Electricity and Gas prices

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pabenny
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Re: Electricity and Gas prices

Post by pabenny » Sun May 01 2022 2:06pm

macliam wrote:
Sat Apr 30 2022 5:51pm
There is still no reason why the cost of provision of the same product to different areas of the UK should be different.
Have you mentioned that to Tesco, Sainsburys, et al who charge different prices to each other and between different store formats? Have you mentioned that to filling station operators whose prices can vary from one street to the next? Should Heinz beans be the same price as own label beans?
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Re: Electricity and Gas prices

Post by macliam » Sun May 01 2022 4:02pm

As you'll know, there are discounted prices and loss leaders - but a tin of beans in a Tesco in Blackpool will cost much the same as in Hastings.... so the comprison is false. If you'd like to suggest a way in which the standing charge applied to my bill is the equivalent, I'd be interested.

As has been pointed out, the scheme is to charge as much as they can get away with, "justified" by the differences in transmission costs. Perhaps my costs should be lower or higher than someone 5 miles away, depending on the way the energy is carried?
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blythburgh
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Re: Electricity and Gas prices

Post by blythburgh » Mon May 02 2022 8:10am

OK so this is off topic but about beans. A tin of Heinz beans will be one price in Tesco supermarket, a little more in smaller Town Centre shops. The ones in the little Tesco shops will cost a little more than in the Town Centre shops. And if you go to the One Stop shops which are run as franchises or direct by Tesco with a manager you will pay even more. The same shopping basket but different prices from different Tesco shops
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Re: Electricity and Gas prices

Post by macliam » Mon May 02 2022 10:09am

blythburgh wrote:
Mon May 02 2022 8:10am
OK so this is off topic but about beans. A tin of Heinz beans will be one price in Tesco supermarket, a little more in smaller Town Centre shops. The ones in the little Tesco shops will cost a little more than in the Town Centre shops. And if you go to the One Stop shops which are run as franchises or direct by Tesco with a manager you will pay even more. The same shopping basket but different prices from different Tesco shops
That's due to mark-up and the costs of premises and staffing. Obviously costs reduce for large, high-sale, low rent/low rate, out-of-town outlets, that's their raison d'être. You could as easily point to the differential pricing between competitors (as has been done). None of this is equivalent to the standing charges applied to energy bills.
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Re: Electricity and Gas prices

Post by pabenny » Mon May 02 2022 10:56am

macliam wrote:
Mon May 02 2022 10:09am
None of this is equivalent to the standing charges applied to energy bills.
Why not?
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Re: Electricity and Gas prices

Post by Chadwick » Mon May 02 2022 11:36am

I think there's a bit of both sides in the standing charges. On the one hand they do reflect the actual costs of supplying that area. But I think the power companies also use them as a place to hide additional cost using the excuse of additional costs. They probably could even out the standing charges a bit if they wanted to.

In the same way, other costs could be the same across the country: beans, parcel delivery to highlands and islands, petrol, houses. But you then lose the ability to make money out of thin air by 'responding to demand'.

Forcing equal costs across the country also runs contrary to the principle of the free market economy. If we wanted state-mandated control of how a private business makes its profits, we should have elected Jeremy Corbyn blah blah blah...
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Re: Electricity and Gas prices

Post by macliam » Mon May 02 2022 11:51am

pabenny wrote:
Mon May 02 2022 10:56am
macliam wrote:
Mon May 02 2022 10:09am
None of this is equivalent to the standing charges applied to energy bills.
Why not?
Simply because the standing charge is a non-transparent differential applied to an entire region with no opportunity to "shop around" to avoid it - and a charge based on what used to be, not what it. It is just a "fluff factor" that can be applied to cover whatever the vendor chooses to leave out of the unit cost.

In my region, the growth in population and delivery of energy has grown hugely in the past 20 years, yet the standing charge is still higher than elsewhere based on supposed "costs" pre-privatization.
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Re: Electricity and Gas prices

Post by macliam » Mon May 02 2022 11:54am

Chadwick wrote:
Mon May 02 2022 11:36am
I think there's a bit of both sides in the standing charges. On the one hand they do reflect the actual costs of supplying that area. But I think the power companies also use them as a place to hide additional cost using the excuse of additional costs. They probably could even out the standing charges a bit if they wanted to.

In the same way, other costs could be the same across the country: beans, parcel delivery to highlands and islands, petrol, houses. But you then lose the ability to make money out of thin air by 'responding to demand'.

Forcing equal costs across the country also runs contrary to the principle of the free market economy. If we wanted state-mandated control of how a private business makes its profits, we should have elected Jeremy Corbyn blah blah blah...
NO, again this is not a "free market" argument...... there is NO free market as standing charges are applied to a region. Do we pay more to send a letter to Scotland, rather than next door? Do we pay more for a telephone call depending where we are? Is the postal and/or telecoms network somehow magically free of the "costs" claimed by the energy sector?
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Re: Electricity and Gas prices

Post by pabenny » Mon May 02 2022 1:14pm

macliam wrote:
Mon May 02 2022 11:51am
It is just a "fluff factor" that can be applied to cover whatever the vendor chooses to leave out of the unit cost.
Not true. Standing charges are controlled by the regulator - or more specifically, increases in the standing charge are controlled.
macliam wrote:
Mon May 02 2022 11:51am
In my region, the growth in population and delivery of energy has grown hugely in the past 20 years...
As it has across the country.
macliam wrote:
Mon May 02 2022 11:51am
Do we pay more to send a letter to Scotland, rather than next door? Do we pay more for a telephone call depending where we are? Is the postal and/or telecoms network somehow magically free of the "costs" claimed by the energy sector?
We used to pay more for long distance than for local calls but as cost drivers changed, that differential was removed. And I think the answer is that postal costs *do* vary little according to distance - the majority of cost (ie labour) is in the first and last mile rather than trunking.
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Re: Electricity and Gas prices

Post by macliam » Mon May 02 2022 1:57pm

The actual justification for the charge has not been re-examined.... it is a "fluff sactor", rubber-stamped by a useless regulator.

Percentage changes are available.... it is a statement of the obvious to say that changes have impacted some areas more than others.... and those areas with a previously lower customer-base have changed.

Again, with reference to postal and telecoms (that includes internet) charges, we are talking about now, not what used to be. Plus, of course, the fact that these variables have been equalized elsewhere shows exactly how they could be equalized in energy distribution.

I have to say everything being posited is extremely defensive.... things are as they are because they were that way 50 years ago; energy is somehow different to every other sector; it's all justified really, we just can't be bothered to tell you how.....

We are talking about a sector that has systematically failed the consumer and where that same consumer is now being forced to pick up the costs of poor regulation and poor business management - and you are really trying to justify that?!!
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