The price cap and a newly introduced standing charge.

[Deleted User]

People don’t like standing charges but the answer isn’t as simple as some people believe. Zero standing charge tariffs such as those offered by Ebico were not only attractive to low energy Grid users but also those who, for example,  have PV solar. Having thousands of customers who are paying you nothing isn’t a particularly robust business model.

whattochoose

molerat said:

What is your annual consumption ? If you use in excess of 2900 kWh per year you will be better off on this tariff

OTM estimate I'll use 1042 kWh in the next 12 months.

MWT

whattochoose said:

molerat said:

What is your annual consumption ? If you use in excess of 2900 kWh per year you will be better off on this tariff

OTM estimate I'll use 1042 kWh in the next 12 months.

If their estimate is accurate, then you were benefiting from their non-compliant tariff, but they didn't have a choice to remain non-compliant under the new scheme, fortunately for those using over 2,900kWh, but unfortunately for you it seems..

whattochoose

From the many informed and knowledgeable comments about this, I see I will have to accept if I intend staying with OTM, on the same tariff.
However, I know I'm not alone in being taken a little aback by this development. 
I simply thought I would stay on a nil standing charge, but my unit rate and annual charges would change(increase), in a way that "dovetails" with the strictures of the new Ofgem price cap. Oh well.
I suspect that OTM will be getting quite a few enquiries about this.

[Deleted User]

whattochoose said:

From the many informed and knowledgeable comments about this, I see I will have to accept if I intend staying with OTM, on the same tariff.
However, I know I'm not alone in being taken a little aback by this development. 
I simply thought I would stay on a nil standing charge, but my unit rate and annual charges would change(increase), in a way that "dovetails" with the strictures of the new Ofgem price cap. Oh well.
I suspect that OTM will be getting quite a few enquiries about this.

I can certainly see why you would have thought that - and I agree that there will probably be many people who thought the same as you.

whattochoose

I emailed OTM about the s/c and got the following reply....

"The biggest driver for the increase in the Electricity Standing Charge is due to an increase in the Supplier of Last Resort Levy.

During the last few months, many energy suppliers went out of business. To avoid being left with no energy, their customers had to be taken on by other suppliers which were appointed by Ofgem under the ‘Supplier of Last Resort’ (SoLR) process.

Ofgem has allowed these energy suppliers to claim back the additional costs they incurred when taking on these customers amounting to £1.8bn.

The energy price freeze only applies to Unit rates not the standing charges, therefore as per Ofgem guidance all electricity only customer will be charge a standing charge."

[Deleted User]

whattochoose said:

therefore as per Ofgem guidance all electricity only customer will be charge a standing charge."

That's the bit that I think matters - someone has had a word and pointed out that their old tariff was breaching the cap rules.

Nothing to do with SOLR because that happened in April.