October Price Cap and standing charges

007apm

Standing charges on our dual fuel bill currently stand at £20 per month.  A 50% increase as predicted would take this to £30 per month regardless of usage.  The state pension amounts to £141.85 per week or ~£615 per month.  Standing charges at £30 would approach 5% of the pension before any energy is used.  There are rumours that the standing charge could increase disproportionally to cover the cost of 'failure'  which would make the situation worse for low usage/ low income households.  Is this a valid concern?

pochase

Of course nobody knows what is going to happen, but the standing charges are not expected to increase, or at least not by any significant amount.

What you call the cost of failure, the cost for the SOLR process has already been added in April to the standing charges.

MWT

You are about 6 months behind on this one, the standing charge already increased to cover the costs of the failures, the next round of price increases in October will hit the unit. charges much more than the standing charges.

You are also ignoring all of the support payments which will have a greater impact on those same households that you are concerned about.

Mstty

However the 1billion gap for bulb until it is sold may end up on the standing charge. But probably next April when it's noticed less.

MattMattMattUK

Mstty said:

However the 1billion gap for bulb until it is sold may end up on the standing charge. But probably next April when it's noticed less.

The special administration of Bulb is expected to cost at least £3 billion and that is if it can be disposed of or largely wound down by the end of FY 22/23, in all likelihood it will end up costing taxpayers £3.5+ billion depending on when exactly the government can dispose of it.

pochase

Bulb will cost a lot, but it will come direct out of the tax pot as they are not part of the SOLR.

diystarter7

Should they not ban standing charges or at least cap them at lets say 10 quid. Then an easier and clear, easy to understand tariff comparison for most of us.

The reason these compaines just like the broadband lot until it was ordered to cealr up their mess, they show prices in a confusing way so it looks better than it is.

If cap was fixed, more people would be be able to work out what they will be paying IMHO.

MattMattMattUK

diystarter7 said:

Should they not ban standing charges or at least cap them at lets say 10 quid. 

No. Standing charges are supposed to reflect the cost of the grid/network connection, so it is fair that they reflect that. An arbitrary cap makes no sense.

diystarter7 said:

Then an easier and clear, easy to understand tariff comparison for most of us.

Tariffs are easy and clear to understand. Standing Charge and Unit Rate, hardly neuroscience.

diystarter7 said:

The reason these compaines just like the broadband lot until it was ordered to cealr up their mess, they show prices in a confusing way so it looks better than it is.

Broadband does not have a unit cost because there is no real cost difference between someone using 10MB a month and someone using 100TB per month.

diystarter7 said:

If cap was fixed, more people would be be able to work out what they will be paying IMHO.

People can work out what they will be paying, it is a daily rate stated on their tariff, not some complicated and variable figure. 

MWT

MattMattMattUK said:

Broadband does not have a unit cost because there is no real cost difference between someone using 10MB a month and someone using 100TB per month.

There are actually considerable cost differences in the provision of the backhaul/backbone bandwidth, but fortunately there are still sufficiently few people trying to download the entire internet compared to those using little more than email and a bit of web surfing that the outliers get lost in the averages.

diystarter7

MattMattMattUK said:

diystarter7 said:

Should they not ban standing charges or at least cap them at lets say 10 quid. 

No. Standing charges are supposed to reflect the cost of the grid/network connection, so it is fair that they reflect that. An arbitrary cap makes no sense.

diystarter7 said:

Then an easier and clear, easy to understand tariff comparison for most of us.

Tariffs are easy and clear to understand. Standing Charge and Unit Rate, hardly neuroscience.

diystarter7 said:

The reason these compaines just like the broadband lot until it was ordered to cealr up their mess, they show prices in a confusing way so it looks better than it is.

Broadband does not have a unit cost because there is no real cost difference between someone using 10MB a month and someone using 100TB per month.

diystarter7 said:

If cap was fixed, more people would be be able to work out what they will be paying IMHO.

People can work out what they will be paying, it is a daily rate stated on their tariff, not some complicated and variable figure. 

I've thanked you as most of your post is sensible.
However, re standing charges "hardly neuroscience," what you conveniently forget is not everyone has the same capacity to understand things and that is a fact. You made an assumption that everyone has your knowledge, they don't but most will have other knowledge that you dont have.

If standing charges were removed or fixed across all suppliers at let's say 10 quid, it is a fact that it would be much, much easier to compare and understand prices when comparing suppliers, EG -  all suppliers standing charge 10 quid - Elect  50p and gas 50p.  That indeed would make it much easier as there is no need to make simple things more complex for the sake of it.

Slight OT but a lot of silly people in England still feel the old imperial units are the best, lol. Most will agree that it is much easier for all to divide 100 than it was 240p or a 1KG vs 1 stone, lol.

Thank you for your post most of which I agreed with but there is no valid reason to make stuff more complex when it can be done more easily. The reason suppliers of gas/elec do this is to confuse most people

Have a lovely day in the sun.

MWT

diystarter7 said:

If standing charges were removed or fixed across all suppliers at let's say 10 quid, it is a fact that it would be much, much easier to compare and understand prices when comparing suppliers, EG -  all suppliers standing charge 10 quid - Elect  50p and gas 50p.  That indeed would make it much easier as there is no need to make simple things more complex for the sake of it.

It would not however reflect the reality of the actual costs, so it might be easier, but it would be wrong...