Quarterly cap change proposed

Section62

wrf12345 said:

Prepayment meters (with no standing charge) that can directly read debit cards and tied to the national grid rather than the energy providers would save circa 40 percent of the bill albeit at the price of paying the direct and variable wholesale rate for gas and electric. Basically eliminating the middle men and making Ofgem redundant (I assume the poor old consumer is financing Ofgem via their bills).

Is there a source for that 40% figure?  (Also bearing in mind a big chunk of what energy suppliers charge retail consumers is accounted for by levies and VAT)

...and also paying for the distribution system from the national grid to the meter in the consumer's property, and for the meter itself (more expensive if it is a debit-card reading prepayment model).

Also, Ofgem do more than just regulate retail suppliers.... one of their tasks is to regulate the national grid.

EssexHebridean

pochase said:

So your solution instead of increasing the standing charges would have been for customers of failed suppliers to lose their money and to fight for themselves to find a new supplier?

The poster you're replying to didn't suggest that for a moment - they were referring to the WAY the SC increase was done, rather than the fact that it was done at al - or that is how I ready their post, in any event. 

QrizB

Section62 said:

wrf12345 said:

Prepayment meters (with no standing charge) that can directly read debit cards and tied to the national grid rather than the energy providers would save circa 40 percent of the bill albeit at the price of paying the direct and variable wholesale rate for gas and electric. Basically eliminating the middle men and making Ofgem redundant (I assume the poor old consumer is financing Ofgem via their bills).

Is there a source for that 40% figure? 

I think it's wishful thinking.

Just under 55% the current cap is made up of wholesale costs. Add 27% for network costs (getting the power from the generators to your door) and policy costs (WHD and the infamous "green levies") and you're already at 82%. That leaves 13% for operating costs, smart meters and the energy companies' own expenses, and 5% VAT to finish.

Section62

EssexHebridean said:

pochase said:

So your solution instead of increasing the standing charges would have been for customers of failed suppliers to lose their money and to fight for themselves to find a new supplier?

The poster you're replying to didn't suggest that for a moment - they were referring to the WAY the SC increase was done, rather than the fact that it was done at al - or that is how I ready their post, in any event. 

The poster's description of it as "a four billion quid theft from energy consumers" tends to negate the alternative interpretation though.  Changing the way the money is collected wouldn't make it less of a "theft" (for those who view it as such).

pochase

EssexHebridean said:

pochase said:

So your solution instead of increasing the standing charges would have been for customers of failed suppliers to lose their money and to fight for themselves to find a new supplier?

The poster you're replying to didn't suggest that for a moment - they were referring to the WAY the SC increase was done, rather than the fact that it was done at al - or that is how I ready their post, in any event. 

The poster did not complaint just about how it was handled, he complaint about a four billion theft. Why call it theft if he does not believe it should not happen? So who is the beneficiary of the theft? Do the energy suppliers are going to keep it or has it to be used for the victims of the suppliers going bust?

Also he claims a £100 increase in electricity standing charge, while the reality is an increase between 8p and 25p per day, that is between £29.2 and £91.25 per year and not £100 for for everybody.

MattMattMattUK

wrf12345 said:

Prepayment meters (with no standing charge) that can directly read debit cards and tied to the national grid rather than the energy providers would save circa 40 percent of the bill albeit at the price of paying the direct and variable wholesale rate for gas and electric. Basically eliminating the middle men and making Ofgem redundant (I assume the poor old consumer is financing Ofgem via their bills).

No they would not, they would get nowhere close to that saving. At most you might save 2-4% and only then if you ignore the huge cost of building in card processing systems to the meters. 

wrf12345 said:

Martin Lewis apologized for his rant at Ofgem but it was a rare moment of honesty regarding an organization that has no real interest in protecting consumers as illustrated by their £100 increase in standing charge for electric and the way it was not included in the initial announcement nor directly obvious in subsequent press releases - a four billion quid theft from energy consumers! It is also completely at odds with Green thinking, causing a massive percent increase in the bills of low energy users (and those with solar panels).

I know you seem to have an issue with the standing charge, but just because you do not like or understand it does not make it theft. 

Ultrasonic

Mstty said:

This may be a bit controversial but I am going to air it anyway.

We were a household with a protected credit under the SoLR protection we received when Symbio went bust.

Personally we took a gamble on Symbio, they were small but offered us a great kWh electricity rate.

Energy has been so cheap for decades. We changed supplier every year, chased the very best fixes price and factored in cashback and referral deals and energy was one of the cheaper DD's on our household budget spreadsheet. It was always going to come crashing down at some point and we knew the gamble we were taking with Symbio. Little did we know our gamble would end up being paid for by everyone else. As per another thread to the tune for dual fuel customers of £310-330 a year in SC alone!!!!!!

It doesn't sit well with us so the amount we had in credit with Symbio we have donated to suitable charities. Hoping it gets to those most affected by our greed for cheap energy.

My take is that if you hadn't known you'd have the SOLR protection that you wouldn't have made the choices you did. I know I wouldn't have made similar decisions myself. Also, everyone had the protection whether they ended up needing it or not. So feeling guilty about this is a bit like making a claim on your car insurance and feeling guilty about those who don't.

I benefited from the SOLR process myself when Pure Planet went bust, although my credit balance was tiny. 

Chrysalis

Mstty said:

This may be a bit controversial but I am going to air it anyway.

We were a household with a protected credit under the SoLR protection we received when Symbio went bust.

Personally we took a gamble on Symbio, they were small but offered us a great kWh electricity rate.

Energy has been so cheap for decades. We changed supplier every year, chased the very best fixes price and factored in cashback and referral deals and energy was one of the cheaper DD's on our household budget spreadsheet. It was always going to come crashing down at some point and we knew the gamble we were taking with Symbio. Little did we know our gamble would end up being paid for by everyone else. As per another thread to the tune for dual fuel customers of £310-330 a year in SC alone!!!!!!

It doesn't sit well with us so the amount we had in credit with Symbio we have donated to suitable charities. Hoping it gets to those most affected by our greed for cheap energy.

Your honesty is good and I praise you for donating it.

I had been tempted to post at times, that I think we should consider having fixed DD credit balances not protected, so the consumer choice of using fixed DD is also been aware of the risk of it.  I ultimately decided against it as generally I am pro consumer, and I think promoting something that could really cause major issues for people who cant afford to lose credit balances I couldnt support.  Hence a watered down proposal eventually got posted for using a independent credit balance entity.

Mstty

Ultrasonic said:

Mstty said:

This may be a bit controversial but I am going to air it anyway.

We were a household with a protected credit under the SoLR protection we received when Symbio went bust.

Personally we took a gamble on Symbio, they were small but offered us a great kWh electricity rate.

Energy has been so cheap for decades. We changed supplier every year, chased the very best fixes price and factored in cashback and referral deals and energy was one of the cheaper DD's on our household budget spreadsheet. It was always going to come crashing down at some point and we knew the gamble we were taking with Symbio. Little did we know our gamble would end up being paid for by everyone else. As per another thread to the tune for dual fuel customers of £310-330 a year in SC alone!!!!!!

It doesn't sit well with us so the amount we had in credit with Symbio we have donated to suitable charities. Hoping it gets to those most affected by our greed for cheap energy.

My take is that if you hadn't known you'd have the SOLR protection that you wouldn't have made the choices you did. I know I wouldn't have made similar decisions myself. Also, everyone had the protection whether they ended up needing it or not. So feeling guilty about this is a bit like making a claim on your car insurance and feeling guilty about those who don't.

I benefited from the SOLR process myself when Pure Planet went bust, although my credit balance was tiny. 

We never knew we had protection. Didn't even know what SoLR was until Symbio went bust. Perhaps you can see from my profile I am new to energy and this board and MSE in general.

So no in this instance I did not know there was an insurance policy protecting my credit. Probably like so many others?

If you wouldn't feel guilty that's your own take but we did. Don't try and explain our guilt to match your non guilt.

Gerry1

Mstty said:

It doesn't sit well with us so the amount we had in credit with Symbio we have donated to suitable charities. Hoping it gets to those most affected by our greed for cheap energy.

Well done for the charitable donation, but there's absolutely no need to feel guilty for not wasting money by needlessly throwing it at Big Energy.

For years we've all been encouraged by the government, Which?, Citizens Advice, MSE, comparison sites et al to switch suppliers frequently to get a better deal, especially those who are vulnerable and/or on low incomes.  Indeed, not so long ago there were plans to identify all the non-savvy users who hadn't switched in the last few years (or had never switched at all) and to write to them urging them to do so.

Choice and competition in the energy market is a good thing, but only if there's good regulation, something at which Ofgem has been utterly dismal.