This is getting ridiculous (energy prices - Strictly NO referrals!)

[b0rn2sk8]

Not only that, for many its an advantage in that they see bills stability across the year.
Some people cannot cope with budgeting that in the summer their bills will be lower but they need to put more aside for the winter months.

Much like some other sectors I suspect we will see in future clients monies in dedicated accounts, so that the funds are separated from the business more clearly. (think like solicitors work for example)
Only when a bill is produced can that money be removed from the clients funds to the businesses accounts.
Bar a deliberate fraud that should reduce the risk dramatically of companies going bust having spent the clients money already.

That wouldn’t stop them from going bust, if anything it will increase it because of the need for additional working capital and the costs associated with that.

However, it would stop other consumers having to pay for credit balances of those customers who are left in the lurch which I guess is the point.

 

[Gammawolf]

This is a feature for most. Predictable bills that are consistent each month. It isn't some conspiracy theory by the utility firms.

The cost of money is then reflected in their pricing. If they aren't paying big dollar to loan cash then that saving can be past on.

This is basic economics guys.

There comes a point where its too low. No one said its a conspiracy, it encourages bad business practices with more cowboys entering. I can say from personal experience that i've chased the cheapest providers possible as a high energy user. To that effect i've been with 3 companies in the past 6ish years (GB Energy Supply, Extra Energy, Peoples Energy), all of which went bust and we got moved by ofgem. Between companies "losing" £200m in credits and various owners of some energy firms paying questionable family firms to do various "works" i'm very sceptical of these low cost competitors to the market that simply get customers using an unsustainable rate, siphon credit by paying themselves or family/friends, saying "oops get got no money" and then just go under and let ofgem/everyone else pick it up.

Stuff like this:

Avro Energy, whose directors are former footballer Jake Brown, 27, and Philip Brown, 57...

Avro Energy's latest published accounts, for the year ending June 30, 2019, showed a £2.25m payment to Sentido Marketing for "management charges".

Sentido's directors are listed as Jake Brown, Philip Brown and a third man, William Brown. The company is classed as an advertising agency on Companies House.

https://www.telegraph.co.uk/busines...o-energy-paid-directors-22m-despite-28m-loss/

 

[dlockers]

There comes a point where its too low. No one said its a conspiracy, it encourages bad business practices with more cowboys entering.

I'm unsure on the linkage you are making between utility providers allowing credit balances and flat out unscrupulous business owners?

And let's be honest, £2.5m was hardly enough to put a dent into the issue they were facing.

 

[Nasher]

Only places I can think of that wouldn't need heating are flats above a neighbour who likes it hot.

Suggesting you don't need a heat source in the UK at winter is ridiculous.

Even homes designed to be carbon neutral with heat exchangers struggle to maintain a comfortable home temperature in winter without any form of heat source.

The heatpump idea is quietly being scrapped. They banged on about it for a few years but now realised they are far to expensive to retrofit, cost a lot to maintain and not all that good.

 

[b0rn2sk8]

Source?

 

[Puzzled]

The heatpump idea is quietly being scrapped. They banged on about it for a few years but now realised they are far to expensive to retrofit, cost a lot to maintain and not all that good.

I was thinking more of those passive homes, the sort on Grand Designs where they are designed to be heated just by the people in them and the sun. One of owners did a rundown of costs and while it was extremely cheap to run, they still needed the heater on in winter.

If those sort of homes can't achieve it then your average UK house doesn't stand a chance. So those saying they never use the central heating in winter either have a different heat source, have neighbours who like tropical temperatures or just sit in the cold and tell themselves its comfortable.

 

[Gammawolf]

I'm unsure on the linkage you are making between utility providers allowing credit balances and flat out unscrupulous business owners?

And let's be honest, £2.5m was hardly enough to put a dent into the issue they were facing.

Fairly simple, it enables the unscrupulous behaviour more easily when the bar for entry is so low that anyone can create an energy company. Having credit is a risk to customers in any situation (See FSCS for banks). Customers cannot be expected to vet a energy companies business model which they have no dealings with in the same way they would a builder or carpenter. Yet most energy companies will take first payment on day 1 and force you to be in positive balance. If that floats your boat then sure, pay it like that. But where are the alternatives? If i want variable DD to match my usage then why don't they offer that as a requirement? The point is for most people they get rail roaded into a single payment option that favours the supplier immensely. Which is fine if they are a stable and honest supplier but I don't think i'd like to hear that i lost £400 credit when i wasn't given a choice of any other payment options and the energy company was doing funny business with other companies owned by the same people

 

[dlockers]

Fairly simple, it enables the unscrupulous behaviour more easily when the bar for entry is so low that anyone can create an energy company. Having credit is a risk to customers in any situation (See FSCS for banks). Customers cannot be expected to vet a energy companies business model which they have no dealings with in the same way they would a builder or carpenter. Yet most energy companies will take first payment on day 1 and force you to be in positive balance. If that floats your boat then sure, pay it like that. But where are the alternatives? If i want variable DD to match my usage then why don't they offer that as a requirement? The point is for most people they get rail roaded into a single payment option that favours the supplier immensely. Which is fine if they are a stable and honest supplier but I don't think i'd like to hear that i lost £400 credit when i wasn't given a choice of any other payment options and the energy company was doing funny business with other companies owned by the same people

Were going around in circles. You won't lose 400 quid because the government has protected the industry. You are free to pay for what you use, get a top up meter.

 

[Puzzled]

Were going around in circles. You won't lose 400 quid because the government has protected the industry. You are free to pay for what you use, get a top up meter.

You can also pay for what you use on a normal meter, you'll just lose the direct debit discount and have to send in regular readings.

 

[dlockers]

You can also pay for what you use on a normal meter, you'll just lose the direct debit discount and have to send in regular readings.

It is almost like predictable recurring revenues allows utility firms to operate more effectively and then they can pass a saving onto the end-consumer?

 

[chrcoluk]

I don't know, isn't that what usually happens when a company goes under? All I know is that the standing charge increases are extortionate, and I feel they're inflated for reasons other than paying of those debts.

For me the current way it works is very ill thought out.

There probably should be a choice and it been the default method of payment to have proper credit billing where your quarterly bill matches the reading, meaning your account is never in credit.

Then the subject of how to handle this weird billing system we have now (yes it is weird, no other industry does this in consumer space), we would either let people pay more than they used like now with the risk if company goes bust its lost, or have a government agency store the credit balances so they are in affect protected.

 

[chrcoluk]

It depends, in some areas yes, in others no.

As someone above mentioned I suspect that in future the market will be very different. Far more regulated, and therefore far less innovation.

You will probably find its all consolidates back into large companies, who will have no motivation to fight hard on pricing that was caused by the smaller companies.

Lets not forget, the main issue that caused most to fail was the price cap implementation and not corrected fast enough to avoid these companies going bust.
The price needed to be put up and quickly but was prevented from happening.

Something I saw was that the costs of all this storm damage will be factored in as well.

To me where you have to keep switching companies to get something cheap, its "fake" pricing. The deals were for people who kept switching. In affect the rest of us were subsidising, and even more so now.

Real competition is an increase in actual energy producers, not an increase in resellers.

 

[dlockers]

or have a government agency store the credit balances so they are in affect protected.

Yes, the root of all efficiencies is to get an intermediary government body involved to solve a problem that doesn't exist/net outcome would be identical but cost more

 

[arknor]

To me where you have to keep switching companies to get something cheap, its "fake" pricing. The deals were for people who kept switching. In affect the rest of us were subsidising, and even more so now.

Real competition is an increase in actual energy producers, not an increase in resellers.

same with internet if you never switch

 

[Mercenary Keyboard Warrior]

To me where you have to keep switching companies to get something cheap, its "fake" pricing. The deals were for people who kept switching. In affect the rest of us were subsidising, and even more so now.

Real competition is an increase in actual energy producers, not an increase in resellers.

But you didn't, you could get better rates from existing suppliers as well

Also it wasn't just about pricing it was about opening up the market to drive innovation.

It pretty much failed but that was the objective.

Again the market wasn't broken by these companies (directly). The main reason they failed was the price cap.
Which was introduced to try to help those muppets who never looked for a better deal
Maybe calling them muppets is harsh, many were vulnerable and some probably didn't even understand the evolution of the energy market.
If the companies had not been prevented from passing on the rising costs most would probably have survived and been able to adjust and evolve.

As it is now we are probably going to look to go back to a few very large suppliers, who will play safe, wont drive innovation, and with a close to oligopoly position likely not fight too hard for each others customers.

 

[arknor]

As it is now we are probably going to look to go back to a few very large suppliers, who will play safe, wont drive innovation, and with a close to oligopoly position likely not fight too hard for each others customers.

how do resellers drive innovation? they aren't National Grid, Northern Power grid etc.

did they even own a single solar panel or wind turbine between them? how many new meters did they fit?

I bet 0 to every question

 

[Holst1981]

We switched to avro a few weeks before they went bust.

We have been transferred to octopus but they can't bill us as they are waiting for avro.

Not paid a bill in months. Sending regular meter readings to octopus but yet to receive a price or bill.

Slightly worried we are going to get a unfairly large bill but I don't think there is anything I can do about it.

 

[Mercenary Keyboard Warrior]

how do resellers drive innovation? they aren't National Grid, Northern Power grid etc.

did they even own a single solar panel or wind turbine between them? how many new meters did they fit?

I bet 0 to every question

I believe the main innovation they were looking for was billing cycles, different rates etc, ie move away from the norm that the big 6 were offering.
Octopus being a great example of how when it works it works well
Some would claim the apps etc were a factor driven by these companies

Octopus certainly fitted meters so you lose your bet.

 

[The_Bullet]

People talking about the price cap being for "muppets" or mugs or whatever. Some people are stuck on the variable rate ( which rarely if ever differs from supplier to supplier) - private or council tenants stuck with certain complex meters for example, so the cap helps them.

 

[Illusion]

how would you be the one accused of "losing the money"?

You have no control of the money.

Sorry what?

If I had a credit balance with one of these companies that went bust I would have written it off, not bothered to try and chase them for it? So in this theoretical situation I lost money? I don’t see where I mentioned being accused either