Energy Price Cap Based on Average Household of 2.4 People

[smooththecat]

I know, another thread about this. There’s been a lot of criticism of the usefulness of the energy price cap as a way of understanding our bills. Found out today (on the Guardian Today Podcast) that this price cap is based on a household of 2.4 people, so a couple of adults with one child would be above this size, if I am understanding this correctly. More proof that this price cap is worse than useless as a way of understanding this.

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I think the average household uses 2800kwh of electricity and 12000kwh of gas.

I don’t think they work out on people rather usage per household.

The price cap isn't based on the number of people in the home or usage. It's the maximum amount that energy suppliers can charge for each unit of energy.

The only thing based on a household of 2.4 people would just be an illustration of the cost to an "average" household.

We really need to ignore the figures quoted in the media in terms of £'s, which are based on usage of 12,000 kilowatt hours (kWh) of gas and 2,900 kWh of electricity each year for dual-fuel customers who pay by direct debit. Those figures won't be relevant to many, many people because of variables - whether usage is above or below that, whether they're on a fixed rate or don't pay by direct debit, for instance.

The only thing based on a household of 2.4 people would just be an illustration of the cost to an "average" household

I think that's what the op is saying.

Lots of people will be looking at the advertised annual £ figures for the price cap and going 'omg I can't afford £5k a year!' without even realising that this is the rough/average figure you'd be expecting to pay if there were 2.4 people in your house - and many larger households will be even more.

We're a household of 5 and after adding up my last 12 months usage, we use 1.7 times the price cap average use amounts. Looking to get it down but no way will we manage the 'average' usage.
For many households, for a reasonable standard of living it isn't even possible to get it down to the already scary average figures.

The price cap is worked out based on wholesale prices, I don't know what you're getting at. It doesnt have anything to do with the number of people in your house or how much anyone uses

news.sky.com/story/energy-bills-to-soar-for-millions-as-price-cap-hiked-to-3-549-12681213

@AllThatFancyPaintsAsFair - 'price cap hiked to £3549'. The op is talking about this £ figure bandied about in the media.

This £ figure is what you'd pay if you used the amount of an 'average household', which is 2800kwh of electricity and 12000kwh of gas.

An 'average household' is considered to be that with 2.4 occupants. Meaning many people will pay far more than £3549.

That's not the way I read the OP, it's not clear to me that the poster understands what it means at all

I agree that the general reporting of this is very poor but there has also been soooo much information online that no one should not understand who their energy costs are calculated. It's explained on here every day many times

Yes, the £ figure shouldn't really be used IMO as it's meaningless other than comparing rises (but then a % figure would work just as well). It just leads to confusion as using the term cap and then using a £ figure suggests that you won't pay more than that figure, which is obviously not the case as the cap is on unit prices, not overall costs. But it's been poorly communicated and explained in the months leading up till now.

It's not even just headlines; I've seen plenty of news stories that don't explain it properly so even reading the article won't enlighten someone who doesn't know what it means.

It also means that people in smaller households think they will be paying £3,800, so you have pensioners afraid to turn on the heating when they will often be much smaller users. I've seen a lot more places using the % figure now though so hopefully that'll lead to less confusion.

And it's a place of privilege for those of us who can understand what it means and have the requisite skills to find out information for ourselves online. Financial literacy in the UK is shocking. I'm no mathematician but in the energy support group I'm in, there are people unable to even read their meter, much less work out costs from their bill or understand the explanations. That's obviously another issue, but assuming everyone can understand or knows how to find out information is sadly incorrect.

We're an all-electric household so the price cap figures are also useless in terms of what we should expect to be paying in future.

I keep a detailed record of our monthly consumption anyway, but it's very difficult to find figures for average consumption for electric-only to benchmark ourselves against.

My feeling is that we're unlikely to be able to significantly reduce our usage without changing the way that we heat the property (currently storage heaters which are cosy but leave little room for flexibility) which also comes at considerable cost.

I keep a detailed record of our monthly consumption anyway, but it's very difficult to find figures for average consumption for electric-only to benchmark ourselves against

Can I ask why you need to do that? The average is meaningless, you need to check your own usage and look to see if you can reduce it. If you're at your personal lower limit it doesn't matter what anyone else is doing

The way to work out how much you will pay is to take your meter reading every month and work out how much you have used that month. Then multiply that by how much your electric company are charging you per KW.

No other figures matter, I don’t understand why the media can’t explain this clearly.