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Energy pricing scandal grows by the day, but who has a policy to deal with it?

Npower is the latest energy company to put up its prices this autumn, by 10.4% on top of 9% last November, during a period in which the rate of inflation was a mere 2.8%. This will add £137 to the average annual dual fuel bill of £1,460.

The company, like others of the Big Six Ugly Sisters, blamed the increase on the rise in wholesale prices and on government-imposed green policies (though the impact of latter is tiny). Cameron’s answer to this dilemma is to change to another supplier, but when they all follow one another in lockstep, fat good is that!

Actually the government itself believes that a huge and continuing rise in energy prices is inevitable, as the Energy minister let out of the bag yesterday. He was at pains to sugar-coat the bitter pill of the public subsidy-driven deal with French EDF and Chinese

2 Comments

  1. ShirleyKnott says:

    Whoever owns the utilities, the current system of billing is completely iniquitous. The standing charges the big6 deploy penalise low users, and the reducing price per unit awarded to higher users rewards them for using more. It’s not just the gas and electicity, but water as well. This has to change. If we’re also to face the potential of shortages, then the following system is fairer *and* provides some flexibility for higher ’emergency’ price hikes to penalise those who would use excessively in times of shortage or drought:
    1) a basic ‘allowance’ per resident in a household per utility (this would be arranged from something like the child benefit number and/or NI number), with a higher rate for single resident, then a specific rate for additional members of a household – to be charged at the lowest rate per utility. The allowance should be higher for disabled and over 70’s.
    The size of the house or the gardens is completely irrelevent. The rest of the community should not be penalised because someone who *cannot afford* a large property will not downsize if their income reduces. This current ugly government insists on its ‘spare room tax’, yet would have the poorest of this country’s people subsidize many of its better off through the current utility pricing system, whether that be profligate use of fuel, or of water liberally sprinkled over large gardens or power washed over paths and cars.
    2) ABOLISH ALL Standing Charges! Enfold the cost of the utilities AND their provision into the unit price, whether power or water. As a matter of necessity, I’m frugal. I’ve found a power company (Ebico) that has no standing charges – BUT cannot do so with water. My water bills are TWO THIRDS charges.
    3) After the ‘personal allowance’ charged at a basic rate, there should be at least two further bandings (as per taxation) at increasingly higher cost. At times of shortage/drought, first the highest, then the middle, could see penalty increases to induce reductions in their usage. It is also in these bandings that the ‘green levy’ should be introduced.

    If applied meaningfully, then we should see a much fairer and far more honest billing system, whoever owns our utilities.

  2. ShirleyKnott says:

    Oops! Additional:
    Virtually 100% of homes have electricity & water, but not all have gas. Thus for all electric homes the basic allowance would be at a raised rate to cover the fact.

    The young family in the tiny social housing home with a postage stamp garden should be able to get out the kiddies paddling pool during a hot summer drought without worrying about the cost or feeling they are overusing, while the better off with a large garden should be a bit more concerned about pouring out gallons on their large garden just to keep it green. Water? Meters for all!

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