Am I calculating the impact of the energy price rises correctly?

karcady

I've built a spreadsheet to try and calculate whether my offered fix (Loyal Octopus 12M) is a good deal. (Specifically I'm worried that fixing to a higher rate in the higher-usage months of November and December might wipe out the benefits of being fixed to a below-the-price-cap rate in spring.)

First, I've tried to convert the average-use whole-year numbers from Cornwall Insight's 22nd August blog post and their 26th August blog post into a percentage increase to the unit price (by subtracting the standing charge):

	Day	Year	Pounds/year			Q422	Q123	Q223	Q323
Standing charge (gas)	27.22	9935.3	£99.35		Electricity base	1679.35	2212.32	2365	2052
Standing charge (electricity)	43.12	15738.8	£157.39		Electricity w/o standing charge	£1,521.96	£2,054.93	£2,207.61	£1,894.61
					Gas base	1874	2437	2975	2715
					Gas w/o standing charge	£1,774.65	£2,337.65	£2,875.65	£2,615.65
					Electricity increase (from Q422)		35.02%	45.05%	24.48%
					Gas increase (from Q422)		31.72%	62.04%	47.39%
					Electricity unit price	52	70.21	75.43	64.73
					Gas unit price	15	19.76	24.31	22.11
						Q422	Q123	Q223	Q323
					Electricity base	1679.35	2505	2834	2445
					Electricity w/o standing charge	£1,521.96	£2,347.61	£2,676.61	£2,287.61
					Gas base	1874	2881	3782	3452
					Gas w/o standing charge	£1,774.65	£2,781.65	£3,682.65	£3,352.65
					Electricity increase (from Q422)		54.25%	75.87%	50.31%
					Gas increase (from Q422)		56.74%	107.51%	88.92%
					Electricity unit price	52	80.21	91.45	78.16
					Gas unit price	15	23.51	31.13	28.34

Then I've taken my monthly usage from last year, and compared the fixed rates vs. the two projected price cap rises (all prices in pence except where there's a £ sign):

Month	Usage (elec)	Usage (gas)	Elec fix	Gas fix	Cost	Elec price cap (22nd Aug numbers)	Gas price cap (22nd Aug)	Cost (22nd Aug)	Fix saving (22nd Aug)
Sept	154.9	178	67.98	18.88	13890.742	27.22	7.48	5547.818	-£83.43
Oct	165.5	332	67.98	18.88	17518.85	52	15	13586	-£39.33
Nov	185.1	1065	67.98	18.88	32690.298	52	15	25600.2	-£70.90
Dec	220.1	1401	67.98	18.88	41413.278	52	15	32460.2	-£89.53
Jan	191.48	1783	67.98	18.88	46679.8504	70.21	19.76	48675.8908	£19.96
Feb	170.5	1351	67.98	18.88	37097.47	70.21	19.76	38666.565	£15.69
Mar	180.2	1021	67.98	18.88	31526.476	70.21	19.76	32826.802	£13.00
Apr	152.8	682	67.98	18.88	23263.504	75.43	24.31	28105.124	£48.42
May	138.6	225	67.98	18.88	13670.028	75.43	24.31	15924.348	£22.54
Jun	125.9	188	67.98	18.88	12108.122	75.43	24.31	14066.917	£19.59
July	141.9	143	67.98	18.88	12346.202	64.73	22.11	12346.917	£0.01
Aug	127	181	67.98	18.88	12050.74	64.73	22.11	12222.62	£1.72
Sum	1953.98	8550			£2,942.56			£2,800.29	-£142.26

Month	Usage (elec)	Usage (gas)	Elec fix	Gas fix	Cost	Elec price cap (26th Aug numbers)	Gas price cap (26th Aug)	Cost (26th Aug)	Fix saving (26th Aug)
Sept	154.9	178	67.98	18.88	13890.742	27.22	7.48	5547.818	-£83.43
Oct	165.5	332	67.98	18.88	17518.85	52	15	13586	-£39.33
Nov	185.1	1065	67.98	18.88	32690.298	52	15	25600.2	-£70.90
Dec	220.1	1401	67.98	18.88	41413.278	52	15	32460.2	-£89.53
Jan	191.48	1783	67.98	18.88	46679.8504	80.21	23.51	57276.9408	£105.97
Feb	170.5	1351	67.98	18.88	37097.47	80.21	23.51	45437.815	£83.40
Mar	180.2	1021	67.98	18.88	31526.476	80.21	23.51	38457.552	£69.31
Apr	152.8	682	67.98	18.88	23263.504	91.45	31.13	35204.22	£119.41
May	138.6	225	67.98	18.88	13670.028	91.45	31.13	19679.22	£60.09
Jun	125.9	188	67.98	18.88	12108.122	91.45	31.13	17365.995	£52.58
July	141.9	143	67.98	18.88	12346.202	78.16	28.34	15143.524	£27.97
Aug	127	181	67.98	18.88	12050.74	78.16	28.34	15055.86	£30.05
Sum	1953.98	8550			£2,942.56			£3,208.15	£265.60

So based on the numbers from 22nd August my fix would cost me £140 a year, but going off the numbers from 26th August it would save me £265.

Do my maths (and inbaked assumptions - e.g. that the standing charge will stay the same and all the variation will be in the unit rate) check out? Has anyone else tried to do this analysis for fixes they've been offered?

[Deleted User]

I think the latest predictions suggest that electricity standing charge will come down in April.

Basically though, you're doing the right maths.  Each month's usage, multiplied by each month's price.

The judgement is - do you think the predictions are too low, just right, or too high?

[Deleted User]

Here's Auxilione's last published prediction for the future unit price and standing charge caps (25 August) - there's a variation between regions as well, but that won't be known until the day OFGEM publishes I think.

Malkytheheed

Isn't it just a simple case of both gas and electric going up 80% in October? 

pochase

No it is not. The percentage increases for gas units, electricity units, standing charge gas and standing charge electricity are all different.

The overall percentage for the four is 80% for the whole country. Now add that there are 13 different regions with different rates, whereby the percentages within the regions should be not much different.

pochase

The forecast from Friday posted by @[Deleted User] is already replaced by a more expensive one this morning.

PZ19

[Deleted User] said:

Here's Auxilione's last published prediction for the future unit price and standing charge caps (25 August) - there's a variation between regions as well, but that won't be known until the day OFGEM publishes I think.

That electric unit price forecast is genuinely frightening!