Energy cap (54%) calculation formula

cmosneanu

Hello
I'm struggling to calculate and reach the 54% result of the price cap increase.

I have used the official values:

1st april 2022 Cap
Unit rate / kwh	Standing /day	Unit rate / kwh	Standing /day
7.37	27.22	28.34	45.34
31st March 2022 Cap
Unit rate / kwh	Standing /day	Unit rate / kwh	Standing /day
4.07	26.12	20.8	24.88

According to my calculation (new-old)/old, i get the following results:

Unit rate / kwh	Standing /day	Unit rate / kwh	Standing /day
81.08%	4.21%	36.25%	82.23%

The average of these 4 is 50.94%.

Is my math wrong? Can you please help me out?
Thanks in advance!

pochase

You need to base your calculations on 12000KWh of gas and 3100KWh of energy. Standing charges are for 365 days, not just 1 day.

The 54% is for the above scenario and does not work on any other usage. Add to that the unit rates and standin g charges are different depending on the region

Not sure what you want to do with this? Even if you find it is 40% or 80% nothing will change to the rates suppliers are charging.

QrizB

cmosneanu said:

The average of these 4 is 50.94%.
Is my math wrong? Can you please help me out?

Yes, your maths is right but you're doing the wrong calculation.

54% is the increase for a dual-fuel customer using 2900kWh/yr of electricity and 12000kWh/yr of gas, who will have seen their bill rise from a typical £1277/yr to £1971/yr - an increase of 54.3%.

You're comparing the individual components but aren't weighting them to reflect average consumption.

There's a fairly detailed explainer of how the cap works at the link in my signature.

Reed_Richards

Your maths is correct but your logic is wrong; it's meaningless to take an average of 4 percentage increases.  Maybe this article will help? https://www.ofgem.gov.uk/publications/price-cap-increase-ps693-april