OFGEM Price Cap

[Countrypaul]

Can't see it being done automatically, will get far to complicated - I'm sure they will just dump it onto everyone, as suggested either via the standing charge, or an increase in the cost per kWh.

How would you expect the muppets to cope with imigration, emigration, marriage and moving into 1 home from 2, divorce and moving into 2 homes from 1, second homes, long term care and ufortunately, of course, death? If they try and cope with those and many other less than straightforward cases it will merely result in a large lucrative contract for some foreign owned outfit, that will deliver a not-fit-for purpose solution, with large cost overruns resulting in all of us paying 2 or 3 times (OK I'm being optimistic) the amount that is due to cover for the costs of the excessively complex system.

There is always the small chance that the next party in power will dispence with the oustanding rebate and leet us all off

[Stinsy]

I imagine most of us have seen the news about the 50% hike in the OFGEM price cap and its been no surprise to us. When I read the OFGEM press release I tried to find the actual info on the kWh cap and the standing charge cap for gas and leccy. The kWh cap was in there but the standing charge cap was not. On TV there was an interview with OFGEM who said they was a circa £68 increase for the failure of supply companies but no info about how those costs were hidden in the actual bills. I.e. in gas or leccy kWh or the standing charges.

From OFGEM press release


I notice Martin Lewes (MoneySavingExpert) tweeted last night a simple table which included the missing info as I think he had a meeting with OFGEM yesterday. Standing charge on gas goes up about 1p and the standing charge of leccy goes up nearly 23p.

I suspect its because not everyone has gas so its the easiest way to reclaim the cash but if you were cynical, you could argue its another hidden subsidy on FF by disproportionally adding unavoidable costs to renewables.

If the table is true, one can only speculate what will happen to the rates in the near future on Octopus Go, Intelligent, etc.

Martin Lewes tweet

The standing charge is the most regressive part of the energy bill! Why not have a negative standing charge of £10 or whatever? Then those who use least electric would save the most.

[nowty]

Marin Lewes has updated his twitter answering whether the £200 credit can be opted out of and as I suspected, he has published,

Just to clarify in practice the £200 bill-credit 'loan' on all home elec bills in Oct.

- every bill will reduce by £200
- every bill after Apr 23 increases by £40/yr for 5yrs regardless of if you got the £200 or not.

[Petertc]

I have found that they put the standing charge up more than the unit cost which doesn't exactly persuade people to use less. And I bet when prices go down the standing charge won't.

[ecogeorge]

My ptnr currently sorts the electricity bill and ive been thinking ........
She gets the credit (buy now pay later loan) into her account ........
We move house in the future and put the electric in my name . Who pays what back ? how? will they find her ?
George

[nowty]

My ptnr currently sorts the electricity bill and ive been thinking ........
She gets the credit (buy now pay later loan) into her account ........
We move house in the future and put the electric in my name . Who pays what back ? how? will they find her ?
George

It has been pretty much confirmed now that every leccy bill payer will pay the levy for 5 years from April 2023 whether they received the credit in Oct 2022 or not. And it will almost certainly be added to the leccy standing charge so you cannot avoid it unless you go offgrid or move abroad. Changing names wont change a thing.

The levy will be about 11p per day, maybe 11.5p if the VAT is added.

And its been touted that bills could rise again in Oct by another £200 so it may only compensate for the next rise.

[spread-tee]

Good discussion here how the whole energy "market" is a total f**k up

https://www.taxresearch.org.uk/Blog/202 ... al-reform/

still the big producers costs have barely gone up so they are making a killing, which is great for the trickle up economy. So all is well suckers.

Sunak could have raised a windfall levy on them and targeted help for those who really need it, but hey why would he do that??

Desp

[Ken]

Octopus agile looks cheap all of a sudden ?

[AE-NMidlands]

Octopus agile looks cheap all of a sudden ?

but I imagine they will have no choice about levying and passing on the 20p aday increase in the standing charge.

(I had been thinking my Octopus/Coop tarriff would be set and stable until it ends in October, but now I am not so sure: They can't afford to absorb that much cost per consumer, can they?)

[nowty]

Octopus agile looks cheap all of a sudden ?

but I imagine they will have no choice about levying and passing on the 20p aday increase in the standing charge.

(I had been thinking my Octopus/Coop tarriff would be set and stable until it ends in October, but now I am not so sure: They can't afford to absorb that much cost per consumer, can they?)

So if you are on a fixed tariff its not subject to any OFGEM caps so it wont change until after it ends. But I'm not sure about the Oct rebate and increase in Apr 2023 for 5 years onwards. The increase is over a year away and most fixed tariffs are a year, but some are 2 or even 3 years. My father is on a 2 year deal which ends July 2023, so does his bill get hit by an enforced increase in April 2023 even though he will still be on a fixed rate.

There could well be some unintended consequences as always happens when government makes rushed weird changes to things.

I believe that the supply companies wanted themselves to have access to government loans in order to keep their rates low so the cap did not need to rise too much, but the government has decided to let the prices rip and to implement a different HELP scheme. I think this puts suppliers in a very difficult position, especially over long term fixed rates.