Standing Charge 10% Increase

dealyboy

@The_Green_Hornet provided a link in another thread to an OFGEM explainer ...

https://www.ofgem.gov.uk/information-consumers/energy-advice-households/costs-your-energy-bill

... provides a lot of useful background to OFGEM and suppliers, their duties and responsibilities including the usage of the standing charge.

Scot_39

InvertedVee said:

I'm with Octopus in the Midlands and consume 2000kWh/year. 

The 1 April tariff change amounts to an annual saving of 71p. I'm already thinking about what to spend it on!

The April tariff change is largely transparent to most on SVT SR electric and gas - just as it was in Jan.

If you benefit, it's because your regional rate has shifted lower than the average.  Other regions will then have increased.

Due to the EPG remaining fixed.  There was no reason to expect massive savings or massive rises.

Unlike many saw in Jan on E7 and other legacy multirate (E10, whitemeter, eco20:20 etc ) deals.

Others on multirate are seeing far bigger changes with Apr rates - due to the way some firms implemented discounts and others split the day / night tariffs when Ofgem changed the multirate average prices.

In my region Ofgem multirate went up over 2p, single rate down 0.2p, single rate drove the discount, my prices up 2.2xp / kWh day and night, this time Ofgem both came down, still awaiting new rates from EOn.

ariarnia

Spoonie_Turtle said:

Scot_39 said:

Spoonie_Turtle said:

bristolleedsfan said:

Spoonie_Turtle said:

bristolleedsfan said:

Spoonie_Turtle said:

sevenhills said:

Spoonie_Turtle said:

sevenhills said:

Scot_39 said:

coupleuk said:

Octopus have announced a 10% Price Increase to the Daily Standing Charge (and knocked a whopping 1p off the unit rate).

These Standing Charges are a disgrace - when wholesale rates tumble, the Standing Charge goes up.

How does that help people reduce their electric bill? - where is the incentive?

Forget unit rates, the biggest ripoff in the energy market is the Standing Charge.

Amazed this website does not fight the issue.

Ofgem set the standing charge - not the energy firms - not the government.

That is not what I have read!
The OP has started a thread about Octopus increasing the standing charge by 10%, it's not Ofgem that has announced the increase.
If Ofgem set the level of the standing charge, we would all have messages about it's increase.

No doubt you will, it's still a couple of weeks until April and the price changes.

Ofgem sets a cap on what 0kWh usage would cost, and a cap on what 3,100kWh electricity* and 12,000kWh gas would cost.  (*then converted to 2,900kWh electricity for the cap they communicate to the public for some reason, I don't understand why.)  Those tables, by Ofgem, are here https://www.ofgem.gov.uk/sites/default/files/2023-02/Default tariff cap level - 1 April 2023 - 30 June 2023.pdf

Suppliers are free to set a lower standing charge if they wish (and can afford to subsidise those non-negotiable charges - Octopus actually set it at 4% lower than the cap since October).  Octopus are also a company that have campaigned against the standing charge, so this increase is certainly not an arbitrary decision by them and them alone.

This is from the money saving expert web site - The energy supplier sets the daily rate you pay depending on your location, your chosen tariff and to make the firm profitable.

The energy supplier is regulated by industry body Ofgem, who impose limits on how much can be charged.

They can set higher standing charges for fixed tariffs, but there's no market for that right now and people would almost certainly not choose to pay a higher standing charge than they have to (i.e., higher than the SVT).

They can set lower standing charges for fixed tariffs, but there's no market for that right now due to EPG credit suppliers receive for variable tariffs,

How would that work with the set network costs - recouped by a higher unit rate perhaps?

Yes .......

That's what I thought.  But I can't imagine there's much of a market for people willing to pay higher unit rates than they absolutely need to, right now - and that's even if any supplier could hedge enough for a fix at a low enough rate for people to even consider, as they won't get the EPG.

Of course theres a market.

Theres even one AFAIK firm already selling to it.

…

IIRC with Utilita - thats 2kWh/day - with 1/2 SC added to both those 2 units - so easy to work out.

There may be a tiny market, but the main people who would choose it would be those better off - or I guess people who hate the standing charge and would go with it out of stubborn principle even though it would work out more expensive? 

executors of probate estates can already ask several suppliers for standing charge to be refunded/not charged while the property is empty/sold if no energy is used. so holiday homes empty a few months a year? or those couples who have seporate houses (so a few days at a time where one house would only use background energy?)

for us if we could get a 0 standing charge tarrif just for gas (we had one a few years ago) it would work out because we only use gas really 4 months of the year and even then are low users. but the ones i saw more recently were all duel fuel which would be more expensive for us. (and now of course not really any options)

matt_drummer

Zero standing charge tariffs are just playing with numbers.

The energy supplier still has to pay the network operator for the supply to the customers home.

It's a just a different presentation of the numbers, you are still paying the standing charge, it is just the the energy supplier may be subsidising or profiting from the consumer depending on their usage.

There is no getting away from the fact that there are fixed costs of supplying electricity and gas to our homes, how much we use is irrelevant, the costs are there whatever.

Those costs need to be paid for by all of the consumers.

I just look at my bill as a total, make it as low as I can, how it is made up is out of my control and I don't really care.

If there's a tariff that works for you in being the cheapest available based on your usage then that is what you should choose, however the amount is split between fixed and variable portions.

pochase

Of course it is just playing with numbers if you still have to pay your share of the infrastructurem but that is not what people here want. They want that other people pay their share of the cost for them.

rodmaker

coupleuk said:

Octopus have announced a 10% Price Increase to the Daily Standing Charge (and knocked a whopping 1p off the unit rate).

These Standing Charges are a disgrace - when wholesale rates tumble, the Standing Charge goes up.

How does that help people reduce their electric bill? - where is the incentive?

Forget unit rates, the biggest ripoff in the energy market is the Standing Charge.

Amazed this website does not fight the issue.

You are lucky my standing charge jumped over 24% with Octopus on E7. It was 49p with the government support and now is 60.11!

In actual fact the standing charge hasn't risen all that has happened is that the government support has been removed.

Spoonie_Turtle

rodmaker said:

coupleuk said:

Octopus have announced a 10% Price Increase to the Daily Standing Charge (and knocked a whopping 1p off the unit rate).

These Standing Charges are a disgrace - when wholesale rates tumble, the Standing Charge goes up.

How does that help people reduce their electric bill? - where is the incentive?

Forget unit rates, the biggest ripoff in the energy market is the Standing Charge.

Amazed this website does not fight the issue.

You are lucky my standing charge jumped over 24% with Octopus on E7. It was 49p with the government support and now is 60.11!

In actual fact the standing charge hasn't risen all that has happened is that the government support has been removed.

What government support?  The EPG discount is on unit rates, has been since the start.

70sbudgie

matt_drummer said:

I just look at my bill as a total, make it as low as I can, how it is made up is out of my control and I don't really care.

If there's a tariff that works for you in being the cheapest available based on your usage then that is what you should choose, however the amount is split between fixed and variable portions.

I take a similar approach. I look to minimise my usage, then look for the tariff that minimises my cost based on that usage.

rodmaker

Spoonie_Turtle said:

rodmaker said:

coupleuk said:

Octopus have announced a 10% Price Increase to the Daily Standing Charge (and knocked a whopping 1p off the unit rate).

These Standing Charges are a disgrace - when wholesale rates tumble, the Standing Charge goes up.

How does that help people reduce their electric bill? - where is the incentive?

Forget unit rates, the biggest ripoff in the energy market is the Standing Charge.

Amazed this website does not fight the issue.

You are lucky my standing charge jumped over 24% with Octopus on E7. It was 49p with the government support and now is 60.11!

In actual fact the standing charge hasn't risen all that has happened is that the government support has been removed.

What government support?  The EPG discount is on unit rates, has been since the start.

Thanks for your repIy. Yes that is what I understood. I have just signed up with them this week. It is confusing the way Octopus have laid this out.in the pdf they sent about the new prices.

"New prices without gov. support from 1st April 2023. Standing charge  49.11p 60.11p

Unit rate - day (per kWh)  41.359p 58.757p  Unit rate - night (per kWh)  36.548p 19.150p"

Spoonie_Turtle

rodmaker said:

Spoonie_Turtle said:

rodmaker said:

coupleuk said:

Octopus have announced a 10% Price Increase to the Daily Standing Charge (and knocked a whopping 1p off the unit rate).

These Standing Charges are a disgrace - when wholesale rates tumble, the Standing Charge goes up.

How does that help people reduce their electric bill? - where is the incentive?

Forget unit rates, the biggest ripoff in the energy market is the Standing Charge.

Amazed this website does not fight the issue.

You are lucky my standing charge jumped over 24% with Octopus on E7. It was 49p with the government support and now is 60.11!

In actual fact the standing charge hasn't risen all that has happened is that the government support has been removed.

What government support?  The EPG discount is on unit rates, has been since the start.

Thanks for your repIy. Yes that is what I understood. I have just signed up with them this week. It is confusing the way Octopus have laid this out.in the pdf they sent about the new prices.

"New prices without gov. support from 1st April 2023. Standing charge  49.11p 60.11p

Unit rate - day (per kWh)  41.359p 58.757p  Unit rate - night (per kWh)  36.548p 19.150p"

I see.  Not entirely sure why they've done that but it is in line with what people will see on their bills before the EPG discount.

There's a PDF of the discounted rates here https://octoenergy-production-statics.s3.amazonaws.com/blogs/price-update-april-2023/Flexible_Octopus_rates_April_2023_DD.pdf
And for non-DD here https://octoenergy-production-statics.s3.amazonaws.com/blogs/price-update-april-2023/Flexible_Octopus_rates_April_2023_non-DD.pdf

(I don't know why they've not updated their blog for April prices yet https://octopus.energy/blog/energy-price-cap-oct-2022/ )