Energy price cap from July 2023 (merged)

RedImp_2

Ok, I know I’m stating the obvious…..
If this is now (or will be) the maximum that can be charged based on wholesale prices then why aren’t the energy companies already reducing prices?  To me shows the market is broken if now they just wait for the regulator to give them the maximum they can charge.

CSI_Yorkshire

Because they're not buying gas and electricity this morning for you to use this afternoon.

The wholesale prices that the cap uses include many that are "for delivery in three months" and similar.  They've already bought what you're using today.

You can't say "you'll be able to buy these things cheaper in the future so you have to sell them to me cheaper now".

Mstty

What we can draw from this is the last 3 months prices mean even an even lower cap come October.

Expect some price cap beating tariffs to be released soon.

peter3hg

Ofgem have produced a good breakdown of the cap here:
https://www.ofgem.gov.uk/publications/customers-pay-less-energy-bills-summer

The graphs below show the relevant wholesale forward prices for the price cap.

The_Green_Hornet

MattMattMattUK said:

The_Green_Hornet said:

MattMattMattUK said:

Chrysalis said:

There seems to be no political appetite for addressing SC sadly.  Unit rates and overall annual typical usage cost is what grabs the headlines.

Why does the Standing Charge to be "addressed"? It is there to cover specific costs, there is a legitimate reason for it to be charged as it is, why should it be "addressed"?

Greg Jackson, CEO and Founder of Octopus Energy says:

“High standing charges are egregious. This £40m package is the beginning of our battle to bring them down. Far too many costs have been loaded onto standing charges - from grid and distribution charges to failed suppliers. These charges just make it more difficult for hard-pressed customers to save money through efficiency and Octopus is making a stand to change that.”

https://octopus.energy/press/octopus-takes-stand-against-standing-charges-with-40m-package/

Marketing statements to the media to appeal to the uneducated public do not constitute a valid analysis of the costs and merits of the billing structure. 

You are absolutely correct. It is much better to listen to the uneducated public posting anonymously on internet forums,

MattMattMattUK

RedImp_2 said:

Ok, I know I’m stating the obvious…..
If this is now (or will be) the maximum that can be charged based on wholesale prices then why aren’t the energy companies already reducing prices?  To me shows the market is broken if now they just wait for the regulator to give them the maximum they can charge.

If you want to pay current market rate there are options, but the SVT is not designed for that. 

https://octopus.energy/smart/tracker/

MattMattMattUK

The_Green_Hornet said:

MattMattMattUK said:

The_Green_Hornet said:

MattMattMattUK said:

Chrysalis said:

There seems to be no political appetite for addressing SC sadly.  Unit rates and overall annual typical usage cost is what grabs the headlines.

Why does the Standing Charge to be "addressed"? It is there to cover specific costs, there is a legitimate reason for it to be charged as it is, why should it be "addressed"?

Greg Jackson, CEO and Founder of Octopus Energy says:

“High standing charges are egregious. This £40m package is the beginning of our battle to bring them down. Far too many costs have been loaded onto standing charges - from grid and distribution charges to failed suppliers. These charges just make it more difficult for hard-pressed customers to save money through efficiency and Octopus is making a stand to change that.”

https://octopus.energy/press/octopus-takes-stand-against-standing-charges-with-40m-package/

Marketing statements to the media to appeal to the uneducated public do not constitute a valid analysis of the costs and merits of the billing structure. 

You are absolutely correct. It is much better to listen to the uneducated public posting anonymously on internet forums,

Or maybe look at the factual analysis published by Ofgem and research bodies. You can tell the post from Jackson is a marketing statement because he does not actually propose how the costs from standing charges should be recovered if they are not on the standing charge, and when pressed in interviews he has declined to answer that part, only that they should be lower. 

MSE_James

You can find MSE's coverage of today's price cap announcement here:

https://www.moneysavingexpert.com/news/2023/05/martin-lewis--the-energy-price-cap-will-fall-in-july--reducing-t/

MSE's price cap calculator has also been updated with the new rates:

https://www.moneysavingexpert.com/utilities/what-are-the-price-cap-unit-rates-/#epgcalculator

Raxiel

MWT said:

Raxiel said:

t0rt0ise said:

For anyone who wants to work out their own area.. https://www.ofgem.gov.uk/sites/default/files/2023-05/Default%20tariff%20cap%20level%20-%201%20July%202023%20-%2030%20September%202023.pdf

Unless I'm reading that wrong, the lowest "Single-Rate Metering Arrangement" cap is the east midlands at £1045.31 for 3100kWh. That works out to 33.7p a unit. A far cry from 30p

What am I missing?

The figures for the 3100kWh usage include the standing charge....

Thanks, I assume they don't include 5% vat?

That puts the east midlands at 29.4p/kWh and 50.3/day for electric and 7.37p/kWh and 29.1/day. About £6 a year less than CI

TheElectricCow

dunstonh said:

Next thing to wait for is the EDF Eastern pricing to see whether they retain the low off peak rate.

I’m very interested in the new rate card from EDF too, I’m not with them at the moment but I’ve been tempted to make a switch. If they do keep up the cheaper than gas night rate by the time we start heading into next winter I might well go for it.