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Boncobill
The figure today was a warning - not an announcement of the actual rates. When the detail is announced (late August!?) it may be higher or lower.
The past increase in the electricity standing charge - largely to cover the costs from last years glut of failed supplier is indeed unfair. First it only applied to electricity users. So if you're an electricity only user your bill has gone up to meet the costs from some failed gas companies. Second, by loading the increase all onto standing charges, users of small amounts of electricity contribute just as much as those who use a lot of electricity.
The increase in the price cap looks backwards regarding supplier costs. So the rates we're paying now relate to prices in the wholesale market from August last year to January this year. The next price cap will be similar and because we're part way through the reference period its obvious that prices are on the increase again for the next price cap.
Suppliers though are probably losing money at the moment because of the rear view window of the price cap.
Generators of electricity though are probably making excess profits. Some suppliers are also generators within a holding company, but legally different. But if you think about a wind farm or solar farm or Nuclear generation they are probably making excess profits because their costs have not risen much while income has soared.
The price cap tariffs which in the past were to be avoided, because fix priced deals were much better, are now a protection for the majority of us. But trying to decided the best option - fix or variable - remains difficult because of the unknowns.
