Martin Lewis: Standing charges update risks households paying more

mmmmikey

Just to balance this a bit, to be fair to Martin Lewis I do think that he has been a superb advocate for consumer rights over the years and does a good job on the whole of representing public opinion. I just think he lost the plot a bit on this one.

wrf12345

The original nationalized companies were forced into efficiency by reducing their margins year by year to offset the cartel-like market they were running, don't know when that ran out of steam but should be re-introduced and Ofgem et al phased out as they keep on siding with the industry rather than consumer whilst paying themselves vast sums regardless of how poor a job they do. It is obvious that the only way a zero s/c will work is by making it the default tariff with an increased unit rate that overall only effects above average users, with other tariffs available for high users that could have double or treble the s/c but much lower unit rates.

WiserMiser

Martin has been an effective consumer champion for many years and he deserves thanks for that.  However, he's not infallible and he can occasionally get things spectacularly wrong.

I recall investing in Icesave in 2008 along with hundreds of thousands of UK savers, an Icelandic bank recommended by Martin because it was offering high rates.

Turned out it was too good to be true, and the Icelandic banking system collapsed...

Fearing financial panic and a run on the banks here, the UK government decided to rescue UK savers in full, costing taxpayers about £4.5 billion.

Qyburn

wrf12345 said:

<snip>  It is obvious that the only way a zero s/c will work is by making it the default tariff with an increased unit rate that overall only effects above average users, with other tariffs available for high users that could have double or treble the s/c but much lower unit rates.

As long as there are other tariffs available then you have to assume the zero SC option will be chosen by people like you who benefit from it. So you get a saving which has to be subsidised by others.

harz99

Qyburn said:

wrf12345 said:

<snip>  It is obvious that the only way a zero s/c will work is by making it the default tariff with an increased unit rate that overall only effects above average users, with other tariffs available for high users that could have double or treble the s/c but much lower unit rates.

As long as there are other tariffs available then you have to assume the zero SC option will be chosen by people like you who benefit from it. So you get a saving which has to be subsidised by others.

And conversely it can be argued that heavy users are being subsidised by very low or nil users as they both pay the same standing access charges for vastly different energy usage...the only fair way forward is to amalgamate the value of the SC into the unit rates so it effectively comes under the price cap, and to introduce a proper social tariff for those who really need it.

Either that or there should be at the very least, a cap system that ensured nobody pays standing charges which are higher than their actual energy usage cost.
 

Spoonie_Turtle

harz99 said:

Qyburn said:

wrf12345 said:

<snip>  It is obvious that the only way a zero s/c will work is by making it the default tariff with an increased unit rate that overall only effects above average users, with other tariffs available for high users that could have double or treble the s/c but much lower unit rates.

As long as there are other tariffs available then you have to assume the zero SC option will be chosen by people like you who benefit from it. So you get a saving which has to be subsidised by others.

And conversely it can be argued that heavy users are being subsidised by very low or nil users as they both pay the same standing access charges for vastly different energy usage...the only fair way forward is to amalgamate the value of the SC into the unit rates so it effectively comes under the price cap, and to introduce a proper social tariff for those who really need it.

Either that or there should be at the very least, a cap system that ensured nobody pays standing charges which are higher than their actual energy usage cost.
 

But many of those low users actually make more use of the grid as they export solar power, or import into their battery at off-peak times and export excess at peak times.  Do you expect them to have a higher SC, or maybe we should have an import SC and an export SC?

Or we could just spread the costs of maintaining the grid amongst everyone who uses it … 

Qyburn

harz99 said:

And conversely it can be argued that heavy users are being subsidised by very low or nil users as they both pay the same standing access charges for vastly different energy usage

Do you know how much of the costs covered by the standing charge actually scale in proportion to consumption?  As opposed to capacity, because we're not talking about low users being supplied via a low cost low power connection. 

debitcardmayhem

Also the standing charge will have £37 to pay for WHD, which of course means that it is only worth £113 for those receiving it. Further , those that don’t , pay the 37 for the privilege of not getting the help.

Qyburn

debitcardmayhem said:

Also the standing charge will have £37 to pay for WHD, which of course means that it is only worth £113 for those receiving it. Further , those that don’t , pay the 37 for the privilege of not getting the help.

Is that charged solely to electricity, or split across both?

debitcardmayhem

Qyburn said:

debitcardmayhem said:

Also the standing charge will have £37 to pay for WHD, which of course means that it is only worth £113 for those receiving it. Further , those that don’t , pay the 37 for the privilege of not getting the help.

Is that charged solely to electricity, or split across both?

AFAIK dual fuel
https://assets.publishing.service.gov.uk/media/67bda7d4b0d253f92e213c25/expanding-the-warm-home-discount-scheme-2025-to-2026.pdf
page 17