Flash-Mob Meets Bait And Switch?

There’s a news item on the Beeb about a European scheme to encourage mass energy supplier switching. I have to say I’m not convinced by these schemes. To me it’s a bit like a lemmings flash-mob running head first into a bait and switch scheme which will always be funded by other consumers paying over the odds. It’s simply not a sustainable scheme and certainly not a long term answer to rising energy bills.

Image by Ian F Thomas under this creative commons licence

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Hi Energy

There’s an interesting poll on Slashdot that asks what people are paying for their electricity per kWh(kilo-watt hour). There seems to be a wide latitude of energy prices across North America and that contrasts starkly with the sort of cartel-a-like prices we seem to pay in the UK though it’s not an entirely accurate picture as many in North America are charged  generation, transmission and distribution prices in addition to the given per kWh price (I assume that’s similar to the standing charge that many UK energy providers employ).

I was interested to see how common lower priced first tier pricing for the first x number of kWhs is rather than the insane reverse situation that occurs in the UK where the first x number of kWhs are often charged at a higher rate thus  low consumption is penalised because that majority of a low energy use bill would be charged at the first tier higher rate. In the UK some are literally charged a premium for their frugality or energy efficiency.

Also common in North America it seems is being charged a higher rate in the winter compared to the summer which hasn’t been used as yet in the UK.

Again more common in North America is house rental where the energy bills are included as part of the rent and in some cases even an agreed fixed monthly charge for business users. The former situation is not unknown in the UK but is quite rare. The latter situation re a businesses fixed energy fee I have to say I’ve never come across in the UK.

The only way I can see that UK electricity users can ensure lowest rates for their usage is to consume the majority of their electricity during the cheaper economy 7 night rate (assuming you have that tariff) which basically means living or working more in the night hours. Great if you don’t mind living in the night hours or can automate your heating, cooking, washing etc to occur during these off peak periods.

The Slashdot poll perhaps highlights the lack of competition in the UK energy market and probably too the degree to which we are not self sufficient in its generation.

Will this ever change?

Link

CITY FOCUS: Upstarts take on Big Energy as Huhne plans to make switching between accounts easier

 Curious statement of Tariff prices here.Why do we always base likely costs on a one-size-fits-all average total cost? Does it take into account standing charges (if any)?.Why not show three averages including low energy user, average and high energy user as the results will usually be different for each.
That aside it’s good to see the lesser know providers getting a mention.
Warning: Link is to the Daily Mail site (don’t say you weren’t warned.

Paying A Premium For The Familiar?

Landlines. I often wonder how long many will put up with them in the face of ubiquitous mobile phones and voip services but seemingly many can’t give up the habit of the familiar. British Telecom in the UK are to increase the cost of daytime calls to 7.95 pence per minute excluding the connection charge and accompany that with an increased line rental.

My pay-as-you-go mobile phone service charges only slightly above that to call landlines and mobiles at 8 pence per minute and free between people on the same network. My home phone voip service charges 0.06 pence per minute to UK landlines. That BT price is hardly competitive is it? And yet the use of landlines still continues.

What is the price rise about? Less people using landlines? Increased costs? Because they can?

Image by HowardLake under this creative commons licence

‘Ethical’ Co-op Offering Gas And Electricity Alternative In The UK

The Co-operative are relative newcomers to the UK energy supplier market but are a welcome alternative to the ongoing dominance of the big six suppliers.

No Shareholders

Being the co-op they have no shareholders, offer money back for co-op members and are attempting to be ethical and transparent. It’s hard to be a small energy supplier in the UK due to the way the market operates so I have to assume they’re partnering with one of the big six if only for the purchasing of energy at a price that makes it viable for them, as a small player, to even operate.

It’s interesting to see the Co-operative’s breakdown of how the supply of gas and electricity is costed which is refreshingly honest.

Price wise they’re offering a non tiered pricing structure so no consumer is getting penalised with paying higher rates if they are a low energy user as is the case with many UK electricity and gas suppliers who charge a higher rate for a certain percentage of KWh consumed each month or quarter before lower priced rates kick in.

The only fly in the ointment with regard to the Co-op pricing is a yearly standing charge of £63 for electricity and the same again for gas.At least it’s clearly defined so for a customer taking both gas and electricity this would work out as a fixed £10.50 a month standing charge in addition to energy consumed or £5.25 per month for either just gas or electricity alone.

Not Claiming To Be The Cheapest

The Co-op are not claiming to be the cheapest supplier at the point of sign up but they’re trying to be very clear about their prices and not locking people in to any deal so there’s no penalty for leaving. They criticise many of the big six for offering temporary low rates in order to attract new customers in the hope of lperhaps ocking them into inevitably higher rates at a later date (though the Co-op seem to be temporarily offering a £50 money back to attract some customers at present but at least the consumer is free to leave at any time with no penalty costs).

How Much?

A PDF of their domestic energy prices as of June 2011 is available here

Nearest Competitor

Alternatives in the slightly cartel-like world of UK energy suppliers are always welcome. The nearest competitor to the Co-op stall would be not-for-profit company Ebico who are another declared ethical supplier.

Who Pays For Banking?

Vodpod videos no longer available.

UK banks have won their appeal at the supreme court over the matter of unfair bank overdraft charges.

David Buick, market analyst with inter-dealer brokers, BGC Partners was interviewed on BBC radio this morning following news of the judgement. Whilst he did not argue against the accusation that the banks precipitated the recession he took the view that in the current economic situation a ruling against the banks would have been an administrative and financial nightmare and took the view that the era of easy credit pointed the hand of blame at all of us. He also forecast more draconian overdraft terms in the future.

Of course were the banks not in the financial pickle that they’re currently in then we might have seen a different judgement. Clearly having averted a worldwide banking collapse would not be helped (in our capitalist system anyway) by the legal requirement to then manage a deluge of charge reclaims by numerous individual bank account holders.

That’s not to say that the judgement is correct. The argument is whether the Office of fair trading really has the powers to regulate effectively. The supreme court clearly indicates that it feels it is not in the OFT’s  remit to have brought this action and points out that this decision is not a judgement is not about whether overdraft charges were fair but that the OFT cannot and should not have instigated this action on behalf of consumers. That perhaps is  an argument for regulators with real teeth rather than having quangos of consumer rights tokenism.

It’s worth pointing out that if the ruling had gone against the banks then they would have taken their case to the European court

Can the consumer ever really win? In Australian credit card hidden charges were regulated against but all that happened was that the credit card companies were able to tack on a raft of new charges with fees that exceeded the old hidden charge fees. Better the devil you know?

The same may have also applied to a ruling against the banks with the probable introduction of a monthly account charge for all account holders. Maybe in future the privilege of having an overdraft will incur a fixed monthly fee whether you used that facility or not.

Martin Lewis the consumer champion who pioneered the reclaiming of excessive bank charges may well have more to say on this subject.

The full supreme court judgement is available here (PDF)

 

Consumer Item Limbo

“For the love of God give me my item”. The man in front of me in the queue at the Argos store had finally lost his patience. His number called as ready for collection long ago he had watched as his item moved from dispatch hatch to shelf and then seemingly to literal limbo.Argos counter anxiety

His way of ‘losing it’ was interesting in that he suddenly raised both arms skyward with one hand still clutching his item ticket and proclaiming his ‘love of God’ utterance as if attending an evangelical religious event.

His mild outburst stopped the two customer service operatives in their tracks as they were forced finally to acknowledge both the man and the overdue item. Each fixed him with a look of annoyance and disapproval. His long arms moved down to his side and the hand clutching the item ticket pointed to the item not 4 feet from him and that he could identify as his. The man’s pointed finger almost trembled with a mixture of frustration and anticipation.

He got his item and soon it was my turn to wait puzzled that my item number had long been called but couldn’t obviously be seen in my line of sight. I drifted in and out of daydreams and numb vacant stares (a speciality of mine) before finally my item had spent enough time in limbo for an operative to call my number.

I declined a bag, clutched my item and was only slightly waylaid by a poor man who seemed to walk and sway in a stilted manner akin to a drunk robot though it soon became clear that he was not drunk or otherwise intoxicated but afflicted with this method of motion as the norm. He swayed around a tower of catalogues and special offers that he seemed unable to reach out and grasp despite repeated attempts so I offered to assist in a completely non-verbal interaction  that was mutually beneficial to both parties whilst balancing my own item under one arm.

For us both the frustration was temporarily over.

Photo by cubemate under this creative commons license

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