MSE News: More energy deals with NO standing charges finally on the cards

Qyburn

Patr100 said:

If they embed/hide what was previously the SC in the first 2 units - this is  likely to be a pointless shift for most very low users
eg myself on average 3.5 to 4 Kwh daily use.

It would be a cracking Summer deal for those with solar.

badmemory

Only if it came with a decent export tariff, which is unlikely.

wrf12345

Have been tempted by Utilia a couple of times but the gas rates are three to four times what you would normally pay (for the first 2kw a day) and that makes it a no-no even though I only use gas three months a year, not really worth changing to a company with little positive reviews to save a small amount of money but if Octopus offer similar might have a go even though it is not the way to do zero s/c tariffs.

Scot_39

Patr100 said:

If they embed/hide what was previously the SC in the first 2 units - this is  likely to be a pointless shift for most very low users
eg myself on average 3.5 to 4 Kwh daily use.

Welcome to the economic reality.

If you don't pay towards the supliers and their suppliers costs like the grid costs - some one else has to.

The zero standing charge concept - a truly ill thought out solution to a real problem. 

The total cost of energy and how we help our poorest to afford it.

And as only becoming clear to many  - as it was in past presented openly and honestly by many ridiculed green politicians who have talked openly about the transition costs and taxation needed to subsidise it (as opposed to those in actual power with their many jam tomorrow promises of future savings )  - in particular right now and going forward in medium term how we compensate them to afford the now clear and still  growing costs of the net zero green transition.

Wind and sunlight may be free energy - the cost of capturing it and delivering it to our doors in ever increasing quantities is not. (With £10bn plus pa forecast spend on grid capacity e.g.  £58bn in ESO's "Beyond 2030" forecast - for next 5 yrs to 2035) 

And made worse by the contract terms - like curtailment payments - hitting £1bn this year and just one component - grid thermal - forecast to hit £3bn by 2030. 



Anyway getting back to your I will not save 

The 2kWh per day at Utilita - around 730 kWh per annum if consume every day.

Few occupied homes in reality will I suspect use less - even many medium to large homes with solar will perhaps use that over 3-5m in winter.

In fact other than say very temporary use second homes - of the in many cases already very wealthy - who can well afford to pay £330 in standing charges  - suspect few in reality would / could benefit.  But I am sure thosevcould save save ones may already have switched to utilita when can anyway.

Ofgem tables in last report already show the clear losers over simplistic SC to unit rate shifts.

Increase the thresholds above utilita levels - to "help" folk like you -  well lets take one possibility - as Ofgem produce 3 tdcvs by data quartiles iirc.

It would be arguably ludicrous to use median - for dual fuel - (but maybe a lot less so for pc2 meters and those with conventional electric heating - the big losers in tge interim documents)  - the 2700kWh / 115000 kWh gas.

But that would leave 50% of homes under paying on a cap compliant tariff model - with a mechanism tgen needed if realky wanted to avoid them being subsidised by the other 50%. 

You've guessed it - without external direct govrpt funding a la epg for prepay - a higher overall cap level.  And given that has gone and instead the rest of us now pay - via the levilisation charge - that seems unlikely.


The low (iirc 1st quartile) tdcv for electric is 1800kWh (gas iirc 7500kWh  - over 10x tge utilta threshold) under c5kWh per day.

That would then probably allow those with solar to save significant component of fixed cost share - and IMO those who can afford £1000s for solar and battery - are generally not those genuinely in need of our via bIll cross subsidy or govt taxation. 
And of course in any case should still pay the full SC or its equivalent if looking to import or export the 5kWh per day or 1800 kWh pa threshold in total or any other chosen threshold

So you would if the whole regional ave c £220 cap was recovered at that c5kWh per day on a cap compliant tariff - save just on ave c1.25/5x£220 = £55. £1  per week.

And that tdcv - if used as a compliant cap threshold - is at a level where still 25% of homes in the filtered tdcv data set would therefore like you not then be paying their actual share - as calculated by Ofgem - of fixed costs.

Leaving the other 75% homes cross subsidising you by potentially higher core cap set rates. 

And it's pretty obvious that no one above the breakeven on a higher unit rate on a non cap compliant tariff would sign up for it to pay the higher rate to compensate for you.  So would seem commercially silly to expect suppliers to offer zero SC at the same cap compliant basis and so costing level.

So either Ofgem would have to produce a second higher non SC cap guideline to allow recovery- hence eliminating any saving for some below the notional threshold. Possibly based on the average shortfall from their data spread used for tdcvs.

Which would only make it even less appealing.

Regardless of income, and regardless often of ability to afford their own bills, let alone change their heating - like millions in poorly insulated rental properties - many still with expensive conventional electric hesting - the bill cross subsidy method is inherently flawed - even worse if zero SC tariffs come in.

However such simplistic analysis hides the existing margins and allowances - policy costs etc - that already benefit the poorest - and the resultant costs of not helping them enough ( via cross subsidy or benefits) like the again theoretically temporary £28 allowance for bad debt special  (it was meant to be temporary at £11 when introduced 3 yrs ago iirc as a Covid hardship special) . 
Which in tself could have paid half your potential £55 saving example - perhaps combined with other redistribution - saving the debt build up occurring for some.

Sometimes yhe cost of inactio  is worse than proactive intervention - the stitch in time saves nine approach if you like..

The only way to support the genuine poor is either to reduce energy costs - fear in particulr network costs unlikely to do anything but rise in short term under Milibands planned acceleration of (or any other wind solar renewables led) energy policy  - or increase incomes - to compensate the poor directly for it via benefits (*) , or tax and min wage policy.

(*) And as per tge wfp / pension credit hard cut off -  the benefits route when implemented so carelessly - is fraught with difficulty - hard cut offs and so big winners (qualify and pc can boost finances by dwp own figures c£3.5-4k pa net benefit) and the then clear losers left to struggle without any such help. 

Ildhund

Scot_39 said:
(*) And as per tge wfp / pension credit hard cut off -  the benefits route when implemented so carelessly - is fraught with difficulty - hard cut offs and so big winners (qualify and pc can boost finances by dwp own figures c£3.5-4k pa net benefit) and the then clear losers left to struggle without any such help. 

I'm afraid that I don't have much sympathy with those who need government help to be able to cope, but only accept what they don't have to apply for. I'm not sure where the "c£3.5-4k" figure comes from, but it may be the difference between a state pension sum and the minimum income government decides everyone should have. That is the Pension Credit level - if your income is lower, you're entitled to the difference.

The 'clear losers' you refer to are those whose income is higher than the PC level. There are a few - e.g. those on the full new state pension - who will lose out as a result of means-testing the WFP. What they will lose amounts to 79p/week, which shouldn't cause anyone to struggle who wasn't struggling before. 

badmemory

It isn't hard to have an income higher than pension credit level.  Perhaps you think that all pensioner that aren't on under £12k a year suddenly have £30k a year.  Anyone who budgets has had that £200 in their budget for months as due in december.  Why is it that the only payment that got cancelled immediately, as opposed to in the next tax year, was the winter fuel payment.  There is only one answer & frankly it is not a nice one.  But I guess MPs wil be happy with their c£4k heating allowance.  We couldn't possibly deprive them of that much as I think we should.

Scot_39

Ildhund said:

Scot_39 said:
(*) And as per tge wfp / pension credit hard cut off -  the benefits route when implemented so carelessly - is fraught with difficulty - hard cut offs and so big winners (qualify and pc can boost finances by dwp own figures c£3.5-4k pa net benefit) and the then clear losers left to struggle without any such help. 

I'm afraid that I don't have much sympathy with those who need government help to be able to cope, but only accept what they don't have to apply for. I'm not sure where the "c£3.5-4k" figure comes from, but it may be the difference between a state pension sum and the minimum income government decides everyone should have. That is the Pension Credit level - if your income is lower, you're entitled to the difference.

The 'clear losers' you refer to are those whose income is higher than the PC level. There are a few - e.g. those on the full new state pension - who will lose out as a result of means-testing the WFP. What they will lose amounts to 79p/week, which shouldn't cause anyone to struggle who wasn't struggling before. 

Drifting off topic

But as someone who has in past had to fill in the forms for parent - I can assure you - many elderly would simply give up.  

Just as other forms - like help with dental or opticians fees etc - they are designed by a system to suit the system - not the ease of use by those seeking help.

As the BBC article below echoes just that very point

"The high number of rejections could be people failing to meet the criteria, or failing to submit the 24-page, 223-question form properly"

https://www.bbc.co.uk/news/articles/ce31dve2je7o

It uses £3900 - not clear if just the basic income uplift - as have seen lower figures for that in the past and slightly higher figures in past.

"The government says it is worth an average of £3,900 a year and claiming it can qualify people for other financial support such as winter fuel payments."

As of end of Nov - that article say only c42500 of the c150,000 applying - have been approved (and an unspecified 1000s been rejected ) - neither figure making a significant inroad into the 880,000 total estimated due the benefit - and so £200 upto £300 WFP on top of it.

So as of that update - thats still nearly 840,000 elderly DWP estimate entitled to PC - still not getting it - or the WFP on top of it - with only 3 weeks to go to this winter's nominal cut off date on 21 Dec next week.

So thats at least £4 or £6 per week - and yes that is enough in itself to make a difference between eat and heat - you could say have 4 tins of soup and a loaf of bread - to eat for 2-4 days out of that sort of figure.

When the DWP first announced the 880,000 figure post the WFP cut announcments this summer - they also estimated 700,000 of them would never claim.  Thats 700,000 permanently not getting the pension credit boost - and all losing the WFP.  (Until hopefully the Govan Law Centre backed court case)

Qyburn

Scot_39 said:

Patr100 said:

If they embed/hide what was previously the SC in the first 2 units - this is  likely to be a pointless shift for most very low users
eg myself on average 3.5 to 4 Kwh daily use.

That would then probably allow those with solar to save significant component of fixed cost share - and IMO those who can afford £1000s for solar and battery - are generally not those genuinely in need of our via bIll cross subsidy or govt taxation.  

There could be a separate and additional standing charge for export, levied if you have an export MPAN. I'd levy it on anyone receiving FIT or deemed export payments as well, but I expect there'd be claims that this was breaking the promises given with FIT.

born_again

Have to laugh at the media & how they get things so wrong..

https://www.express.co.uk/finance/personalfinance/1989225/octopus-energy-676-daily-charge-ditched

But under the new plans, suppliers must offer zero standing charge tariffs to households. It means that Octopus Energy customers on a two-year fix would make a saving of £676 if the charges were scrapped today.

As people will stop reading at that point, & think this is gospel & start moaning when they do not get the savings quoted🤷‍♀️🤣

booneruk

born_again said:

https://www.express.co.uk/finance/personalfinance/1989225/octopus-energy-676-daily-charge-ditched

An absolutely hideous article. I dismay at how poor journalism can be

"Octopus Energy customers given £676" - an absolute
 "Energy customers on a two-year fix would make a saving of £676 IF the charges were scrapped today." -  an IF

Also just as dim, how can anyone think "energy suppliers must offer zero standing charge tariffs" means a free lunch where there's suddenly zero SC along with no increase in unit price.

SMH