North Wales households will see biggest increase in some energy bill charges

News and Info from Deeside, Flintshire, North Wales

This article is old - Published: Monday, Mar 28th, 2022

Standing charges for people in North Wales on standard electricity bills are set to more than double.

Next month’s 54% energy price cap increase means 22 million people will see higher energy payments on 1 April.

Ofgem introduced an ‘energy price cap’ in Great Britain in January 2019 following concerns that many people, particularly those who did not switch supplier to find cheaper deals, were paying too much for their energy.

The cap is reviewed twice a year, in April and October.

On 3 February, Ofgem announced that the cap will increase from 1 April 2022 for approximately 22 million customers.

The cap limits the amount that a supplier can charge for their default tariff. It includes:

The standing charge – a fixed daily amount you have to pay for energy, regardless of how much energy you use.

The price for each unit of electricity and gas – measured in pence per kilowatt hours, or p/kWh.

Those on default tariffs paying by direct debit will see an increase of nearly £700 to just short of £2000, prepayment customers will see an increase of £708.

The increase is driven by a record rise in global energy prices over the last 6 months, with wholesale prices quadrupling in the last year.

Consumers will see a big increase in electricity standing charges and households in North Wales are set to be hit harder than anywhere else in Britain.

How much people pay in standing charges depends on each energy supplier and which part of the country people live.

Standing charge costs include using and maintaining the energy networks, wires and pipes that carry gas and electricity across the country to households.

They also cover keeping homes connected to the energy network, carrying out meter readings and payments towards government initiatives that help vulnerable households and reduce CO2 emissions.

Research by the BBC has found that the standing charge – Single Rate Electricity Meter – from April 1st in North Wales will increase by 23p to 45p per day.

The rise represents an increase of 102% – the highest of any region in Wales, Scotland and England – and will add a further £80 to bills on top of the hike in price per unit of electricity.

Source: Ofgem/BBC

Analysts told the BBC that “local distributors and suppliers are moving charges which were once part of a consumer’s unit price for energy (which now has a tight upper limit on it) over to their standing charge.”

“They are also increasing standing charges to the maximum level for each region, which means a big jump for some places.”

BBC consumer affairs correspondent Colletta Smith said: “Standing charges are certainly not the biggest part of your energy bill, and they are dwarfed by the massive increases in the unit price for the energy you use.”

“But in normal circumstances, an extra £80 a year on your energy bill just from standing charges would not go unnoticed, especially as in some areas they are increasing by a lot more than others. So is something fishy going on?”

“Ofgem assures me that the extra costs for failed energy companies are being spread equally across the country.”

“But the Energy Networks Association say that no major network developments have happened in any areas in the last six months that would explain the regional divisions.”

“Local distributors and suppliers are moving charges which were once part of your unit price, which now has a tight price cap on it, and shifting them across to your standing charge.”

“Most suppliers are upping their standing charges to the maximum level for each region, which means a big jump for some places, adding insult to the injury of a whopping energy bill.”