OFGEM moving to quarterly price cap reviews - confirmed

[Deleted User]

BUFF said:

https://www.telegraph.co.uk/bills-and-utilities/gas-electric/energy-price-cap-could-hit-4400-january/

That in its self is enough reason to avoid giving any advice on whether to fix or not. By all means explain the methodology but who knows what assumptions to build into January and April updates? I admit I haven't a clue.

BUFF

"An Ofgem spokesman said: "The wholesale market continues to move extremely quickly so no forecast for next year is at all robust at this stage, and will therefore have very limited value, especially for consumers who must always be the main priority. 
“We cannot stop others from making predictions but we would ask that extreme caution is applied to any predictions for the price cap in January or beyond.” "

My italics. Basically, we don't know where this rollercoaster ride is going, fasten your seatbelts ...

gt94sss2

GingerTim said:

He also said they are 'looking at the standing charge'.

Ofgem have indicated they are looking at lowering the standing charge and increase the per unit element.

This appears to be as a result of the complaints from low users complaining about the increase in the standing charge.

If they do this, I feel pandering to these voices will be a mistake 

Chrysalis

k_man said:

If the cap is reviewed too frequently, doesn't this then just become a tracking rate, following the wholesale rollercoaster pricing?

Doesn't this also lead to the winter cap being based on summer/autumn prices?

Kind of yep.  Although at 3 month intervals its not a roller coaster its more like a sharp uphill climb.

wild666

sevenhills said:

GingerTim said:

He also said they are 'looking at the standing charge'.

They should be either a zero standing charge' tariff or Ofgem should set the price for the first 2,000 units at zero % VAT.
That would help the poor and help tackle climate change.

Zero % on the first 2000 units/kWh would mean my whole usage of electric would be free saving me £177 per year. Doing this could see suppliers just increase the price per kWh so users still pay some or all the SC for using 2,000 units/kWh or less per year.

[Deleted User]

wild666 said:

sevenhills said:

GingerTim said:

He also said they are 'looking at the standing charge'.

They should be either a zero standing charge' tariff or Ofgem should set the price for the first 2,000 units at zero % VAT.
That would help the poor and help tackle climate change.

Zero % on the first 2000 units/kWh would mean my whole usage of electric would be free saving me £177 per year. Doing this could see suppliers just increase the price per kWh so users still pay some or all the SC for using 2,000 units/kWh or less per year.

Zero standing charge tariffs are also of considerable financial benefit to those who have PV solar, or live in low energy use homes.

Being Devil’s Advocate, why should low users not contribute to the cost of getting energy to their homes, and why should they be protected from environmental and social costs or the cost of supplier failures? Low energy use is not the sole domain of those who are on benefits.

wild666

gt94sss2 said:

GingerTim said:

He also said they are 'looking at the standing charge'.

Ofgem have indicated they are looking at lowering the standing charge and increase the per unit element.

This appears to be as a result of the complaints from low users complaining about the increase in the standing charge.

If they do this, I feel pandering to these voices will be a mistake 

All this will do, IMHO, is change the SC from the highs it is now onto the cost of 1 kWh of electric and penalise high users even more.

Sea_Shell

They'll get their pound of flesh one way or another! ☹️


(Ooh, there's a song in there somewhere)