Got a question for Gov't energy and climate change secretary, Ed Davey?

A question about : Got a question for Gov't energy and climate change secretary, Ed Davey?

Hi all,

Next Wed 4 March, Ed Davey, the Secretary of State for energy and climate change is coming to MSE Towers to make a policy speech and announcement, and be questioned by us, other press and energy industry campaigners.

As part of that we have arranged that some MoneySaver's questions can be put to him (as chosen by us, don't worry this won't be soft soap).

So if you have a point about gas & electicity switching, or the consumer energy market that you'd like us to ask him about, please reply below.

Alternatively you can email askeddavey@moneysavingexpert.com or tweet us @MoneySavingExp with the #AskEdDavey.

We will be recording the session and answers and will ensure they're put on the site one way or another (we're still working out the exact format of that).

Ask away folks!

MSE Martin

Best answers:

• Yes - when you came to open the new BGB office in Oxford, why did you not take up my offer "to take you for a beer and tell you what's really wrong with this industry"
  Most people would clamour for such an opportunity
• Energy price comparison rules.
  The way these rules are set up means that it is impossible to get an accurate comparison because of all the assumptions that are made.
  For example - they assume that after my current deal ends, I will transfer to the suppliers variable (expensive) tariff. As a money saving convert, I would never do this (unless it suited me to do so). This means that the comparison saving shown is always inaccurate.
  I want to be able to easily compare price per kWh and standing charges.
• Is OFGEM fit for purpose?
• I have plenty. I will start with these
  1) We are now in a situation in this country where all major power generation types are subsidised - renewables are subsidised, the new nuclear projects have been guaranteed a minimum price by the government, and now gas and power are subsidised through the capacity auction. This is absurd, and politicians from all sides talking about prices simply ignores the fact that the taxpayer only pays for part of their energy at the point of use, with the remainder being extracted through taxes. All of this makes the situation very unclear. What are you planning to do to change this?
  2) From the experience that I have of OFGEM, they are seem to have a lack of understanding of the industry that they are meant to regulate. Is anything going to be done to make them something more than a passive and somewhat clueless observer to a rapidly evolving industry?
• My question for Ed, which is probably already planned anyway:
  What can the government do (assuming he is in power after May) to force the energy providers to cut prices proportionately when their wholesale prices fall, in a similar speed to that they raise prices when wholesale prices rise.
  Some of us have long memories and remember who quickly energy providers quickly raided their prices by 30% in 2008
  https://blog.moneysavingexpert.com/20...e-predictions/
  The energy companies at the time said it was vital to increase prices to protect margins.
  But now the argument is that energy companies by years in advance so cannot drop prices today.
  Even if I were to believe that current excuse (which I don't entirely), then why can't the energy companies tell us that prices will fall in 2 years time, or whatever timeframe they claim to now buy ahead, reflecting the prices they are presumably buying at today for the future (assuming no other forced changes are applied to tariffs, such as possible government levies)?
  Centrica have recently announced a drop of 35% in profits, and substantial cost saving measures as a result (including dividend cuts), due to the lower wholesale prices ... so who are they selling to at the lower price if not our suppliers (for either today or some time in the future)?
  So can the government not bring in powers for Ofgem (or some other empowered organisation) to force suppliers to charge fair prices?
  The market is not working fully at present, especially amongst the big 6, perhaps because of the general inertia of customers to switch to a better deal.
  And I would suggest the smaller suppliers are also raking it in too, playing the same game. What I have noticed over recent times when costs have been reduced very slightly, is that as soon as the small suppliers (who have no huge number of legacy customers to earn from) are no longer competitive, they soon reduce their prices ... so demonstrating there must be room for lowering prices.
  Another area I think the market is broken is based on recent reports that those who do not regularly switch are spending a collective Ј2.7 billion a year more than they need to
  (based on average savings per customer of between Ј158 to Ј234 a year)
  But does anyone really believe the industry would willingly cut their turnover by Ј2.7 billion in the unlikely event everyone did suddenly start switching?
  Of course not.
  In reality, what is currently happening is that may of us MSE'ers who do actively switch to the lowest possible tariffs are being supported by those who fail to switch and so effectively overpay.
  So if everyone did start switching, yes the industry will suffer some of the pain, but so will us MSE'ers who take advantage of the best possible tariffs as they too would quickly be withdrawn to stem the loss of revenue.
  So what can the government do there to help competition, as encouraging more and more to switch cannot alone be the answer as it will not give everyone the savings currently boasted of ... as they will no longer be available.
• What are you doing to reduce our domestic energy consumption? ECO, GDHIF et al are nowhere near ambitious enough.
• As to Ed Davey: why should the burden of expensive low-usage households be forced upon one or two suppliers and tariffs (instead of, before the banning of two-tier tariffs, be shared across them all.)
  Why make vulnerable, innumerate customers be the only ones to subsidise low-usage households?
  And what happens when more suppliers withdraw from such provision - npower have now withdrawn. When its current fixes end I am likely to be left with only one provider across the whole market.
• Why did you support or require the OFGEM retail market review? The intent was apparantley to make it easier to compare tariffs, but it did not make it easier to compare and in addition made many users energy costs increase, often by a huge percentage.
  For example under the old system, many tariffs had a 0 standing charge and two unit rates. This has now been changed to a standing charge and a single unit rate. However because the standing charge can vary by a large amount, anyone wanting to compare still has two things to compare, the standing charge and the unit rate, compared to having to compare two unit rates previously. To work out the best tariff is therefore still complex because you need to know expected consumption to work out if it's better to be on a tariff with a low unit rate and a high standing charge or vice-versa.
  If the intention was to make it easier to compare tariffs then we should have either:-
  1. A standardised standing charge across all suppliers and a single unit rate.
  2. No standing charge and a single unit rate.
  Only then could direct comparisons between tariffs be made easily. The Tariff Comparison Rate (TCR) is a fudge to attempt to make it easier to compare tariffs, but because it is based on some "average" usage, it can be very wrong for customers not using the average amount.
  In addition the changes have meant virtually all "no standing charge" tariffs have been abolished. As a result low users now find themselves paying a lot more in many case. There is now just a single supplier (Ebico) offering such a Gas tariff, removing any competition from the market which is required in a healthy market.
• Why do MPs and committee members waste time moaning about such a non-issue as commission charges between suppliers and comparison sites and agents? The consumer doesn't care and doesn't need to know. Why on earth should the comparison tables include that additional information? If consumers can't handle two-tier tariffs...
  Yes, consumers have to learn that comparison sites can be used only for comparisons and have to know they can check if a cashback site will share some of the commission with them. But to waste so much committee time on such an inconsequential brouhaha is silly.
• What exactly do OFGEM do? What have they delivered?
  Since we as the taxpayer fund them, and we fund them again through our utility bills when they demand information from the utility companies, which involve manhours and IT effort to produce, which of course needs to be paid for somehow...I'd LOVE to see how much they have cost the big six over the last few years
• Why is the Green Deal so complicated to use? Can the government simplify things because the feedback on this forum has been very critical?
• Can we be given the actual and projected cost of the subsidies for renewable energy - FIT, RHI etc
  What proportion of those costs fall on consumers and what proportion on the Exchequer.
• My question's to Mr Davey would be,
  1, Why don't the government spell out to the public that in comparison to most other EU countries our prices are actually very competitive?
  2. When are we going to get an investigation into the dealings of comparison websites and clear information on how much such companies make in profit via churn?
• Wow, to think he not only manages to answer these questions prior to his arrival. He even manages to answer the questions using other memberships.