Price cap falling - fix or not?

diystarter7

Good evening

When I heard about the reduction in the price cap, I felt that I had second-guessed it to the point.

I've had a little think about getting a fixed rate but I'm pretty confident that prices should reduce after that as well,

Is anyone going for a fix, considering a fix ATM?

Sadly, the headline news re cap reduction is overdue IMO.

Our money being used to support us re the impact of energy prices may be done away with so this reduction is not the good news
that many think it may be

https://www.theguardian.com/money/2023/feb/27/energy-price-cap-uk-ofgem-april

Btw, the risk of us not going fixed in April will mean the risk is still there of massive increases should the war in the Ukraine take a turn for the worse. However, atm, I'm staying on the variable rates.



Thanks

Mstty

Well there are no fixes on the market.

They might return later this year.

diystarter7

Mstty said:

Well there are no fixes on the market.

They might return later this year.

Hi

Thank you. No wonder when having a quick look I could not see any.

With fixes, they are above the going varying rates and I guess most will not bother when they make a comeback as things stand.

I think most people, even those that have money to support their heating needs financially like us, have cut back and are more careful.

The reduction in the price cap is long overdue IMO and unbiased media sources support my stance.

https://www.theguardian.com/money/2023/feb/27/energy-price-cap-uk-ofgem-april

Thanks.

ariarnia

diystarter7 said:

Mstty said:

Well there are no fixes on the market.

They might return later this year.

With fixes, they are above the going varying rates and I guess most will not bother when they make a comeback as things stand.

not always. historically fixes have been below the variable rate and have been the best way to save money (because of hedging). 

Scot_39

Mstty said:

Well there are no fixes on the market.

They might return later this year.

Lets hope if they do this time - the regulator does a better job of insuring the suppliers are robust enough - i.e. fully financially secure - with the necessary backing capital - or secured supply at known costs - for the duration of the fixes.

The SoLR levy has just dropped from £61 to £19 for Apr-Jun £3280.

And despite this - due to other pricing changes - the electric SC has gone up by an average of 7p - from 46p to 53p.

See price breakdown at

https://www.ofgem.gov.uk/publications/ofgem-announces-latest-quarterly-price-cap-update

We don't need it coming back.

Mstty

Scot_39 said:

Mstty said:

Well there are no fixes on the market.

They might return later this year.

Lets hope if they do this time - the regulator does a better job of insuring the suppliers are robust enough - i.e. fully financially secure - with the necessary backing capital - or secured supply at known costs - for the duration of the fixes.

The SoLR levy has just dropped from £61 to £19 for Apr-Jun £3280.

And despite this - due to other pricing changes - the electric SC has gone up by an average of 7p - from 46p to 53p.

See price breakdown at

https://www.ofgem.gov.uk/publications/ofgem-announces-latest-quarterly-price-cap-update

We don't need it coming back.

Thanks for giving me a link I posted myself on Monday morning in the energy news in general.thread.

Having been around here for SOLR and the chaos and aftermath I'm fully up to speed and aware of the measures put in place to stop that happening again and recently made aware of other measures and payments in place when suppliers.lose.a customer and the reparation paid by the new supplier. These measures suggest the fly by night companies can't make a return as they would not have the upfront cash to offer a massively undercut fix and pay the reparation to the "stolen" customer for want of a better phrase.

Fixes will return from the tradition suppliers and time of use have already appeared from the forward thinking supplier in the market. A return to a bit of regulated competition will be welcomed by us.

I do though have sympathy for low and financially constrained users with dual fuel paying circa £300 a year standing charges.

macman

The supply of Russian gas has slowed to a trickle in Europe, and they are busy making plans to sell it to more receptive buyers: primarily China. Even if peace were to break out and Russia were willing and able to resume bulk supply to Europe, then there would be no takers, because we (primarily Germany and Italy) now realise that we cannot be dependent on such an easily disrupted source of supply. Until Putin departs the scene, be it by natural or unnatural means, that is not going to change, because there will be no trust.
So I do not see wholesale prices returning to their peak '22 levels, but rather continuing to fall slowly as more LPG capacity becomes available in Europe, and more renewables come on stream.
Fixing is not about securing the best rate: what you are paying for is an insurance policy against the worst case, which is a further rise.

diystarter7

macman said:

The supply of Russian gas has slowed to a trickle in Europe, and they are busy making plans to sell it to more receptive buyers: primarily China. Even if peace were to break out and Russia were willing and able to resume bulk supply to Europe, then there would be no takers, because we (primarily Germany and Italy) now realise that we cannot be dependent on such an easily disrupted source of supply. Until Putin departs the scene, be it by natural or unnatural means, that is not going to change, because there will be no trust.
So I do not see wholesale prices returning to their peak '22 levels, but rather continuing to fall slowly as more LPG capacity becomes available in Europe, and more renewables come on stream.
Fixing is not about securing the best rate: what you are paying for is an insurance policy against the worst case, which is a further rise.

Hello

Many thanks for sharing your views.

Yes, true about fixing as per your post and this applies to mortgages for those that have them.

Thanks

superkoopauk

Scot_39 said

Lets hope if they do this time - the regulator does a better job of insuring the suppliers are robust enough - i.e. fully financially secure - with the necessary backing capital - or secured supply at known costs - for the duration of the fixes.

The Market Stabilisation Charge should help with this although it also discourages suppliers launching new fixes so a double edged sword.

diystarter7

Hiya

Just been reading this

Very easy to follow, especially the bits about rates per unit pre October, current, etc and IMO, helps one form a judgement if and when to go for a fix.

https://www.moneysavingexpert.com/utilities/energy-price-guarantee/

3. The Price Cap is still a cap on standing charges and unit rates

Here are the average dual-fuel direct debit rates for the Energy Price Guarantee from 1 October, how it compares to the previous rates, and what was due to happen under the old Price Cap. The current rates include the announced ending of green levies on energy bills.

• Electricity:
  Unit rate: 34.0p/kWh (was 28.3p before 1 Oct; was due to be 51.89p)
  Standing charge: 46.4p/day (was 45.3p before 1 Oct; was due to be 46.4p)
  
  
• Gas: 
  Unit rate: 10.3p/kWh (was 7.4p before 1 Oct; was due to be 14.76p)
  Standing charge: 28.5p/day (was 27.2p before 1 Oct; was due to be 28.5p)

The cap varies by region and how you pay, so for full info see our guide to Ene

Thnaks

Scot_39

Mstty said:

Thanks for giving me a link I posted myself on Monday morning in the energy news in general.thread.

Sorry - included the link only to back up figures for SoLR and the 53p.