Energy price cap freeze on a fixed tariff

[Deleted User]

in_my_bumble_opinion said:

Deleted_User said:

in_my_bumble_opinion said:

No reduction would surely put the government on dodgy legal ground. 

Yeah, it really wouldn't.  In the same way as it isn't interfering with your contract if they change the tax rules when you are already employed, or the BoE changes interest rate when you already have a mortgage.

In fact, surely in the case of a fix that doesn't get a discount they're actually doing nothing to the contract and it is remaining exactly as was signed.

It's not the same as your two examples at all. People become employed and take out mortgages knowing those two things can and will happen over a period of time. 

Still doesn't make it illegal.  And several people on here did accurately predict that there would be some form of government assistance.  Or are you trying to suggest that it's illegal for the government to introduce any new policy that hasn't previously been predicted?  What proportion of the population need to understand that things "can and will happen" before it reaches your threshold of legality?

Nice to see you ignored the second point as well.

PeteHl

You're missing the point. Govt are subsidising, aboloshing green levy etc as part of the deal, yet we who paid more than current cap for 3.5 months but marginally less than new subsidised cap, are giving our subsidy to energy company.

gt94sss2

PeteHl said:

You're missing the point. Govt are subsidising, aboloshing green levy etc as part of the deal, yet we who paid more than current cap for 3.5 months but marginally less than new subsidised cap, are giving our subsidy to energy company.

As others have said, wait - as we don't know what the new rates will be.

Assuming this is a floor, and if your rates are below this, then there won't be any subsidy on your account, saving the taxpayer some money. It won't go to the energy company.

[Deleted User]

I'm not missing the point.  A new rule was made that says X will apply from 1 Oct.  This also applies to you, from 1 Oct.

In every arrangement, change, decision, deal, subsidy or anything else, some will come out of it better than others.  That's life.

It's not illegal, it's not immoral, nobody is being persecuted or picked on.

You will be paying less than the cap - and actually quite a lot of people will still end up paying more than you. 

A rule has been announced, so deal with it like a grown up.  Nothing else matters, however much people cry foul.

jak22

I guess there will always be 'its tough' posts and silly analogies etc here but what we should be looking for over coming days is clarification on 

From the Govt fact-sheet -
- which tariffs are "a fixed tariff at a higher rate caused by recent energy price rises" 
- why there is a fixed discount regardless of how much you're paying "unit prices will be reduced by 17p/kWh for electricity and 4.2p/kWh for gas" 
- what the discounts are for E7

How suppliers are implementing the rules, for instance EDF say -
"fixed tariffs which are priced below the £2,500 price" -> "you'll be able to stay on these prices"
"fixed tariffs which are priced above the £2,500 price" -> "We're working through the detail as to what extent discounts apply here as it is a little more complicated"

A fixed discount that becomes available if you're on a fixed tariff above the new cap might lead to 
.Current.......New Cap rate  .................................. Oct Cap rate ........................
                                |                          |                            |                                 |
                      No discount                  |                            |                                 | 
                                                           |                            |                                 |
                                                           |                            |                                 |
     Cheap  <----------------------------------                           |                                 |
                                                                                        |                                 |
                      New Cap rate  <----------------------------------                                 |
                                                                                                                          |
                                                     Above New Cap <----------------------------------  

MWT

jak22 said:

From the Govt fact-sheet -
- which tariffs are "a fixed tariff at a higher rate caused by recent energy price rises" 
- why there is a fixed discount regardless of how much you're paying "unit prices will be reduced by 17p/kWh for electricity and 4.2p/kWh for gas" 

I expect we'll here the answers on these during the next week, but I expect the fixed discount represents the maximum the government are contributing and if that isn't enough to get the contract people are on down to the new SVT level then they are going to have to take the steps to cancel their contract and move to the new SVT.

I'm still expecting to see a floor set at the level of the new SVT, but their are certainly hints from some suppliers that it is going to be lower than that...

Time will tell...

robbo990

Seems to imply what was stated on the government website that more expensive fixed tariffs will receive the 17p/4.2p even if it doesn't bring them down to the cap.

Domestic customers may have chosen - before the announcement - to get ahead of price rises expected in the future by choosing a fixed tariff.

If that was more expensive than the new capped rate then the government has said these customers will receive the equivalent discount.

In precise terms, that is an automatic reduction in unit prices of 17p per kWh for electricity and 4.2p per kWh for gas - which is the equivalent of £1,000 or so for a household using a typical amount of gas and electricity.

That could still mean a household which chose an expensive fixed tariff pays more than those on a capped variable tariff - even after the discount.

They do not have an automatic right to cancel that fixed deal without a penalty charge, unless they signed up in the last 14 days.

https://www.bbc.co.uk/news/business-62878614

Chrysalis

robbo990 said:

Seems to imply what was stated on the government website that fixed tariffs will receive the 17p/4.5p even if it doesn't bring them to the cap.

https://www.bbc.co.uk/news/business-62878614

Such a big article and they couldnt put the unit rates in there.  Instead people will look at those headline prices for their property size and think that will be their bill.

robbo990

Chrysalis said:

robbo990 said:

Seems to imply what was stated on the government website that fixed tariffs will receive the 17p/4.5p even if it doesn't bring them to the cap.

https://www.bbc.co.uk/news/business-62878614

Such a big article and they couldnt put the unit rates in there.  Instead people will look at those headline prices for their property size and think that will be their bill.

Sorry was premature in posting and edited my post afterwards

Ballymoney

Chrysalis said:

Such a big article and they couldnt put the unit rates in there.  Instead people will look at those headline prices for their property size and think that will be their bill.

If people STILL don’t understand the meaning of typical household and how the price cap works after the months of discussions and news articles then high energy prices are the least of their worries.