Pre payment utility meters.
I pay £240 a year standing charge/rent for the pleasure of having these meters. Thats on top of a higher rate tariff and being unable to shop around for the best deals. These meters are normally in low income households. The standing charge should be scrapped it is unfair and effecting some of the poorest and most vulnerable people in society.
I am on gas and electricity pre-payment meters and British Gas do not charge me a Standing Charge.
To really make in roads in to alleviating fuel poverty we need to lobby government to push for variable VAT rates on domestic fuel at the EU level.
I have suggested those using below 80% of average consumption be 0% VAT rising to 20 to 25% for those using 200% or more of average consumption. Again middle income families would see no change and even the top income decile groups rarely get above 200%.
At the very least it would provide extra revenue for fighting fuel poverty and should encourage those who use more to be more proactive and mindful of their consumption.
I suspect much of Eastern Europe with older housing stock and the Mediterranean countries who are seeing high unemployment and economic problems would also back the opportunity to raise revenue from those who can afford to pay while creating jobs in insulating (or cooling) the poor.
I agree. I have posted a similar campaign idea pointing out that the average fuel consumption is made up of nearly one third by the standing charge based on DECC's latest fuel poverty report using 2010 data.
In 2010 average fuel consumption costs for the lowest income decile group was £750 on a mean income of £8,600 ie housing benefit plus JSA.
One third of this would now be made up of the standing charge. Redistributing the standing charge so that it was included in the unit price would ease fuel poverty for all those affected but would no way eradicate it.
This group under heat their homes by an average of 41% of modelled needs.
It gets me that one small not for profit company can run a billing company with such a model but the big six can't. You state £240 per annum Scottish Powers standard credit is around £235 dual fuel yet coops is £63 per fuel.
If the standing charge is the cost of transmission how come it varies depending on supplier and tariff?
It seems those on standard credit and prepayment are being used to subsidise other tariffs.
Including the standard charge with unit prices would benefit all below average users, would make little difference to middle income families and push most of the costs of transmission on to those who use more.
It is a myth that the poor use more energy.
a) The majority of them, 80% of the lowest income decile group iirc (needs confirmation), don't have the money to put in the prepayment meter much of the time.
b) The fuel poor are adept through necessity to conserve energy by modifying their behaviour.
c) Those who earn more have larger homes and can afford to use more and kick about in a t-shirt in the middle of winter.
The relationship between income and energy use is clear in DECC's report on fuel poverty which shows a positive correlation.
For many people on prepayment and standard credit the standing charge effectively wipes out the winter fuel allowance.
This would be worse for those who on standard credit fall foul of the prompt payment and eventually the dual fuel discount if they are unable to pay on time.
This creates exit barriers to switching energy supplier and likely leads to a court case and installation of prepayment meters.
To get off prepayment meters there is likely a charge for changing the meters back and barriers to making early repayments on the debt so they are less able to switch providers.