Energy Price Guarantee (announced 8 Sep): initial reaction & questions

danmed

I may be chiming in here at the wrong time.. and tell me if i am .. but i'm on economy 7 because my house has an immersion water heater and it kicks in on a seperate circuit which is activated by the energy company / smart meter during the 7 hour period over night... 

I'm assuming that i will be paying over the 34p during the day and under the during the night.. but averaging out at 34p (ish) over a 24 hour period.. I am a little confused why this hasn't been confirmed yet.. but i guess it's because in theory an energy company could decide to massively offset the night vs day rate (make day rate like 48p and night rate 1p (if my excel skills havn't failed me.. that would be about right with a 17 / 7 split) to try and make the most out of the current situation? 

[Deleted User]

danmed said:

I may be chiming in here at the wrong time.. and tell me if i am .. but i'm on economy 7 because my house has an immersion water heater and it kicks in on a seperate circuit which is activated by the energy company / smart meter during the 7 hour period over night... 

I'm assuming that i will be paying over the 34p during the day and under the during the night.. but averaging out at 34p (ish) over a 24 hour period.. I am a little confused why this hasn't been confirmed yet.. but i guess it's because in theory an energy company could decide to massively offset the night vs day rate (make day rate like 48p and night rate 1p (if my excel skills havn't failed me.. that would be about right with a 17 / 7 split) to try and make the most out of the current situation? 

https://forums.moneysavingexpert.com/discussion/6387150/big-changes-for-e7-as-part-of-epg

Not quite - 34p has nothing to do with E7.  Energy suppliers have always had free choice about the balance between day/night rates on their tariffs, as long as they are under the cap value (in £££) for someone using 58% day and 42% night.  We've had to back-calculate this cap, because nobody seems to have announced it yet, but it looks to be about £1440 for 4200kWh of electricity.

mrsmac59

danmed said:

I may be chiming in here at the wrong time.. and tell me if i am .. but i'm on economy 7 because my house has an immersion water heater and it kicks in on a seperate circuit which is activated by the energy company / smart meter during the 7 hour period over night... 

I'm assuming that i will be paying over the 34p during the day and under the during the night.. but averaging out at 34p (ish) over a 24 hour period.. I am a little confused why this hasn't been confirmed yet.. but i guess it's because in theory an energy company could decide to massively offset the night vs day rate (make day rate like 48p and night rate 1p (if my excel skills havn't failed me.. that would be about right with a 17 / 7 split) to try and make the most out of the current situation? 

Can I ask how  you got on E7 ,as I have emmersions too, andI only have the one unit rate for 24hrs? 

SJMALBA

Despite no change in the update date, the official EPG factsheet has received a rather significant update:

If you’re on a fixed rate tariff

For those customers on fixed rate tariffs, a ‘floor’ unit price for gas averaging at 10.3p/kWh and for electricity averaging at 34p/kWh for direct debit customers will also come into effect on 1 October 2022. We are introducing a floor because some people will have fixed at much lower prices some time ago, meaning their annual payments will already be below the £2,500 average set by the Energy Price Guarantee.

Unit price reductions of up to 17p/kWh for electricity and 4.2p/kWh for gas will apply to fixed tariff customers to bring their rates down to, but not below, the floor unit price. Customers on fixed rate tariffs that are already below the floor unit prices will continue to enjoy those low rates, but will not receive a further discount for the duration of their fixed term.

For the small number of consumers who fixed at a high rate exceeding the October Ofgem price cap of £3,549, they will receive the full discount of 17p for electricity and 4.2p for gas. However, given the higher starting point, their fixed rate tariff will still have a unit rate that is above the EPG rates. This will ensure that a fair price is paid by everyone.

Energy suppliers will adjust fixed tariffs automatically. Customers on fixed tariffs do not need to take any action to get the benefits of this scheme. Any transfer to a different tariff is a matter for suppliers.

https://www.gov.uk/government/publications/energy-bills-support/energy-bills-support-factsheet-8-september-2022

1505grandad

"An additional discretionary fund will be available for those households who are outside of the schemes. For example, households not on standard gas / electricity contracts."

"If you’re not connected to the grid

Those households not on standard gas or electricity contracts, such as those living in park homes or on heat networks – and so outside the scheme – will be no worse off and will receive comparable support through a discretionary fund."

Has the wording been amended  -  do households who are contracted/connected/pay for electric but have to heat water/home by oil (which for some costs more than the electric bill) not now qualify for the DF?

SJMALBA

Make of this what you will...

alibean121

Does anyone have any information on fixes where unit rate is below the cap rate but standing charge is above. Will the standing charge be discounted?

GingerTim

alibean121 said:

Does anyone have any information on fixes where unit rate is below the cap rate but standing charge is above. Will the standing charge be discounted?

The standing charge will almost certainly remain the same in these instances.

superkoopauk

SJMALBA said:

Despite no change in the update date, the official EPG factsheet has received a rather significant update:

If you’re on a fixed rate tariff

For those customers on fixed rate tariffs, a ‘floor’ unit price for gas averaging at 10.3p/kWh and for electricity averaging at 34p/kWh for direct debit customers will also come into effect on 1 October 2022. We are introducing a floor because some people will have fixed at much lower prices some time ago, meaning their annual payments will already be below the £2,500 average set by the Energy Price Guarantee.

Unit price reductions of up to 17p/kWh for electricity and 4.2p/kWh for gas will apply to fixed tariff customers to bring their rates down to, but not below, the floor unit price. Customers on fixed rate tariffs that are already below the floor unit prices will continue to enjoy those low rates, but will not receive a further discount for the duration of their fixed term.

For the small number of consumers who fixed at a high rate exceeding the October Ofgem price cap of £3,549, they will receive the full discount of 17p for electricity and 4.2p for gas. However, given the higher starting point, their fixed rate tariff will still have a unit rate that is above the EPG rates. This will ensure that a fair price is paid by everyone.

Energy suppliers will adjust fixed tariffs automatically. Customers on fixed tariffs do not need to take any action to get the benefits of this scheme. Any transfer to a different tariff is a matter for suppliers.

https://www.gov.uk/government/publications/energy-bills-support/energy-bills-support-factsheet-8-september-2022

Great spot thanks.  Good to have clarity on this at last.

John_Philip_Howarth

alibean121 said:

Does anyone have any information on fixes where unit rate is below the cap rate but standing charge is above. Will the standing charge be discounted?

I think you will have to wait until your supplier come up with your actual unit rates. There are a number of questions e,g. my fixed  unit price for gas is below the EPG but above for electric , similarly with the standing charge.  So , how they work out the actual charge will be very interesting