Time to ditch the standing charge?

savers_united

Olinda99 said:

Petrol forecourts don't have a standing charge to cover their fixed costs such as business rates, heating and lighting etc. They don't have a standing charge to cover the costs of tanker delivery. You just pay per litre of fuel bought.

You will probably be better off moving to oil or bottled / LP gas and getting it delivered, at least then you will not pay a SC and it will work more like a petrol forecourt with all costs built in. Then you can work out in a few years if it was worth it, once you have installed and maintained the tanks and they bump up the price because you are buying low quantity. But at least you will avoid having paid a SC. 

Ultrasonic

I am a low energy user but don't feel standing charges are unfair. Also, my energy supplier went bust last year so I benefitted from the SOLR process, like many of us did.

gt94sss2

wakeupalarm said:

Look at telecoms, you don't see the huge increase in costs of moving everyone to fibre loaded on to standing charges.

Ofcom actually allow the line rental for cooper lines to increase at a faster rate than fibre lines to encourage the move to fibre.

facade

What has "fair" got to do with the prices charged by private companies?

They are not philanthropists, their function is to maximise profit.

Having a standing charge is a way to make money from properties that are using little or no energy- why would they not make this as high as they can get away with?

OFGEM introduces an element of  "fairness" by capping the standing charge & unit rates, otherwise it would be a race to the top.

Ultrasonic

facade said:

OFGEM introduces an element of  "fairness" by capping the standing charge & unit rates, otherwise it would be a race to the top.

Not quite, given that pre-cap there used to be tariffs available with zero standing charge.

Mobtr

Could also say that it’s not fair those that have always stayed with the big suppliers for security are now having to pay SoLR costs which they have never benefitted from 

[Deleted User]

Nails101 said:

The standing charge is inherently unfair since each household pays the same no matter how much electricity is used. 

Maybe you could arrange for the electric board to come out and connect your house to the energy network every time you fancy a cuppa then disconnect it after the kettle has boiled. Then you won’t be connected to the network a second more than needs be. 

I think everyone paying the same is the fairest option. The power stills comes from the same source no mater how much each house uses. Still the same costs to keep you connected to the network whether you use 1 or 10k units. 

Thrugelmir

facade said:

What has "fair" got to do with the prices charged by private companies?

They are not philanthropists, their function is to maximise profit.

Having a standing charge is a way to make money from properties that are using little or no energy- why would they not make this as high as they can get away with?

Without profits there's no money to invest in capital projects. Complex topics all too frequently don't get discussed anymore in the media. As few media commentatators have any understanding of the industry. More interested in Mrs Jones from 39 Acacia Avenues opinions. As that makes headlines. 

tghe-retford

Maybe people might feel better if the energy industry followed the example of the mobile phone industry. People who pay by direct debit have a minimum line rental charge, the equivalent of the standing charge, that everyone has to pay before they're allowed to make a single phone call. And then the price per GB depends on how much you use, low users pay more per GB compared to high users. Replace GB with kWh. Unlike with mobile phone networks where you have a set limit of data usage, the yearly electricity and gas usage amount determines the kWh you pay, the less you use, the more you pay per kWh.

And those on PAYG get charged an obscene amount of money per GB. Again, replace GB with kWh. Would following the mobile phone industry standard for charging of resources be fairer?

Because the way that standing charges have been implemented have sent a message that time is up for low users and they gotta pay big time. At a time where we are encouraged to use less energy.

Hysteron

The ultimate Supplier of Last Resort is of course the UK government who had to put Bulb into "special administration" because no energy company would dare take on an extra 1.7 million customers with the current market conditions.

The fact is that there is no scheme that is good enough to protect all consumers of energy from companies going bust without having the government available to step in when it all goes wrong and at the end of the day it is the consumers that will pay every penny of the additional costs of business failures through taxes or energy bills.

FWIW I too believe the increase in standing charges to be a very unfair way of clawing back this money, a number of charitable organisations based in the UK totally agree with that and have produced reports in the past few days that state how the poorest are the most affected and end up paying a far greater % of their income on energy bills as a result.