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

Patr100

GingerTim said:

Who will be the first provider to offer a zero standing charge/£1 per kwh tariff?

Low user here. If I calculate right that would make my average monthly bill £116 from currently around £40.

GingerTim

Patr100 said:

GingerTim said:

Who will be the first provider to offer a zero standing charge/£1 per kwh tariff?

Low user here. If I calculate right that would make my average monthly bill £116 from currently around £40.

That's a fear I have, despite my somewhat flippant post. I worry that a good chunk of people will sign up to a zero standing charge tariff only to find their bill actually increase because they don't do the sums that you have.

MattMattMattUK

GingerTim said:

Patr100 said:

GingerTim said:

Who will be the first provider to offer a zero standing charge/£1 per kwh tariff?

Low user here. If I calculate right that would make my average monthly bill £116 from currently around £40.

That's a fear I have, despite my somewhat flippant post. I worry that a good chunk of people will sign up to a zero standing charge tariff only to find their bill actually increase because they don't do the sums that you have.

I am fine with that, if they make an active choice to switch and it ends up costing them then I do not really care. What I do take issue with was Martin's post earlier today on Instagram that it should be the default tariff people are moved to if they do not actively engage. 

MattMattMattUK

Scot_39 said:

But the time for the carrot - like the temporary ASHP grants - the take up of which has been underwhelming according to some reports - is now passing - just as many of the grants and some of the tax breaks for EV drivers are now gone or going - and if govts are serious about net zero - the sticks will clearly be required.

Increase fuel duty by 10p a litre this year and 10p a litre every year after and add 10% duty to all ICE vehicles, use that money to fund expanding the charging network at those figures it would raise £4.6 billion in the first year and with expected behavioural changes probably £9 billion in year two, £12 billion in year three etc. Public charging on lamp posts, roll it out to car parks etc. EVs are already cheaper to run than ICE vehicles, but there can be issues for some with charging, so use the revenue to fund that expansion. 

Implement a 20% tax on gas usage, increase that 20% per year for the four years after until it reaches 100%, use that revenue to subsidise heat pump installations and insulation. 

mmmmikey

GingerTim said:

Patr100 said:

GingerTim said:

Who will be the first provider to offer a zero standing charge/£1 per kwh tariff?

Low user here. If I calculate right that would make my average monthly bill £116 from currently around £40.

That's a fear I have, despite my somewhat flippant post. I worry that a good chunk of people will sign up to a zero standing charge tariff only to find their bill actually increase because they don't do the sums that you have.

Yes, this has got "train crash" and "unintended consequences" written all over it.

One of the main objectives of the price cap was to provide a reasonable safety net for those who haven't engaged with the market and never changed suppliers, who can't (for example because of debt) or don't have the numeracy skills to properly care (which includes people from all walks of life, there are lots of people who simply can't add up). This proposal is going to put the onus of responsibility back on those people to make a choice with all the potential for tears and tantrums that will lead to. Won't be long before we see stories of vulnerable pensioners and the like who are paying over the odds because of all the hype around zero standing charge tariffs.

And what about the folk who have big bills because they are elderly or sick and at home all day, or hard working families living in poor quality rented accommodation? A lot of these people will be struggling because they have high bills with limited scope for cutting back. These high users will have  to pay even more: for every low user that benefits a high user will lose. I feel genuinely sorry for these people.

This is not going to end well, let's hope that common sense prevails and these proposals are never adopted.

This has become a crusade with low standing charges having become an end in itself. It's not going to do anything to resolve the problem of high energy costs. It will simply move the problem from one group of vulnerable people to another, whilst at the same time benefitting second home owners and those affluent enough to own their own homes and invest in good insulation and energy saving technology.

Frankly, I think Martin Lewis has completely lost the plot on this one. It's a crying shame that he chose to use his obvious talents to work against Citizens Advice rather than work with them to address the real issue of high energy costs. This proposal does nothing to address that issue but simply moves the problem to a vulnerable group ill equipped to cope. A sign of the times, I'm afraid, with politicians and lobbyists bowing to popular opinion rather than risking personal popularity by delivering a better informed but uncomfortable truth.

Scot_39

Martin Lewis sadly jumps on far too many populist bandwagons these days to carry the respect he once did - if he did.

Sadly we seem to be in a period where the law of unintended consequences is now forgotten or I suspect simply ignored.

Ofgem might have been pleased or even surprised by its c30,000 responses to the SC policy - but it strikes me as a classic example of the loud vocal minority - at risk of yet again taking control of the debate.

But 30,000 is a trivial number of the 24m plus domestic households.

Or even the 2m plus on tariffs like E7 for no doubt conventional electrical heating - who stand to be potentially significantly "harmed" financially by any simplistic shift to zero SC tariffs - as the two examples in their interim report clearly showed. 

Sometimes no response is a vote for the status quo - not a rejection of it or apathy.

I need to see more on the dual path route details - and how that will fit the "price cap" world - of course. But the options as originally presented - without a significant cash injection from govt  - really are not that pretty.

And the idea of one simplistic breakpoint can be used to re-balance fixed costs and unit costs - as per that interim report - fraught with problems.

Anyone below any simple threshold model who makes an active choice based purely on cost - will choose the low SC / higher unit cost - to save and everyone above will not.  Leaving a significant funding gap for those suppliers with respect to fixed costs - that will - you have guessed it - have to be met with even higher costs - for others  = cross subsidies from those regardless of their income.

And I look forward to the next consultation / proposal round - and like the last - I will be - despite being a low user - likely arguing against any non SC default - as it is fraught with cross subsidy risks.

People who are too poor to properly heat need real help - and not from those just marginally above some arbitrary cut-off.

And a proper re-balancing of the injustice of the current profile class 2 cap TDCV figures have on any attempt to do so as per that interim reports figures.

And would suggest the 2m plus on tariffs like E7 and with conventional electric heating and hot water systems should read that report to see the potential harm - and these new proposals - and make their voices - in support or against - heard.

jeffuk

MattMattMattUK said:

Increase fuel duty by 10p a litre this year and 10p a litre every year after and add 10% duty to all ICE vehicles, 

Wouldn't that be a tax on the poor who can't afford an EV/don't have access to home charging?

wrf12345

Fairly obvious is that the best thing to do is to completely drop the s/c's, allow a small increase in unit rates and force the energy retailers to absorb the rest of the cost. Whilst at it, average out the regional variations in unit costs, leaving the market with a simple single rate for electric and gas, capped for the std tariff and with fixed variations. Very simple to compare tariffs then.

MattMattMattUK

wrf12345 said:

Fairly obvious 

It would only be "fairly obvious" if one lacks the capacity to rationally analyse things.

wrf12345 said:

that the best thing to do is to completely drop the s/c's, allow a small increase in unit rates and force the energy retailers to absorb the rest of the cost. 

There is not enough profit margin for them to absorb the cost, they already make a very low margin, your "solution" would male them loss making. You are again demanding that low users are subsidised by higher users, that is an irrational position and one you have admitted multiple times that you want for selfish reasons. Being selfish is not a good way to decide energy policy, or any policy for that matter.

wrf12345 said:

Whilst at it, average out the regional variations in unit costs, leaving the market with a simple single rate for electric and gas, capped for the std tariff and with fixed variations. Very simple to compare tariffs then.

It is very easy to compare rates at the moment, firstly because no one can buy from different regions, they get a comparison for the rates available to them, secondly because working out SC and usage is far from rocket science and there are switching services, including MSE that will work it out for you if you lack capacity to make the calculation yourself. Finally and perhaps most importantly we need to and will be moving away from basic tariffs within a few years anyway, with the majority of energy usage needing to be moved to ToU tariffs, so there will be no single rate for anyone. 

MattMattMattUK

jeffuk said:

MattMattMattUK said:

Increase fuel duty by 10p a litre this year and 10p a litre every year after and add 10% duty to all ICE vehicles, 

Wouldn't that be a tax on the poor who can't afford an EV/don't have access to home charging?

It would be a tax on polluters, which is who we should tax.