Why have Standing Charges also increased so much with the Energy Crisis?

Can someone from OVO please come up with a sound reason as to why standing charges seem to have to increase when the fuel prices do?  Really not sure I understand why a base charge has to change in line with energy price increases!!!  Really look forward to a cohesive response.

Like i said imho your frustration is better targeted at feeding back your thoughts to ofgem regarding standing charges and the future direction of energy pricing. Or your local MP or a parliamentary petition etc. You clearly feel strongly about this. Just focus that energy somewhere it will make a difference? 

Unfortunately the standing charge has increased for many reasons. 

1. The cost of all the failed suppliers apart from Bulb has been loaded on the standing charge and front loaded rather than being spread over a very long time as some energy companies suggested. There will be more of these costs still to come unfortunately and the government could yet decide to load all the costs of Bulb onto standing charges, many billions of pounds.

2. The number of people eligible for the warm home discount has increased. These are funded via the standing charge currently. 

3. Ofgem moved some of the network related costs from the unit rate to standing charges. At the same time network related costs have increased as inflation has risen, both material costs and wages have gone up. We have all seen what has happened to inflation generally. Also we need  upgrade the infrastructure as we move to renewable energy, heat pumps and electric cars, hence again the standing charge is increasing. There have been recent changes where new generation capacity is not required to contribute to the network upgrade costs, this again will transfer costs from the unit rate to standing charges. 

These are just some examples, there are others i could give. 

The majority of standing charge has nothing to do with ovo, they are simply passing on costs from others and government schemes. 

Unfortunately there is no good news about the level of standing charge unless the government decide to shift costs to general taxation or to the unit rate which would benefit low energy users. While inflation is high, standing charges will continue to be under pressure unfortunately.

There did use to be tariff with low or no standing charge, but higher unit rates but these have long gone. For a short while there were even tariff with a fixed monthly cost irrespective of how much you used. My mum was on one of these tariff, these tariffs didn't last long for obvious reasons…

Personally i would prefer to see lower standing charges and some of the cost shifted to unit rates to benefit low energy users, but some people would be worse off obviously.

Hope that helps. I don't work for ovo, am just a customer.

@Jeffus, thank you for your time and explanation, I appreciate your contribution, which is probably far more than I would get from Ovo itself, they do have a tendency to prefer not to respond to their customers as I have found out of late, their customer service is abysmal to say the least so thank you once again for YOUR explanation 😊

@Blastoise186 wrote:

Standing Charges are ultimately a business decision for the supplier.

Obviously they are not since Ofgem sets a limit based upon regional criteria. There are probably also consumer regulations about raising a fee for one thing and charging for another, and about refusing to give a cost breakdown when asked.

Let’s not forget all I am asking here is what is included in Ovo’s Standing Charge and why did those costs increase so much in April. Ovo should know that, why will they not say?

If they can break the charge down and justify the increases that is the end of the story. Because they are refusing to do that it suggests that they are simply taking and using the Ofgem maximum and I am not sure that the Energy Ombudsman will let them away with that.

As for your “assistance” I don’t recall getting any, you just seem to be an apologist for the company. You say that you have detailed info but cannot provide links. @Jeffus at least provided correct details of where to make complaints.

A quick Google and I discovered several websites explaining that the increases in the standing charges over the past year are due to the costs of rescuing customers from failed energy companies.

There's your answer.

If you want to complain you can email OVO. Their complaints email address is on their website.

Yes, you can find in general why companies have increased the Standing Charge, but different companies have done it in different ways.

The Which website is good it states:

The standing charge you pay counts as part of the price-capped amount. It's paid in addition to the unit rate - that's the amount you pay for the energy you actually use and report through your meter.

Simply put, gas and electricity providers can't charge you more than the price cap for the combination of your standing charge and unit rate if you're on one of these tariffs.

But how they split the balance is up to them.

As a customer of OVO I want to know how OVO arrived at the Standing Charge that they are charging me.  An increase in the Standing Charge because items that legitimately should be in there have increased is fine. However if they are bumping in costs that should not be in there and are perhaps offsetting unit costs by increasing the Standing Charge, that is not okay.

Over the summer roughly half of my monthly bill was the Standing Charge, I can cut back on electricity but I cannot cut back on the Standing Charge so I very much want OVO to justify their massive increase in that charge.

Honestly why would they not? It should be simple: here is what is included and here is how those items increased this year.

Hey @AngryOVOCust,

I don’t have anything else to add here, just wanted to step in and say...

There has already been many really coherent and thorough explanations to your question about increased standing charges by our Community Members. All information on this topic can be found on the OFGEM website. The market regulator increased the threshold for the standing charges due to the reasons already stated by other Forum Members. 

@Emmanuelle_OVO

As you say you are not adding anything. There are plenty of people out there angry about Standing Charges and all I am asking from Ovo is a justification for the charge that they have levied. These differ from supplier to supplier so there is no point in referencing general information on the internet.

I am not a legal person so I don’t know if this applies but it has been pointed out to me that the Gas 1986 and Electricity 1989 Act's state the following -

Condition 0. Treating Domestic Customers Fairly -
0.3 The Standards of Conduct are that the licensee and any Representative:
a) behave and carry out any actions in a Fair, honest, transparent, appropriate and
professional manner;
b) provide information (whether in writing or orally) to each Domestic Customer
which:
i. is complete, accurate and not misleading (in terms of the information provided or omitted);

If asked OVO should be providing information on how OVOs  Standing Charge is calculated.

As one part of a formal complaint to OVO I have asked for a breakdown of its Standing Charge and how each element varied in April 2022. OVO have simply not replied to any part of my complaint including the Standing Charge question. As a result the complaint will eventually work its way to the Energy Ombudsman.

To try and gee things up, my complaint has been rumbling on for a year, I emailed the OVO CEO Stephen Fitzpatrick. Emails to him are of course intercepted and what you get back is a bland message from *Edited by Mod* Ovo Groups Senior Executive Complaints Manager, promising to get something done. All that results in is somebody else coming back who clearly has not read the complaint and tries to shut the complaint number down.

Customer Service at Ovo in non-existent. They have a call centre, email help addresses etc. but there appears to be absolutely nothing behind that to address actual problems. All that happens is they bounce problems from person to person continually raising and losing complaint numbers but never actually addressing the problem.

The time and effort wasted by this dysfunctional service is chronic. If Ovo want to raise your Direct Debit but you want to keep it the same you have to phone the Call Centre, with lengthy waits. When you get through they will tell you that they are not allowed to put accounts on the 3 month exemption list for DD increases any more. Repeat this process 4 or 5 times wasting a huge amount of telephone time and they will freeze your DD. Why not do it the first time? Why not give a breakdown of Standing Charge elements when one is asked for? Why not actually fix the problem that is preventing monthly bills being sent out instead of just sitting on it?

Hi @AngryOVOCust what date did you raise your complaint?

You simply have to wait 8 weeks, then if you haven't had a reply simply go straight to the Energy Ombudsman, no point waiting, and wait for them to make a ruling on what OVO are obliged to supply you. 

Then post the ombudsman reply here as i am sure it will help others whatever it says. 

Good luck.