Soldato
Why jump if its always cheaper than svr……dont get it.
Energy Prices (Strictly NO referrals!)
- Thread starter DXP55
- Start date
Because it isn't always cheaper, it has risk that it may go above. As humans all we do is manage risk.
Nothing about agile unit calculation going up in the email I got, only standing charge and moving to 1yr fix tariffs. Works best with battery though.
This basically and it’s due to the way our retail energy prices are set. Tracker prices are 3-6 months ahead of capped SVR prices.
In a falling market the tracker is going to be cheaper, that is the current situation. You are benefiting from the price cuts more quickly.
In a stable market, they should be roughly the same.
In a rising market, you’ll want to be on a fix/SVR tariff.
If you stick to one or the other over the course of several years, in theory they should come out in the wash as about the same. Perhaps the tracker will be slightly cheaper because Octopus doesn’t need to raise capital to buy energy 12 months ahead which has a cost. They are probably doing it anyway to hedge against future prices because people can jump ship if it hits the fan.
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It’s worth noting in the summer/autumn months last year, it was as cheap as 10p average for a month.
Tracker moves. Normally Jan-Mar the priciest time for leccy due to long night and not as much wind.
It wasnt 10p average for entire months at a time.
Soldato
This is just sensible advice anyway surely? I don't know why people would want large credit balances, better earning you something in savings.
It's also why I just pay variable DD, so I'm never sat in credit!
Soldato
Tracker remains cheaper than SVR still, it could change again when the SVR drops 16% or whatever, but typically in the better weather energy is cheaper, so I expect tracker will remain competitive until autumn/winter.
Soldato
Just wait for all the complaints if Octopus take more than 30 seconds to move anyone switching off Tracker.
When the T&Cs say a considerable time can be taken.
There is no such thing as SVR atm. They are all capped.
SVR should be what octopus tracker is albeit price doesn’t change daily but half yearly based on the old regime and now quarterly. SVR should have always been a close aligned thing with tracker. So if tracker over the last 3month average 15p/kwh the SVR should have been similar.
There will be others here who argue SVR is looking ahead 3 month blah blah blah. But then again so is tracker albeit by 1 day. Both are forward looking and the resulting difference being 45% is stark.
Another thing with SVR or currently know as Capped Rate is that Ofgem calculation looks back at profit margins and build in additional cost in forward planing of capped rate to recoup loss or increase profit margin for suppliers. All of which sounds dodgy AF
Soldato
They called out 2 weeks in their blurb for the switch
Disagree with this to a point, SVR is primarily made up of costs of energy bought on contracts well ahead of time. Tracker is using spot pricing daily based on wholesale costs.
The former probably has higher costs baked in due to risk, because future outlook can be uncertain that far ahead, especially in this climate with Russia/Ukraine war etc.
Gas tracker has been far cheaper for me over the last year, I'd say it's been about 40% less than SVR.
Caporegime
Yes, its just pure laziness from my end.
Caporegime
I would do that but I am currently about £100 in the red with them
We had our DD set to £80 for a good while due to having a bit of a balance but my dear partners desire to live in a warm(er) house and leave doors open wherever she roams has quickly pushed our monthly up to about £180 over this cold spell.
Soldato
Actual facts though, supplier profit margins are not crazy. The recouping of losses is being done through the standing charge not the capped rate. The 3 month ofgem review now doesnt seem to work as many thought it would, prices dont really seem to follow the wholesale that close.
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Soldato
I am sure I read somewhere the "old suppliers" would purchase up to 12 months in advance.
So they have quite a lag when prices are rising or falling.
Cap would have looked fine if the impact of Russia had not been so significant.
But as it was the cap pushed loads of suppliers out of business. People have all but forgotten that the true domestic price per kWh should have been closer to £1 than 40p at that point.
Gas should have been more like 30p a kWh
Only because the books are cooked and the wholesale provider (also them) makes a killing.
I'm afraid I might need it all explaining to me like I'm 5.
So "SVR tariff" so to speak is basically where prices can be changed as often as what? Monthly? Weekly? Daily? You have no guarantee of prices at all, hence why people used to do fixes?
Fixes = fairly obviously fixed prices for X period.
Tracker tariff the prices can and do change daily right?
Why are people saying if tracker get's near to SVR they will switch? I read that as, if tracker gets close to SVR (but still below) they will switch. Why?
*sorry for silly questions!
So "SVR tariff" so to speak is basically where prices can be changed as often as what? Monthly? Weekly? Daily? You have no guarantee of prices at all, hence why people used to do fixes?
Fixes = fairly obviously fixed prices for X period.
Tracker tariff the prices can and do change daily right?
Why are people saying if tracker get's near to SVR they will switch? I read that as, if tracker gets close to SVR (but still below) they will switch. Why?
*sorry for silly questions!