The new price cap standing charges

poppy10_2

littleteapot said:

poppy10_2 said:

GingerTim said:

How do you think electricity and gas get to our homes?

The infrastructure hasn't magically changed over the last year to justify a trebling in standing charges

It still has to be maintained for safety and reliability. The most obvious example I see is the last two years where cadent have been digging up all the ancient, corroded gas pipes and replacing them in this area. I assume this activity will have to cover the whole country. It certainly seems to me to justify the standing charge, on gas at least.

Similar happens with electricity distribution. Cables, substations etc don't last forever...

There have always been maintenance costs for infrastructure. My point is those costs haven't magically trebled over the past year. Two years ago we still had corroded gas pipes that needed replacing, substations and cables that needed repair etc

[Deleted User]

Slumbershade said:

Is there any clear way to show that it needed to increase this much?

https://committees.parliament.uk/committee/365/business-energy-and-industrial-strategy-committee/news/165039/ofgem-evidence-reveals-potential-24bn-fallout-from-energy-firm-collapses/

MWT

poppy10_2 said:

There have always been maintenance costs for infrastructure. My point is those costs haven't magically trebled over the past year. Two years ago we still had corroded gas pipes that needed replacing, substations and cables that needed repair etc

Nor have the standing charges 'trebled' in the last 12 months, doubled is closer to it when you compare using the capped SVT, and as already explained the majority of the increase was down to the protection of the customer balances on the failed suppliers.

The network costs have gone up noticeably in some regions and mostly that is down to the very damaging storms which occurred, and to some extent actually getting on and doing the maintenance work which has been getting more pressing, but is now actually being done...

The gas pipe replacements are not a frequent occurrence, the ones being replaced around here are mostly about 60-70 years old, but the way the infrastructure is financed they cannot build up a fund over time, nor spread that cost into the future, it has to be covered in the years in which the work is done, so yes those costs are hitting now, in the same way as the excessive storm damage is costing us now...

What_time_is_it

[Deleted User] said:

What_time_is_it said:

I'd like to see standing charges abolished and the cost aborbed into a higher unit rate.
The main argument for standing charges seems to be that without it, higher users would be subsidising lower users. To that I say, good. 

You might - but what about the struggling family with a child at home on dialysis? What about the home with solar that imports no energy during the summer months? Under your proposal, they would pay nothing towards Grid operating costs; green levies; social levies such as WHD etc. This is why companies like Ebico stopped offering zero standing charge tariffs: they couldn't make money out of customers who paid them nothing but who still wanted billing; meter support etc.

There are ways of charging people less who use less by making use of smart meters. For example, many countries have a power limit in kW: that is, if the consumer agrees to a 5kW limit, the consumer will pay less for a given amount of electricity in kWh than a consumer with a 7kW limit. Similarly, time-of-use tariffs; if the consumer can shift energy use to times when demand exceeds supply then they will ending up paying less than a consumer that cannot.

To clarify, I live a fairly high usage household and we also help to cover the costs of my mother-in-law who has extremely high usage. An end to standing charges would definitely cost us a lot more.
But overall, I think abolishing them and incorporating these costs into a unit rate is a fairer way to go. It would incentivise lower usage which would be paid for by those who use the most. 
The issue around 2nd homes is an interesting one. There must be a way around this too?
But overall my point is not about what's best for me, but about what I think is the fairest solution. We have to move away from an "I'm alright Jack" attitude on this.

jrawle

What_time_is_it said:

[Deleted User] said:

What_time_is_it said:

I'd like to see standing charges abolished and the cost aborbed into a higher unit rate.
The main argument for standing charges seems to be that without it, higher users would be subsidising lower users. To that I say, good. 

You might - but what about the struggling family with a child at home on dialysis? What about the home with solar that imports no energy during the summer months? Under your proposal, they would pay nothing towards Grid operating costs; green levies; social levies such as WHD etc. This is why companies like Ebico stopped offering zero standing charge tariffs: they couldn't make money out of customers who paid them nothing but who still wanted billing; meter support etc.

There are ways of charging people less who use less by making use of smart meters. For example, many countries have a power limit in kW: that is, if the consumer agrees to a 5kW limit, the consumer will pay less for a given amount of electricity in kWh than a consumer with a 7kW limit. Similarly, time-of-use tariffs; if the consumer can shift energy use to times when demand exceeds supply then they will ending up paying less than a consumer that cannot.

To clarify, I live a fairly high usage household and we also help to cover the costs of my mother-in-law who has extremely high usage. An end to standing charges would definitely cost us a lot more.
But overall, I think abolishing them and incorporating these costs into a unit rate is a fairer way to go. It would incentivise lower usage which would be paid for by those who use the most. 
The issue around 2nd homes is an interesting one. There must be a way around this too?
But overall my point is not about what's best for me, but about what I think is the fairest solution. We have to move away from an "I'm alright Jack" attitude on this.

It's refreshing to hear someone who is a high user advocating the scrapping of standing charges. Most of the threads on "Scrap the unfair standing charge" etc. are indeed started by low users. However, it is still only your opinion that this would be the "fairest solution". I don't think many of the regular users on here who patiently explain the origin of standing charges do so because they personally gain from them.

With no standing charge, the only "way around" second home owners paying next to nothing would be to introduce a load of extra bureaucracy, which would have to be paid for, which would end up being added to everyone's bills (with high users again paying more for the scheme, which benefits low users!)

What_time_is_it

jrawle said:

What_time_is_it said:

[Deleted User] said:

What_time_is_it said:

I'd like to see standing charges abolished and the cost aborbed into a higher unit rate.
The main argument for standing charges seems to be that without it, higher users would be subsidising lower users. To that I say, good. 

You might - but what about the struggling family with a child at home on dialysis? What about the home with solar that imports no energy during the summer months? Under your proposal, they would pay nothing towards Grid operating costs; green levies; social levies such as WHD etc. This is why companies like Ebico stopped offering zero standing charge tariffs: they couldn't make money out of customers who paid them nothing but who still wanted billing; meter support etc.

There are ways of charging people less who use less by making use of smart meters. For example, many countries have a power limit in kW: that is, if the consumer agrees to a 5kW limit, the consumer will pay less for a given amount of electricity in kWh than a consumer with a 7kW limit. Similarly, time-of-use tariffs; if the consumer can shift energy use to times when demand exceeds supply then they will ending up paying less than a consumer that cannot.

To clarify, I live a fairly high usage household and we also help to cover the costs of my mother-in-law who has extremely high usage. An end to standing charges would definitely cost us a lot more.
But overall, I think abolishing them and incorporating these costs into a unit rate is a fairer way to go. It would incentivise lower usage which would be paid for by those who use the most. 
The issue around 2nd homes is an interesting one. There must be a way around this too?
But overall my point is not about what's best for me, but about what I think is the fairest solution. We have to move away from an "I'm alright Jack" attitude on this.

It's refreshing to hear someone who is a high user advocating the scrapping of standing charges. Most of the threads on "Scrap the unfair standing charge" etc. are indeed started by low users. However, it is still only your opinion that this would be the "fairest solution". I don't think many of the regular users on here who patiently explain the origin of standing charges do so because they personally gain from them.

With no standing charge, the only "way around" second home owners paying next to nothing would be to introduce a load of extra bureaucracy, which would have to be paid for, which would end up being added to everyone's bills (with high users again paying more for the scheme, which benefits low users!)

Good point! I'm not sure what the solution is, but the current set up seems unfair on lower users to me.