Zero standing charge tariff proposal

Warren_Muppet

Ebico used to offer a zero SC tariff with a minimum annual spend of about £100.Maybe similar could be offered by again?

Warren_Muppet

Ignore the "by" predictive text can be meddlesome

Doc_N

MattMattMattUK said:

This is an example of the problem of listening to those who shout loudest, rather than considering the information and making a rational decision. If one looks at the data on the Ofgem website it demonstrates that there is a very real risk that implementing this system will result in a significant shortfall in revenue raised and result in suppliers either being forced to sell below cost or for them to not be able to make the network payments. That will result in a short term (2-3 years probably) period where suppliers risk going bust and the network is underfunded, followed by a period of 5+ years where we have to make up for that. 

We need to stop listening to the shouty stupid people and start making rational decisions, or the cycle of boom and bust, of failure to make progress will continue. 

Martin Lewis may have got this campaign wrong, unusually, and there’s a real danger now of its backfiring against the very people it was supposed to benefit - the less well off high users in poorly insulated properties who use large amounts of energy not because they choose to but because they have to. The relevant charities are already expressing their concerns.

EssexHebridean

Unless I am confused or out of date though there is no suggestion that the only tariffs available will be zero SC ones - just that those should also be offered? My biggest concern is the number of folk who will decide that because they are no longer paying the SC it “must be cheaper” and will jump without doing the sums - indeed in some cases perhaps without having the ability to do those sums - and will end up costing themselves money they can ill afford through a simple lack of understanding and knowledge. 

Baldeagle095

In general I welcome the proposal to abolish standing charges. You get what you pay for.

There is a high correlation between income and energy use.

Obviously there will be losers with this proposal - the vulnerable, the sick etc who need to use large amounts of energy. They should be protected by the benefits system, where necessary, and encouraged to take measures to remedy poorly insulated homes etc.

I would venture that the majority of those that oppose this measure are already high income, high energy users.

Swipe

Doc_N said:

MattMattMattUK said:

This is an example of the problem of listening to those who shout loudest, rather than considering the information and making a rational decision. If one looks at the data on the Ofgem website it demonstrates that there is a very real risk that implementing this system will result in a significant shortfall in revenue raised and result in suppliers either being forced to sell below cost or for them to not be able to make the network payments. That will result in a short term (2-3 years probably) period where suppliers risk going bust and the network is underfunded, followed by a period of 5+ years where we have to make up for that. 

We need to stop listening to the shouty stupid people and start making rational decisions, or the cycle of boom and bust, of failure to make progress will continue. 

Martin Lewis may have got this campaign wrong, unusually, and there’s a real danger now of its backfiring against the very people it was supposed to benefit - the less well off high users in poorly insulated properties who use large amounts of energy not because they choose to but because they have to. The relevant charities are already expressing their concerns.

Yes just like the broadband and phone CPI + 3.9% change. Now we all get on average, 10% inflated bills every April, regardless.

QrizB

Baldeagle095 said:

I would venture that the majority of those that oppose this measure are already high income, high energy users.

Most of the opponents seem to be the energy poverty charities who campaigned for it, eg. from the BBC article:

"What Ofgem is proposing is more to hide standing charges within the unit rates, even allowing energy firms to charge more for the first units of energy which is completely the opposite from what we actually need," said Jonathan Bean, from campaign group Fuel Poverty Action.
Peter Smith, from charity National Energy Action, said the system would still be unfair and impact on the most vulnerable.
"We are particularly worried pre-payment meter customers may be left racking up increasingly unaffordable charges, which will continue to need to be repaid in full before they can turn on the lights or run a warm bath for their children," he said.

I wouldn't characterise those as "high income, high eneergy users".

Gerry1

Baldeagle095 said:
There is a high correlation between income and energy use.

Source...?

pseudodox

Their seems to be no correlation these days between the price of something and the cost + reasonable profit of supplying that something.  I am happy to pay a standing charge that guarantees I have light, power, heat, water etc available at the touch of a switch/button/tap 24/7/365.  I expect to pay the cost of connection, maintenance, overheads for offices & remuneration for staff.  But I don't like the idea that I am also paying fat cat salaries to pen pushers & dividends to shareholders over & above a reasonable level of operating profit which enables investment in updating infrastructure.

I then just pay for whatever amount of energy/water I require or can afford.  And in an unstable world the price of what I use is going to fluctuate.  I don't want to have a free availability but then be too nervous to actually use anything.  Even with a zero s/c there will still be many afraid to heat their homes.

Everything these days seems to get priced at whatever a supplier can get away with.  Why should a train ticket from A to B cost different prices to different passengers who are all travelling under the same conditions?  What is the real cost of the journey per head?  Why not the same price for everyone, covering the actual cost plus a profit element?

Neil49

Baldeagle095 said:

In general I welcome the proposal to abolish standing charges. You get what you pay for.

There is a high correlation between income and energy use.

Obviously there will be losers with this proposal - the vulnerable, the sick etc who need to use large amounts of energy. They should be protected by the benefits system, where necessary, and encouraged to take measures to remedy poorly insulated homes etc.

I would venture that the majority of those that oppose this measure are already high income, high energy users.

They do not intend to abolish standing charges, the option will be for consumers to select a tariff without them (albeit combined with higher unit rates).

Call me cynical, but I can't see any significant benefits with using zero standing charges for the average consumer. If you have a second home that is left unoccupied for a good proportion of the year then paying zero standing charges would be very beneficial but if you use large amounts of energy then you should continue to pay the standing charges as they stand. 

The energy suppliers aren't charities and they will ensure they don't lose out with these proposed tariff adjustments.