To think they are lying? ... electricity prices won't be going up by 50% in April ...

[Shouldbeworkingnotreadingtalk]

Keep reading that electricity prices are going to sky rocket by "upto 50%"... so I worked mine out whilst doing some house admin . . I'm shocked at the actual figures ...

We currently pay 21p per KWh of energy used. (Viable rate.) . Predictions once the price cap ends are for unit prices in April is anywhere between 40-48p per unit. . (From googling / Martin Lewis ), I could be reading this wrong ...

Or

I can fix a rate today with my current supply eon for 38p.

Is this maths right? (Well, I know it is!)

Say hypothetically we use a slightly higher than average 9,000 unit a year:

21p x 9000 = £1,890 (£157pm)
48p x 9000= £4,320 (£360pm)

Doesn't include standing charge or vat on those prices either!

That feels like a crazy hike, more like 120% increase (?) - so why aren't we being warned a bit more .... We are a ridiculously heavy user, (big house, tumble drier happy, old inefficient freezers in garage etc, no gas so everything electric,,) so this week I've condensed some freezer space, losing a big old girl that leaked ice, and ordered x2 airers for the washing.....
I'm still looking at many other ways to lower my kilowatt useage - (I've warned the fish their pond pump may have to go on timer ... ).

But my AIBU is that I'm miffed at 50%, surely it's much, much more and we are in for a huge shock?
VERY HAPPY (relieved) to be told I've got it wrong and IABU.

We currently pay £102. If we move to a variable rate in March, we’ll be paying £120 (I’m ok with that). If we move to another fixed rate it’s £240 (?!!!!?!). So our energy provider, at least, seems to think that over the next year the increase will be so brutal to make the 240% increase in fixed rates seem like a good deal!! We’re moving to variable and hoping.

As for the amount the cap is increasing, I thought it’s good up in April but the announcement of exactly by how much will be in February, so we can’t know yet.

Governments in Europe are coming up with strategies so I assume we will have something similar here

I don't think it's safe to assume. They don't see anything wrong with cutting the grant to councils, which has put council tax up massively despite cuts in services.

They will only do something if they feel not doing it will cause so many people to change the way they vote that they'll end up losing the next GE. And I wouldn't put it past them to put measures in place for 2 years and have the next GE a little earlier than May '24.

The big thing that Tory backbencher a want is going to be debated in parliament is removing VAT on energy bills. Obviously this could reduce bills significantly.

What's a sex pond

@LakieLady

Governments in Europe are coming up with strategies so I assume we will have something similar here

I don't think it's safe to assume. They don't see anything wrong with cutting the grant to councils, which has put council tax up massively despite cuts in services.

They will only do something if they feel not doing it will cause so many people to change the way they vote that they'll end up losing the next GE. And I wouldn't put it past them to put measures in place for 2 years and have the next GE a little earlier than May '24.

Exactly.

The current government has done absolutely nothing to support disabled people and those on lower incomes. Why would they suddenly change now? They’ll just expect everyone to either pay up or freeze.

@guardiansofthegalaxychocs

The big thing that Tory backbencher a want is going to be debated in parliament is removing VAT on energy bills. Obviously this could reduce bills significantly.

Not that significantly. VAT on energy is only 5%.

Yes. Not advisable to switch now. Energy is a massive international political issue. Govt would only intervene to support the big 6 energy retailers (who have extracted billions for shareholders instead of investing in energy efficiency measures eg insulation which would have reduced demand and hence exposure to price rises). If we'd done more on renewable energy wed not be so much at risk from Russia jacking up gas prices. The EU of course has more bargaining power than we do being a big bloc. Look up Energy Saving Trust ways to save energy, get solar panels if you can, this government isn't going to protect you.

I've just bought a house and you've guessed it I've been looking at switching and all the messages on go compare say "switching may not be a good idea right now" well that's great but I do need electric in the house !

@guardiansofthegalaxychocs

The big thing that Tory backbencher a want is going to be debated in parliament is removing VAT on energy bills. Obviously this could reduce bills significantly.

Not 'significantly' as vat is only 5%

@PersonaNonGarter, before privatisation, when energy companies were nationalised industries, price rises were controlled. When external factors meant costs went up, the government could (and did) protect domestic consumers by subsidising the price to the consumer.

They couldn't just put up prices, either, above a certain percentage it had to be agreed with the government via some quango I can no longer remember the name of.

I'm not convinced that energy company shareholders would be prepared to accept a lower rate of return on their investment to help keep prices low.

@YourenutsmiLord

You are paying a lot for electricity as it pays for windfarms - who do you think is paying for those if not the public? Generous chinese and danish companies are donating them?

Electricity prices subsidise gas, which was previously seen as a green alternative to coal..,,, so electricity loaded to encourage the move to gas.

@Limegreentangerine

I've just bought a house and you've guessed it I've been looking at switching and all the messages on go compare say "switching may not be a good idea right now" well that's great but I do need electric in the house !

But you will have electricity in the house! If you wish to switch provider you just don't choose a fixed rate tariff and go onto a standard variable one.

My heating hasn't gone above 12 already and its crippling me.
Were on pre payment meters too.

@rrhuth nooo, you’ve removed my hope! Was assuming it was 20%

The current government has done absolutely nothing to support disabled people and those on lower incomes. Why would they suddenly change now? They’ll just expect everyone to either pay up or freeze

Given that they've hit the non-working poor of working age harder than any other group, I wouldn't be at all surprised if they carried on in similar vein.

To use my earlier example of council tax, the government has not only made sure it's gone up, but they also abolished the national council tax benefit that gave those on (most) means-tested benefits 100% relief. Now, councils run their own schemes for working-age claimants, so any reduction comes at a direct cost to the council. It's a double whammy on the poorest. A 2-adult household on basic UC living in a band C property here will have to pay £400 a year, all but a few pence a week.

It would help low-income households far more if their benefits went up significantly than if VAT on energy was reduced. I can't see why millionaires in mansions should pay less for heating their swimming pools though, which reducing VAT would do.

We are being warned about it. Martin Lewis has covered barely anything else for months, he's on multiple TV & radio shows every week talking about it. If you try to change your utilities, the fixed prices have rocketed.

It may or may not be right to fix, depending on what you are offered. I looked at fixing and the gas rate was double, the electricity was about 40% up, so I left it as we'll just continue on the price cap rates, which are currently least expensive.

But the other thing we all have to do is look at reducing our usage and if we're doing environmentally irresponsible things like heating a hot tub with electricity(!) then yes we have to expect that to be very very expensive. As a nation, we don't have the resources for that sort of luxury any more.

Yesterday Gove said support for energy bills should target 'the poorest' so don't expect much.

And quite right, too. If people can make economies like switching off their sex ponds then they should do that first, before expecting their energy bills to be subsidised.

@EatYourVegetables

We currently pay £102. If we move to a variable rate in March, we’ll be paying £120 (I’m ok with that). If we move to another fixed rate it’s £240 (?!!!!?!). So our energy provider, at least, seems to think that over the next year the increase will be so brutal to make the 240% increase in fixed rates seem like a good deal!! We’re moving to variable and hoping.

As for the amount the cap is increasing, I thought it’s good up in April but the announcement of exactly by how much will be in February, so we can’t know yet.

I'm just looking at your figures, I've tried to guess your monthly usage .... as I think you will be in for a shock... (Like I was). So at the moment, you are paying £102, so roughly, I've assumed you using 630kw per month (I've assumed 16p as you're on a fixed rate) = £102

Current variable rate is about .21p - so times that by 630 units used is £132 (so roughly about right as per your post of £120 give or take)

Now, my maths isn't great, there's VAT, and standing charge, but you get the point...all very ball park...

HOWEVER, you are working it on the current variable rate, of .21p -.24p as that is what it currently is, but as @FourTeaFallOut points out, the rate on the 1st April is going to be (at least) .31p, so x 630 and your new bill is going to be £196 per month from 1st April ...

That's a huge % increase, more than 50% ....and I honestly think that most people just aren't aware of the huge hikes coming to them..
(It could potentially be as high as 40p. which would put your bill at £252 per month) .

I don't really follow the politics of it all, so I can't comment on many of the other replies, but it's clear we are all going to be affected. Maybe we should have a saving electricity thread?

@EileenGC

That sounds similarly to the increase they’ve seen in Spain over the last 12 months. The cost has gone up massively. It was at their all-time worst in summer, I went home to see my parents and my mum wouldn’t run the washing machine or dishwasher until midnight - during the day it was just too expensive to plug anything in. So many families affected by the increase, it was insane. It’s gone down a bit now after a year, but still much higher than it used to be. People are in for a shock.

Is it cheaper overnight???

If so I'll start doing this!

Most of these price hikes and the utility companies going bust coincided with COP26.

We have already done so much in the past 30 years e.g. LED bulbs vs incandescent, flat screen TVs vs the old "box" TVs, grade-A efficiency appliances, better insulation now, better recycling facilities, reduction in CFCs, ozone layer beginning to restore itself...

And yet Greta has doubled our energy rates and we have nothing to show for it. We pay double for nothing.

@DdraigGoch

Yesterday Gove said support for energy bills should target 'the poorest' so don't expect much.

And quite right, too. If people can make economies like switching off their sex ponds then they should do that first, before expecting their energy bills to be subsidised.

You are 100% right, and I realise that I am incredibly fortunate that I can switch off and save at least 5,000kw of power a year to "save money" .. This will just put my bills at the same price I am paying now, so in theory I am not paying out any more...

I don't expect my bills to be subsidised, especially not on non essential use, but I do worry that more isn't being thoroughly explained how much they are going to be increasing by... this upto 50% is nonsense... it's way, way more for many.

But it's not me I'm worried about... I am worried for everyone else, the poorest who are currently already feeling the pinch, but also the middle ground, who are "comfortable" but who are about to get a lot more "uncomfortable" when their bills rise from say £102 to £252 for example? (using my analysis of a previous posters use, I don't know their financial situation).

Maybe it's all just a ploy to get us to be more energy efficient

@Limegreentangerine

I've just bought a house and you've guessed it I've been looking at switching and all the messages on go compare say "switching may not be a good idea right now" well that's great but I do need electric in the house !

Someone I know has just bought a house, what we worked out is that electricity and gas will be on when you move in, all you need to do is contact the existing supplier, give them initial readings, and arrange a direct debit. Do not sign up for any plan, and they will charge you the regulated rate.

Apparently electricity and gas don't get turned off when one person leaves a property, all that happens is that at some point the new person takes over paying for it, after they move in.

There's no point shopping for a different supplier as it won't be any cheaper. (And may be more expensive, if they only take on people willing to pay more than the loss-making regulated rates.)

It’s only cheaper overnight if you choose the tariff that gives you a day and night rate. Like Economy seven.

@tricksyt some tariffs have cheap night rates. Economy 7 was a common one. Agile Octopus varies the amount you pay every half hour depending upon the wholesale price, however over the last few months the wholesale price has been so high that it didn't yield and savings. I did enjoy three nights of negative rates over the New Year Bank Holiday though.

Britain uses a LOT of natural gas to generate electricity (you can see here if you like: (gridwatch.co.uk/demand/percent).

Before Jun '21 -- prices per therm on the world market were between 9p to 80p over the previous 5 years. Since Jun '21 prices went up and up to 451p - but has dropped back to 200p right now... still two and half times the HIGHEST point in recent years.

That is the cause. Turning off nuclear generators in Germany and now a couple in the UK and not wanting to burn coal has a real cost - especially when the wind hardly blew over the last 6 months.

Wind power will do more in the future - a new stite just started generating more with many more GW of capacity due to come online over the next few years.