Friday, November 16, 2012

Dear Gerald Kaufman MP

There has been much talk about rising energy bills, the confusing and wasteful marketing tactics of suppliers, etc, and now David Cameron is saying that they will have to offer the "cheapest" tariff, however that is to be worked out.

I would like to see the practice of standing charges outlawed. Standing charges, whether direct or disguised as differing tariffs for the first part of the consumption, amount to a poll tax on consumers. In today's world, no-one is expected to live without, at least, electricity; no matter how economical, consumers are forced to pay for the privilege of having a supply. The consequence is that those who, from poverty or environmental concern, use the least amount of energy, pay the most per unit of consumption. This is not only unjust, but a perverse incentive - those who are profligate users of energy will pay only a minimum tariff for every extra unit they consume - those who use almost no energy will still pay around £4 a week just to have a supply.

I would be obliged if you could raise this with OFGEM and/or the Department for Energy. In my view, the provision and maintenance of infrastructure should be paid for from the profits of the business. Obviously, the basic tariffs would need to be increased to make up for the loss of standing charge income, but this would mainly hit those who use excessive energy. It would give them an added incentive to economise, which should overall be more beneficial to the economy and environment than the minor savings squeezed out of the fuel-poor by the cost of standing charges.

I would add that suppliers should be forced to offer only one tariff for each product, eg dual fuel, economy7, nuclear-free, etc, instead of the current confusion marketing.