Energy companies' standing charges

[StandingStill]

If the standing charge is the charge for being connected to energy infrastructure, it shouldn't go up due to the cost of fuel, should it? So why is it going up?

I think they're pre-emoting govt action of some kind... which still won't make it affordable for families to heat their homes but will eat into their profit margins 😬

But even so there should be some kind of ostensible justification.

"Standing", to me, implies "fixed" or at least not volatile.

So how come it's gone up? Not just mine, yours as well, everyone's. So what gives?

They are greedy bastards

Part of the increase is to cover the collapsed firms and infrastructure, etc

How does one company going out of business cost the rest of them money? Surely they'll be quids in.

And what infrastructure has collapsed?

This right here ^

Yeah that's what it looks like.

I've been a "customer" (I use this word in its loosest sense) of three different energy companies in the past 15 months and the only thing any of them have had to do is bill me. And I didn't even get a bill for about seven months last winter. No one has even read my bloody meter. (It's ok, no need to send help or prayers, I can do it myself.)

So why has my standing charge gone up so much? What am I paying for?

31 businesses collapsed and the other companies had to take them on and any credit balances had to be subsidised. They make up that money with increased standing charges

www.forbes.com/uk/advisor/energy/standing-charges/

Wait until you find out about energy taxes....

So they have more customers? Ie are making more money than previously? And therefore are charging us more money because they have more customers and are making more money than previously?

'the standing charge is the charge for being connected to the energy infrastructure'. Only partly, its also the charge to cover the losses of the numerous energy suppliers that went bust in the last year. The bill for which is picked up by the customers of the remaining suppliers, British Gas, EDF, Octopus etc..

Those customers are likely costing them money. They are probably on the standard variable rate so are getting energy at a price lower than what the company is purchasing the energy at. Not all of the energy companies made a profit last year. Some reported losses.

Since you couldn't be bothered to read the article a previous poster linked.

"The new standing charge caps introduced in April 2022 also cover the administrative costs of switching failed energy companies’ customers to new suppliers.

According to research by the charity Fuel Poverty action, these administrative costs account for £68 of the £75 annual standing charge hike.

As a consequence, saving energy can only reduce your bills up to a point. Cutting energy usage reduces the amount of gas or electricity you have to pay for, but has no impact on rising standing charges, which remain the same regardless of the energy you use."

This is a consequence of government policy. Blame them.

Is it not the producers that are making money rather than the suppliers?

So I keep hearing.

But only on this thread and in that article. My own energy company says it's to cover the cost of connecting me to the infrastructure. If I'm paying for all manner of additional stuff then I want to be told and I want it to be costed and explained to me. By them. Not by someone on a talkboard. Although I'm sure you're very nice.

Why did you ask us then?

I thought standing charge paid for the maintenance and upkeep of the network

Dunno. I guess I wondered if there was an answer that wasn't "because".

Looks like that is the only answer though.

"How does one company going out of business cost the rest of them money?"

Broadly:

A lot of small companies set up when gas was comparitively cheap and lured customers to them with cheap deals. They didn't plan for a future when prices might go up, maybe hoping they'd make a killing if prices dropped. Prices went up. They couldn't provide the gas to their customers so went out of business.

Better run companies (generally larger) had looked at the number of customers they had and made a fair estimate of the gas they would need into the future. They bought this gas for months into the future, (this requires them to have funds to do this, another part of being better run), and could negotiate reasonable prices as the suppliers were assured of selling the gas. All of this is more expensive, so their customers didn't make the savings of those who opted for the cheaper companies.

The government does not allow the situation where some people just can't get gas, so the better run companies were obliged to take on a lot of new customers. But they hadn't pre-booked their gas purchases for these customers in advance so had to buy the extra gas at the higher prices at the time. They couldn't charge their new customers the higher price that they were costing the company, so they had to increase prices for everyone. Sometimes they had to change meters and other infrastructure for the new customers, which added to their costs. Their ongoing costs - salaries, insurances, buildings, maintenance, and yes, paying their lenders (ie shareholders) for their liquidity, etc - continued. As we know, the price they can charge at any time is capped, so as wholesale prices increased it got harder and harder to make up the loss.

Because ther can and they will

Exactly. Not for "every single fucking expense we have".

*they

Pointless thread then 🤷‍♀️

as wholesale prices increased it got harder and harder to make up the loss.

See this also doesn't square. Because most times wholesalers and suppliers are just different arms of the same company. They are selling to themselves, buying from themselves.

And expecting us to believe that the price is somehow set elsewhere (by God maybe?) And that it's just bally bad judgement that the suppliers who didn't have wholesaler arms are the ones who, dearie me what a shame, happened to go out of business and then, dearie me what a shame again, the suppliers who do have wholesaler arms are still in business but gosh darn it, those little guys going out of business means that we're losing money by having a massively increased customer base... Really?

Bent. As. Fuck.

It's been explained to you.

You choose to be ignorant because you would rather spew bile over your keyboard and be patted on the head for your anti-capitalist sentiment than actually learn what is going and what the consequences of government policies are to your cost of living.