Economy 7 Price hike

pochase

The doucument you are quoting talks about Ofgem giving 25 working days / 35 days notice before the new cap kicks in. They are saying that this will give both consumers and suppliers enough notice to prepare for the change, suppliers to calculate the new rates and consumers to make decisions regarding the price change.

4.18. To note, the number of working days is fewer than the number of calendar days. This means that after we announce the cap, 25 working days in advance of the cap level taking effect, consumers will have over a month’s notice for foresight and response (eg we will announce the October cap in late-August). Additionally, we are considering whether we can provide forecasts of the cap on a regular basis to keep stakeholders and customers informed of the direction of upcoming cap updates. However, to note, a forecast would be inherently uncertain and would only show the average effect rather than be specific to a particular customer.

The above clearly states that the Ofgem announcement will give the consumers enough notice to respond, there is nothing at all mentioned when a supplier now has to have the rates ready and needs to inform the customers.

It might be an oversight regarding E7 tariffs, which are the only ones that could trigger a reaction only after the customer sees the new rates, but if so it is a Ofgem oversight.

Also with the new 5 days switching time E7 information 5 days before the new price kicks in would be sufficient, and the new E7 rates for most suppliers were available last week.

Nath4n

All fair points regarding switching times, and the 20 working day grace period on price changes to switch away, they're all fair and progressive supplier terms that will hopefully minimise any undue impact on vulnerable customers. But yes, apologies if I didn't emphasise the E7 aspect more, I fully agree - unlike almost everything else related to the price cap, there does seem to be a fair amount of 'discretion' that individual providers are now using every 3 months in terms of recalculating their 'balance' of peak/off-peak/service charge for Economy 7 users that OFGEM has not perhaps forseen. This is only made public once customer price change notifications go out. This resulted in some (sometimes uninformed) large-scale media coverage in December/January and I'd be surprised not to see any more over the coming weeks.

I do not consider myself a vulnerable customer, however my personal notification by UW on Monday indicates a 21% increase in costs from 1st April at existing usage (seasonable variations unfortunately do not apply as it is a small flat and the vast majority of the costs are general electricity usage + hot water costs rather than heating). Before the argument is made, in full comprehensive that UW has refined their 'balance' which is likely going to result in savings for greater % 'peak' users, and in full comprehension that I (and any other customer) can switch away at no cost, 4 working days notice of a 21% increase in energy costs in the current environment feels unacceptable.

Birmanmum

I have just received the new energy prices from my supplier [EDF] which are due to come into play tomorrow, 1st April and am absolutely horrified to see that the night rate increase is OVER 100%.

 The night rate as of today is 6.9p pkWh but tomorrow rises to 14.55p pkWh, an increase of 7.62pence.  This is horrendous!

Is this happening with all suppliers across the board?  Is it acceptable?  Is it a mistake/typo or are the suppliers allowed to do this?

 

pochase

Yes suppliers are allowed to do this. You forgot to mention that the day rate has been reduced at the same time.

No, most suppliers don't have that big an increase because they were already at a similar high rate like the one are paying in future for the last 6 months.

The average E7 day/night rate needs to be equal or smaller than the single rate for electrcity. The average rate is based on a use of 4200KWh with a 42%/58% day/night split.

As long as the supplier follows above rules they can set day and night rates however they want. It can be a very low night rate and high day rate as you had now. Or a medium night rate and a lower day rate like you will have in future, the day and night rate can even be almost the same with little difference between them.

TheElectricCow

Birmanmum said:

I have just received the new energy prices from my supplier [EDF] which are due to come into play tomorrow, 1st April and am absolutely horrified to see that the night rate increase is OVER 100%.

 The night rate as of today is 6.9p pkWh but tomorrow rises to 14.55p pkWh, an increase of 7.62pence.  This is horrendous!

Is this happening with all suppliers across the board?  Is it acceptable?  Is it a mistake/typo or are the suppliers allowed to do this?

 

While as a percentage increase that may seem like a lot, it’s important to keep some perspective on things. 14.55p is still a very low night rate compared to most out there at the moment and the only reason you’re seeing such a large increase is because 6.9p was incredibly cheap compared to what most others have been paying.

Also worth bearing in mind that for a single rate tariff you’d be paying around 33p/kWh so that’s something to consider if you’re feeling like the dual rate is no longer working out.

Try to think of it as you’ve just had at least three months of very good prices and your rates are now returning to the “normal” amount, rather than looking at the increase and feeling like it’s the worst thing ever.

Yes, all suppliers have adjusted their E7 rates one way or the other, some to a greater or lesser extent than others - it might be worth shopping around to see if any will fit your usage better but I don’t think you’re likely to find lower night rates than EDF’s at the moment without one of Octopus’ specialised tariffs.

Your day rate will have also gone down at the same time as the night rate going up, so yes they are allowed to do it.

Swipe

Apart from the people in the EDF Eastern region who are still quids in when it comes to the night rate

dealyboy

Swipe said:

Apart from the people in the EDF Eastern region who are still quids in when it comes to the night rate

... not for much longer I fear ... https://forums.moneysavingexpert.com/discussion/6436562/mse-news-government-changes-how-the-energy-price-guarantee-should-be-applied-to-economy-7-tariffs/p1

Scot_39

Birmanmum said:

I have just received the new energy prices from my supplier [EDF] which are due to come into play tomorrow, 1st April and am absolutely horrified to see that the night rate increase is OVER 100%.

 The night rate as of today is 6.9p pkWh but tomorrow rises to 14.55p pkWh, an increase of 7.62pence.  This is horrendous!

Is this happening with all suppliers across the board?  Is it acceptable?  Is it a mistake/typo or are the suppliers allowed to do this?

 

And the day rate ?

You do realise they both changed.

And you are far more likely to be using a lower balance of night and day - if for instance you are on E7 for the sake of night storage heating.

If a high winter off-peak user - these very cheap - last quarter only ? - rates - actually helped save people like you maybe £100s of pounds - compared to rates paid in same region and others by many others.

Some regular MSErs actually switched to EDF in the cheaper regions in Jan - and not before - because their sub 10p rates were so cheap compared to the compitition.

For others on E7 - on average it saw an increase of 7.6% across 2.5m homes - other users posting here saw 15-18% increase - to around 17-18p per unit - with suppliers like EOn in midlands - as highlighted by MSL article examples.

So your rate is in some ways normalising - and the Jan-Mar rates - the anamoly - which as I say you have benefitted from.

And if your night use does drop due to no longer using for heating - the new lower day rate - may even be a better deal for the coming quarter - than staying on the old higher day / lower night rates.

But rather than look at the overall picture - and thinking about the arguably unfair advantages over 100,000s of others - you have probably gained from - and doing a proper cost of use now analysis - you focus on one part of the cost - and choose to complain when they end.

Swipe

dealyboy said:

Swipe said:

Apart from the people in the EDF Eastern region who are still quids in when it comes to the night rate

... not for much longer I fear ... https://forums.moneysavingexpert.com/discussion/6436562/mse-news-government-changes-how-the-energy-price-guarantee-should-be-applied-to-economy-7-tariffs/p1

Well they were lucky enough to still get it from 1st April at least. Now, I just wish I was in the Eastern region.

dealyboy

@Swipe ...

Swipe said:

dealyboy said:

Swipe said:

Apart from the people in the EDF Eastern region who are still quids in when it comes to the night rate

... not for much longer I fear ... https://forums.moneysavingexpert.com/discussion/6436562/mse-news-government-changes-how-the-energy-price-guarantee-should-be-applied-to-economy-7-tariffs/p1

Well they were lucky enough to still get it from 1st April at least. Now, I just wish I was in the Eastern region.

22.7% increase in night rate

 ... those day/night rates have narrowed from the 1st January rates day (correction) 54.47p night 7.00p, presumably due to the 'Martin E7 EPG equalisation', equivalent to 32.95p single rate at usage of 58% day, 42% night, about 1p less than the the OFGEM/EPG SVT.

E7 users with a proportion higher than 42% night will pay more, all things being equal, but of course they're not, night rate absolute usage and in percentage terms will likely both come down April - June for many who will benefit, (edited) but if their percentage dips below 42% people may be better on the SVT; and from July it's all to play for.