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Regulator adds £28 per year to our bills ?

  • 1 April 2024
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Buzby
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  • Buzby
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From the BBC website, https://www.bbc.co.uk/news/business-58090533

“ The regulator is also adding £28 to everyone's bill over the year to cover the cost of dealing with £3.1bn of debt that customers owe to suppliers. “

What ?.

Imagine I own a business, say a plumbers or car dealership.

If one of my customers fails to pay his bill, can I get the Government to force all my other customers to pay for my inability to recover my loss ?.

In fact, it’s even better than that. The Government is getting all my competitor’s customers to chip in as well !.

What is going on ?

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Best answer by Firedog 1 April 2024, 15:27

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I burn gas, petrol, and diesel. I am 100% Carbon Neutral ( Well, I will be, when I can buy some carbon offsets.. )

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Blastoise186
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That’s not the full story. Some other allowances also ended at the same time, so the net result is actually more like £11.

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Buzby
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It doesn’t matter what the actual amount is, it’s the principle that I want to understand.

Why am I legally obliged to pay for the supplier’s inability to collect his own debts ?

I burn gas, petrol, and diesel. I am 100% Carbon Neutral ( Well, I will be, when I can buy some carbon offsets.. )
Blastoise186
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That's a question for Ofgem 

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Firedog
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If one of my customers fails to pay his bill, can I get the Government to force all my other customers to pay for my inability to recover my loss ?.

 

No, but traders in a free market are used to losses like payment default and shoplifting. They just hike their prices up to cover them.

Energy suppliers can’t do this, because the prices they can charge are capped by decree. There’s £3Bn of debt currently owing to suppliers, who have no way of covering it. What would you suggest?

You can read all about Ofgem’s reasoning here: Price cap – Additional debt related costs review decision (ofgem.gov.uk).

 

Noel | I have no official status; I'm just a volunteer who comes here to help other customers. My gear: Aclara SGM 1416-B Electricity-only E7 meter; Chameleon IHD3-PPMID-AAA
Buzby
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I’ve not read the full document, but have read enough to see how the results are calculated, and it stinks !

It is true that traders in a free market can hike prices at will, but they then take the risk of pricing themselves out of the market. They have to weigh the pros and cons of their actions.

For energy suppliers it is different, as they can’t hike prices.  However, why should decent customers be forced to foot the bill for debtors ?.

Quite often when I pay by card in a shop, there is a ‘charity option’ on the machine. It is up to me whether I want to fund that charity or not.

I’ve never seen an option to fund the owner’s gambling debts.

I burn gas, petrol, and diesel. I am 100% Carbon Neutral ( Well, I will be, when I can buy some carbon offsets.. )

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