pay for the upkeep of the national road network even though I don’t have a car? 

Yes, you do, through general taxation. "Road tax" hasn't paid for roads in decades.

In fact, unlike roads, you can stop paying for the energy networks by simply having your supplies disconnected.

Gerry1

weneedawrittenconstitution said:

I have to pay for something even though I’m not using it!!!

Unless your gas pipe and electricity cables have been disconnected, you have the ability to use energy whenever you like.  Supplying and maintaining the pipes, cables, power stations and network infrastructure all costs money and it would be unreasonable for you to be a freeloader subsidised by other consumers, some of whom are likely to be poorer than you are.

You also have to pay for the NHS, schools, Army, Navy, RAF etc even if you are not using their services.

Unlike the above, you can always vote with your feet, i.e. go off grid if you don't want to pay the standing charges.

Ultrasonic

Even those who don't own cars benefit from the road network, via e.g. public transport and goods being delivered.