High standing charges for gas and electric.

pensioner2

Possibly my final comment is that in my opinion, it is fairer if energy companies are forced to behave like all other businesses and provide and maintain the infrastructure from profits made providing their goods[energy].   It is possible to adjust your own spending by using less but you cannot avoid the present standing charges.      I wonder if the person who suggested avoiding standing charges by being disconnected believes it is possible to avoid death from hypothermia by suicide.

MattMattMattUK

Sea_Shell said:

Astria said:

GingerTim said:

pochase said:

If you look at this Ofgem block from 25th of May, they are not reviewing the whole standing charge, but just the SOLR portion of it,

https://www.ofgem.gov.uk/news-and-views/blog/how-ofgem-responding-energy-crisis

Ofgem Chief Executive Jonathan Brearley set out how we are working to make the retail energy market more resilient at the BEIS select committee yesterday (24th May 2022)

If we find evidence of suppliers not treating consumers fairly or complying with our rules, we will take swift action and make full use of our enforcement powers. Equally, we have heard concerns from consumer groups around charges. Therefore, we will review the allocation of the SOLR levy between standing and volumetric charges to ensure they are fair for all consumers, and will be coming forward with our thinking very soon.

So how could that work. Will they add x P to every KWh electricity until the SOLR cost is paid off? 

At the moment it is still at the status they are reviewing it, not that they will really change something. I am interested to learn what they believe is fair for all consumers. 

I'm not convinced that shifting the SOLR cost onto 45p+/kwh unit rates would be any more popular!

It sounds like they may come up with a plan that vulnerable customers will be supported more and possibly pay less, compensated for by government and thus funded by the people who don't qualify as being vulnerable. Whether this is funded through energy bills or other taxes we don't yet know. Maybe we'll start seeing tariffs for vulnerable/low income people only?

Then they need to come up with an answer to the pre-pay meter cost disparity first, as it's mostly (AIUI) low income households that are most likely to be on pre-pay....paying more.

The thing with the pre-pay meters is that there is almost no disparity in cost any more, in most regions the standing charge is slightly higher and the unit cost is slightly lower meaning based on Ofgem's favourite "average user" the the cost of pre-payment is only 2.3% higher which in almost certainly does not cover the additional cost of the pre-payment system.

Sea_Shell said:

Which could trigger a flood of people wanting to move to pre-pay meters to benefit from these new tariffs.   So some sifting of "need" would be required... who'd do that?  Who'd pay for the extra admin of implementing that?

Would they have to be state funded "social" tariffs?

I really cannot see the argument for social tariffs, it makes no sense to offer both benefits to pay the social tariff with and a social tariff which then has additional administration costs, the only sensible solution is to pay benefits at a level adequate to live and allow people to make their own choices with that money.

QrizB

pensioner2 said:

I wonder if the person who suggested avoiding standing charges by being disconnected believes it is possible to avoid death from hypothermia by suicide.

It's certainly possible to live in the UK without mains electricity or mains gas and not die of hypothermia.

It's not clear to me where suicide comes into it but roughly 1 in 10000 (0.01%) of the UK's population die by suicide each year, while 6% of the population have attempted it at some point. This suggests to me that most people who attempt it avoid death by suicide, too.

Gerry1

pensioner2 said:

...it is fairer if energy companies are forced to behave like all other businesses and provide and maintain the infrastructure from profits made providing their goods[energy].

It isn't the case that all other businesses and provide and maintain the infrastructure from profits made providing their goods.

Landline rental still has to be paid even if you don't make any calls.

MattMattMattUK

pensioner2 said:

Possibly my final comment is that in my opinion, it is fairer if energy companies are forced to behave like all other businesses and provide and maintain the infrastructure from profits made providing their goods[energy].  

There are only two other sectors (water and telecoms) that have to maintain a connection direct to people's home and both operate a somewhat similar system, although telecoms has moved to an all you can eat model in recent years, but then telecoms have no generation/production cost. Also, energy is a regulated market, the market cannot currently function properly and for most of the last year energy providers were forced to sell below cost, they were not making any profit because the regulator did not allow them to, it actually forced them to sell their product below cost. That being said, where there is a fixed cost of being connected to the network, as well as a consumption cost, the standing charge and unit cost model makes most sense and is rationally the most "fair" system".

pensioner2 said:

It is possible to adjust your own spending by using less but you cannot avoid the present standing charges.   

You can avoid the standing charges, many people do not pay them for gas by either using bottled gas or tank LPG and if you wanted to avoid electricity standing charges a few Powerwalls, 8-10kw of Solar and probably a backup LPG generator would do the trick, of course that would be a lot more expensive.

pensioner2 said:

I wonder if the person who suggested avoiding standing charges by being disconnected believes it is possible to avoid death from hypothermia by suicide.

Of course it is possible to avoid death from hypothermia whilst not being connected to the energy grid. Modern humans have been around for approximately two hundred thousand years, we have only had a national energy infrastructure in the UK for a since the late 19th centaury. Even now around 14% of dwellings to not have a gas connection and an estimated one hundred thousand do not have a connection to the electricity grid. 

You seem to want something, a connection to a functioning and maintained energy grid, but you do not wish to pay for it. In what way is that position "fair" on those who would have to pay for it whilst you get to use it for free, or rational?

Alnat1

The government has already decided you will receive £400 off your energy bill, plus as a pensioner you will get another £300. 

Just how much of other people's (tax payers) money do you want before you'll think it's "fair"

pensioner2

I have been a tax payer for 65 years and have had to accept that some people take out more than they put in.    The case I make for removing the energy companies standing charge  is not about me.       The energy market needs drastic changes.     I have previously commented about the money wasted on so called smart meters which could have been replaced with Credit and Load Management units which I trialed 40 years ago.

MattMattMattUK

pensioner2 said:

I have been a tax payer for 65 years and have had to accept that some people take out more than they put in.

The key question is rarely how long someone has been a taxpayer for, but for many many years if any they were a net contributor for and if they maintain that status. The vast majority of people take out/cost more than they put in, in any one year only around a third of people make a net contribution, over a lifetime it is a single digit percentage. None of that is relevant to the energy market.

pensioner2 said:

The case I make for removing the energy companies standing charge  is not about me. 

You seem to want a system which favours you, over one which is rational, that would tend to indicate you think it is about you.

pensioner2 said:

The energy market needs drastic changes.

The energy market probably does need significant change, but reducing standing charges is not that change. It needs huge investment in nuclear and renewables to guarantee supply and reduce (ultimately to zero) emissions. Energy was too cheap for too long because we as a nation failed to adequately invest in guaranteed supply, however British politics and the British public generally prefer short term gain for long term pain, rather than a more balanced view.

pensioner2 said:

I have previously commented about the money wasted on so called smart meters which could have been replaced with Credit and Load Management units which I trialed 40 years ago.

Just because you label something "so called" does not change it's usefulness. The smart meters have been expensive to roll out, however rolling out 40 year old technology would have been similarly expensive as well as idiotic for using a defunct and archaic technology. 

We get it, you want your energy to be cheaper and you want that to be subsidised by other people. That is not a fair or rational position, it is inherently selfish, no one is arguing with your right to hold that opinion, but very few other people, especially those who want to aim for some semblance of fairness or rationality support your position. 

pensioner2

The C.A.L.M.U. technology was more advanced and useful to the consumer even without the advances which could have been applied in the last 40 years.     I responded to the comments about pensioners taking from other tax payers.It will take many years of government handouts before I am in  credit..      The people being selfish are those wishing to keep the present standing charge system which penalises the less well off.    You have no knowledge of my finances to make a judgement about  my gain or loss from removing the standing charge.    I am being objective about a system which I perceive to be unfair.    I have no problem with opposing views.  I do object to the arrogance of people [we get it] who make false assumptions and claim to speak for others.    

markin

pensioner2 said:

Possibly my final comment is that in my opinion, it is fairer if energy companies are forced to behave like all other businesses and provide and maintain the infrastructure from profits made providing their goods[energy].   It is possible to adjust your own spending by using less but you cannot avoid the present standing charges.      I wonder if the person who suggested avoiding standing charges by being disconnected believes it is possible to avoid death from hypothermia by suicide.

If it was added to the first 2 KWH of the day you would still not avoid paying it, It would just be hidden and relabeled.