Author Topic: Peoples Energy: any experiences and/or knowledge of this supplier please?  (Read 10799 times)

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #50 on: 19 September, 2021, 08:56:19 am »
Energy prices are the hot (!) topic in the papers . . .  but something that confuses me is the "price cap" - which I think is that an energy supplier is not permitted to charge in a 12 month period more than a fixed amount to a consumer on a "standard variable tariff" - I think it's about £1,200.

Our supply is with British Gas for both fuels on a fixed rate until February 2022 - with the likely annual amount being close to what I think is the cap value.

Looking sideways at the cap limit etc - if a consumer has a massive mansion and is consuming a vast amout of gas and electricity but opts for a "standard variable tariff" they would have a cap on their annual cost?

I'm sure I'm missing something here - but I would like enlightenment.

--
Widening this slightly I really find it hard to understand that there can be any benefits in "utility competition" as against them being state-run - for energy, water, phone, railways . . .  with duplicaton, waste and the fat-cat director factors.    I'm old enough to remember when there were just regional gas, electricity, water providers, GPO for phones and British Railways - seemed to work OK?

Firstly, Avro is one of the ones on the list but haven’t gone yet.

On price capping the cap is a tariff that equates to £1,200 pa for an average consumer.   If you have a bigger consumption then you pay the same tariff but spend more.

There’s an upcoming issue.   The cap is set in advance of the season and goes up 1st Oct.  Wholesale prices have gone up so much that the cap is now a loss making deal at a gross level for existing suppliers.   Can you think of another industry where you are forced to supply a loss making customer ?

My fix runs out in January and I had a look at Uswitch this morning.  There were only 5 quotes and the cheapest quote was an 800 quid increase pa.

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #51 on: 19 September, 2021, 08:58:52 am »
The Ofgem "safety net" is nothing of the sort.  You get tossed to one of the Big Five who will not honour your current tariff.

Forecast cost of Supplier of Last Resort for this Winter is looking like £1bn.  All this cost is collected back through a levy on energy supply so we cover the costs.

Jaded

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Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #52 on: 19 September, 2021, 08:59:49 am »
Thr Royal Mail is another example of private business getting access to the cream of the business, whilst the original organisation still has a requirement to deliver to the most difficult places.
If you don't like your democracy, vote against it.

robgul

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Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #53 on: 19 September, 2021, 09:10:53 am »
Energy prices are the hot (!) topic in the papers . . .  but something that confuses me is the "price cap" - which I think is that an energy supplier is not permitted to charge in a 12 month period more than a fixed amount to a consumer on a "standard variable tariff" - I think it's about £1,200.

Our supply is with British Gas for both fuels on a fixed rate until February 2022 - with the likely annual amount being close to what I think is the cap value.

Looking sideways at the cap limit etc - if a consumer has a massive mansion and is consuming a vast amout of gas and electricity but opts for a "standard variable tariff" they would have a cap on their annual cost?

I'm sure I'm missing something here - but I would like enlightenment.

--
Widening this slightly I really find it hard to understand that there can be any benefits in "utility competition" as against them being state-run - for energy, water, phone, railways . . .  with duplicaton, waste and the fat-cat director factors.    I'm old enough to remember when there were just regional gas, electricity, water providers, GPO for phones and British Railways - seemed to work OK?

Firstly, Avro is one of the ones on the list but haven’t gone yet.

On price capping the cap is a tariff that equates to £1,200 pa for an average consumer.   If you have a bigger consumption then you pay the same tariff but spend more.

There’s an upcoming issue.   The cap is set in advance of the season and goes up 1st Oct.  Wholesale prices have gone up so much that the cap is now a loss making deal at a gross level for existing suppliers.   Can you think of another industry where you are forced to supply a loss making customer ?

My fix runs out in January and I had a look at Uswitch this morning.  There were only 5 quotes and the cheapest quote was an 800 quid increase pa.

Apologies if I'm being dumb here .... what constitutes an "average consumer" that enjoys the price cap?   Is it an amount of Kwh of each, supplied effectively regardless of the unit/standing charge prices - just an annual maximim payable?

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #54 on: 19 September, 2021, 09:42:31 am »
Energy prices are the hot (!) topic in the papers . . .  but something that confuses me is the "price cap" - which I think is that an energy supplier is not permitted to charge in a 12 month period more than a fixed amount to a consumer on a "standard variable tariff" - I think it's about £1,200.

Our supply is with British Gas for both fuels on a fixed rate until February 2022 - with the likely annual amount being close to what I think is the cap value.

Looking sideways at the cap limit etc - if a consumer has a massive mansion and is consuming a vast amout of gas and electricity but opts for a "standard variable tariff" they would have a cap on their annual cost?

I'm sure I'm missing something here - but I would like enlightenment.

--
Widening this slightly I really find it hard to understand that there can be any benefits in "utility competition" as against them being state-run - for energy, water, phone, railways . . .  with duplicaton, waste and the fat-cat director factors.    I'm old enough to remember when there were just regional gas, electricity, water providers, GPO for phones and British Railways - seemed to work OK?

Firstly, Avro is one of the ones on the list but haven’t gone yet.

On price capping the cap is a tariff that equates to £1,200 pa for an average consumer.   If you have a bigger consumption then you pay the same tariff but spend more.

There’s an upcoming issue.   The cap is set in advance of the season and goes up 1st Oct.  Wholesale prices have gone up so much that the cap is now a loss making deal at a gross level for existing suppliers.   Can you think of another industry where you are forced to supply a loss making customer ?

My fix runs out in January and I had a look at Uswitch this morning.  There were only 5 quotes and the cheapest quote was an 800 quid increase pa.

Apologies if I'm being dumb here .... what constitutes an "average consumer" that enjoys the price cap?   Is it an amount of Kwh of each, supplied effectively regardless of the unit/standing charge prices - just an annual maximim payable?

All consumers have the benefit of the price cap.  It’s something like 3,000kWh electricity and 10,000kWh of gas.  For this usage you’d pay £1,200 a year.  If you use more you pay more £s but the same implied tariff.

robgul

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Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #55 on: 19 September, 2021, 09:51:22 am »
Energy prices are the hot (!) topic in the papers . . .  but something that confuses me is the "price cap" - which I think is that an energy supplier is not permitted to charge in a 12 month period more than a fixed amount to a consumer on a "standard variable tariff" - I think it's about £1,200.

Our supply is with British Gas for both fuels on a fixed rate until February 2022 - with the likely annual amount being close to what I think is the cap value.

Looking sideways at the cap limit etc - if a consumer has a massive mansion and is consuming a vast amout of gas and electricity but opts for a "standard variable tariff" they would have a cap on their annual cost?

I'm sure I'm missing something here - but I would like enlightenment.

--
Widening this slightly I really find it hard to understand that there can be any benefits in "utility competition" as against them being state-run - for energy, water, phone, railways . . .  with duplicaton, waste and the fat-cat director factors.    I'm old enough to remember when there were just regional gas, electricity, water providers, GPO for phones and British Railways - seemed to work OK?

Firstly, Avro is one of the ones on the list but haven’t gone yet.

On price capping the cap is a tariff that equates to £1,200 pa for an average consumer.   If you have a bigger consumption then you pay the same tariff but spend more.

There’s an upcoming issue.   The cap is set in advance of the season and goes up 1st Oct.  Wholesale prices have gone up so much that the cap is now a loss making deal at a gross level for existing suppliers.   Can you think of another industry where you are forced to supply a loss making customer ?

My fix runs out in January and I had a look at Uswitch this morning.  There were only 5 quotes and the cheapest quote was an 800 quid increase pa.

Apologies if I'm being dumb here .... what constitutes an "average consumer" that enjoys the price cap?   Is it an amount of Kwh of each, supplied effectively regardless of the unit/standing charge prices - just an annual maximim payable?

All consumers have the benefit of the price cap.  It’s something like 3,000kWh electricity and 10,000kWh of gas.  For this usage you’d pay £1,200 a year.  If you use more you pay more £s but the same implied tariff.

Thanks - that now makes sense!


. .  . I stumbled across this https://www.youtube.com/watch?v=47jr-0-oUfw  which is somewhat revealing - and that AVRO is under "special reporting measures" from OFGEM.   

Our experience in a nutshell - moved to a house supplied by AVRO - tried to move away but thwarted by lack of comunication, and they didn't read meters or want readings submitted for months - finally went to Ombudsam who ruled in our favour with compenastion.   The one thing that was good is that as they failed on the paper-work we never set up a DD - I just calculated our due amount from my meter readings at the correct tarrif and paid them by cheque - so we weren't victim of the DD grabbing/raising that features in the reviews.  Moved to BG in Feb 21 (at much cheaper than AVRO's "best" rate) - still getting "bills and other crap" from AVRO.

Digging around Companies House records it seems that the 27 year old MD and, I assume, his father have fingers in several other businesses.

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #56 on: 19 September, 2021, 02:59:17 pm »
It’s understandable.  Alok Sharma was on the news this morning saying energy costs were capped at 1200 quid which isn’t entirely accurate.   The presenter quite rightly said suppliers will go bust at the cap.

Avro have only just been placed under special orders which is frankly a bit late as I think they are done.

As an aside I spotted coming into Stevenage on Phil Ws rather excellent 100k yesterday that they were playing Forest Green.

Jaded

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Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #57 on: 19 September, 2021, 04:00:51 pm »
Stevenage lost 0-4

Ecotricity’s main sponsorship doing them proud. Top of League Two The Fourth Division
If you don't like your democracy, vote against it.

ian

  • not a woman, not an american, not a vampire
Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #58 on: 19 September, 2021, 05:32:46 pm »
Looking at alternatives to BG's standard variable tariffs a few weeks back, prices were not much different other than a few outliers (which it seems aren't around anymore).

I've no issues with competition in markets where there is real competition, but this is basically pretend competition, at best they may do a better job of hedging wholesale supply rates and pushing up their margin a little by shaving off any people costs and replacing support with a chatbot), but once they miscalculate, we all end up picking up the bill.
Authoritarian Thought Leader, the Pol Pot of Powerpoint, the Stalin of Spreadsheets

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #59 on: 19 September, 2021, 06:58:09 pm »
They're just middlemen taking their slice.  Pointless if they can't even hedge properly.
And Darkness and Decay and the Coronavirus held illimitable dominion over all.

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #60 on: 20 September, 2021, 07:57:18 am »
This from a contact of mine on Linkedin :-

When hedging is in the news then things are bad. Hedging should be boring 🤓There is a lot of nonsense going about at the moment, so an explainer*

Hedging is hard. It involves making balanced trade-offs between competing risks and there is no one-size-fits-all solution.

At its most basic level, hedging for energy supply is straightforward - you buy energy for fixed priced customers at the point of sale and for capped customers during the pricing-in window.

But how much do you buy? Do you buy for customers who leave you and customers you will acquire? How many customers will take your standard variable tariff compared to a new fixed tariff? You have to estimate that about a year in advance to get the cap hedge right.

In a world where fixed prices are *double* the commodity cost allowed under the cap, any estimates you made are now wrong.

How much energy are your customers going to use and when? Do you hedge to seasonal normal demand - and face the normal warm-weather risk of having to sell back loss making hedges?

It turns out that when *summer* gas prices are 180p/th all your assumptions were wrong.

The products to hedge evening peak power are not normally available until the day before supply - when they hit £4,000/MWh any premium you included in pricing was wrong.

Hedging costs money. If you were to insure yourself against unthinkable price movements you would spend more than the regulator allows you to recover in profit.

Hedging also benefits players with scale - the balance sheet to hedge forwards more than a year in advance and cover any MtM margin calls. The basis risk inherent in the price cap requires you to be able to see through periods of losses even if you hedge effectively.

When volatility increases you tend to find that liquidity decreases, further limiting your options. This is especially so for small suppliers whose counterparties will all be tightening credit terms.

So anyone who blithely tells you that companies who hedged ‘correctly’ will be fine is talking rubbish. These are unprecedented market movements where previously manageable risks are now a threat to survival.

*these are all generic points so please don’t try to make any inferences about the positions of my current or former employers

ian

  • not a woman, not an american, not a vampire
Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #61 on: 20 September, 2021, 10:13:14 am »
So what are the requirements to set yourself up as an energy supplier – some of them seem very sketchy, no real assets or organization, just an ability to negotiate a few supply contracts, fill in the forms for the suppliers, and set up some billing tools? The risks seem minimal, other than going bust, but they don't seem to have any assets to lose.

It all seems a bit little league Enron. The only benefits seem to be a small number of customers who routinely flip between deals and are lucky enough with any contract periods, but at the end of that day, since wholesale prices are what they are, realistically, those savings will come back as future costs across all suppliers.
Authoritarian Thought Leader, the Pol Pot of Powerpoint, the Stalin of Spreadsheets

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #62 on: 20 September, 2021, 10:46:35 am »
Entry requirements used to be minimal and a couple of companies started pre-registering entities using what they called 'supplier in a box'.   The failures you are seeing at the moment are ones that went down that route.   A couple of years back there were some failures and Ofgem increased the market entry requirements.   Bit late.   As an existing supplier you have to provide quarterly reporting on your financial situation and hedging programme.

The wholesale market had consistently delivered low so you could get a natural short position through selling to consumers and not hedging.  Your upside is reasonable and it's only a year ago we had single digit and negative pricing in the UK.   Unfortunately when it goes the other way you lose your shirt and possibly take others down on the way.

ian

  • not a woman, not an american, not a vampire
Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #63 on: 20 September, 2021, 11:05:58 am »
Creating a marketplace of energy suppliers based on consistently favourable wholesale pricing seems, to put it politely, short-sighted.
Authoritarian Thought Leader, the Pol Pot of Powerpoint, the Stalin of Spreadsheets

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #64 on: 20 September, 2021, 11:19:06 am »
Creating a marketplace of energy suppliers based on consistently favourable wholesale pricing seems, to put it politely, short-sighted.

That probably does some well run companies a disservice, but companies that survive the next couple of months will not be remembered.

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #65 on: 20 September, 2021, 11:24:37 am »
If only there were a large stable entity with big - nay, infinite - cash reserves to ride out short term fluctuations in wholesale prices there’d be no need for any of this.

ian

  • not a woman, not an american, not a vampire
Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #66 on: 20 September, 2021, 11:28:17 am »
Creating a marketplace of energy suppliers based on consistently favourable wholesale pricing seems, to put it politely, short-sighted.

That probably does some well run companies a disservice, but companies that survive the next couple of months will not be remembered.

I'm not necessarily blaming those companies, more those responsible for creating the marketplace in the first place, and setting the low entry standards for suppliers. This seems a very likely outcome (and of course, we know who will pick up any bills – consumers and taxpayers, not the companies who have failed).

Ultimately, I still struggle to see how this system was supposed to – other than in short term scenarios – benefit consumers.
Authoritarian Thought Leader, the Pol Pot of Powerpoint, the Stalin of Spreadsheets

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #67 on: 20 September, 2021, 12:19:45 pm »
It's quite appropriate that a thatcherite is in the hot seat whilst the downside of rampant national asset-stripping and profiteering becomes vulnerable to their own ultimate nirvana of competitive market forces.  No doubt the right wing press will blame Labour, France or the EU in general.

There is likely to be millions of customers, us in the Bear-o-drome included who are about to be shifted to another supplier and subject to a huge hike in our fuel bills.  We can ride that wave fortunately but for the millions on minimum or low wage seeing their UC being reduced, their grocery bills creeping up and their NI increasing to pay for the care of the either comfortable or profligate generation, this is going to be crushing.

robgul

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Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #68 on: 20 September, 2021, 01:02:00 pm »
If only there were a large stable entity with big - nay, infinite - cash reserves to ride out short term fluctuations in wholesale prices there’d be no need for any of this.

I think that could be a "government entity" . . .  as was prior to Sid and his share dealing profits.

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #69 on: 20 September, 2021, 02:54:29 pm »
Creating a marketplace of energy suppliers based on consistently favourable wholesale pricing seems, to put it politely, short-sighted.

That probably does some well run companies a disservice, but companies that survive the next couple of months will not be remembered.

I'm not necessarily blaming those companies, more those responsible for creating the marketplace in the first place, and setting the low entry standards for suppliers. This seems a very likely outcome (and of course, we know who will pick up any bills – consumers and taxpayers, not the companies who have failed).

Ultimately, I still struggle to see how this system was supposed to – other than in short term scenarios – benefit consumers.

Privatisation was never intended to benefit the customer but many were dumb enough to believe the lies.  Hmmm, a similar scenario to berxit: I wonder which political faction was in power for both of these extreme examples of greed and corruption for the benefit of the elite?

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #70 on: 21 September, 2021, 12:05:10 am »
Another four smaller suppliers are expected to go bust imminently as they can't afford to supply gas at the prices customers have paid.  It really is a shitshow.  I blame Thatcher.  Tell Sid he's a grifting capitalist bastard.

I'm hoping that one the candidates is AVRO after our experience with them . . .  it seems that reviews are now almost all 1star with dire customer service and potential illegal witholding of funds to be returned etc (the older reviews looked as if they cam from the same hand . . . ? AVRO themsleves?)

We're with AVRO, so that'd be good...  ;) 

No issues for 2+yrs, so far.  Have seen this...


Quote
On the 19th August 2021, Ofgem requested information from Avro Energy. They failed to comply with this request and so Ofgem issued a Provisional Order on the 14th September which compelled them to provide this information immediately.

There has been no public response from Avro Energy so far and this request from Ofgem alone does not mean they are going bust.

It is estimated that Avro has ~600,000 electricity customers, so if they were to go bust this would be one of the biggest suppliers to go out of business in recent years.
https://www.energy-review.co.uk/guides/which-energy-suppliers-are-going-bust/
"Perhaps we cannot raise the winds. But each of us can put up the sail, so that when the wind comes we can catch it." EF.S

"Perhaps we cannot raise the winds. But each of us can put up the sail, so that when the wind comes we can catch it." EF.S

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #72 on: 21 September, 2021, 06:28:21 am »
Burning gas for power generation was always squandering a finite resource, too useful for domestic heating (and as a chemical feedstock).  When I was growing up, it wasn't really a thing - power was from coal (we are still sitting on 250 years' supply in the UK alone) or nuclear.

The realisation of anthropogenic global warming has made coal unacceptable, but the "dash for gas" was actually done for economic reasons, not environmental.  The only big issue with coal plants in the late 80s was acid rain, eventually addressed with FGD scrubbers* 

With hindsight, we should have gone straight to renewable and nuclear from coal, and ignored gas.  Most of the UK's carbon reduction over the laat decade was due to a switch from coal to gas, which doesn't look too clever now.

*which supplied a large proportion of gypsum for plasterboard, now more expensive as the supply reduces
And Darkness and Decay and the Coronavirus held illimitable dominion over all.

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #73 on: 21 September, 2021, 06:35:06 am »
This from a contact of mine on Linkedin :-

When hedging is in the news then things are bad. Hedging should be boring 🤓There is a lot of nonsense going about at the moment, so an explainer*

Hedging is hard. It involves making balanced trade-offs between competing risks and there is no one-size-fits-all solution.

At its most basic level, hedging for energy supply is straightforward - you buy energy for fixed priced customers at the point of sale and for capped customers during the pricing-in window.

But how much do you buy? Do you buy for customers who leave you and customers you will acquire? How many customers will take your standard variable tariff compared to a new fixed tariff? You have to estimate that about a year in advance to get the cap hedge right.

In a world where fixed prices are *double* the commodity cost allowed under the cap, any estimates you made are now wrong.

How much energy are your customers going to use and when? Do you hedge to seasonal normal demand - and face the normal warm-weather risk of having to sell back loss making hedges?

It turns out that when *summer* gas prices are 180p/th all your assumptions were wrong.

The products to hedge evening peak power are not normally available until the day before supply - when they hit £4,000/MWh any premium you included in pricing was wrong.

Hedging costs money. If you were to insure yourself against unthinkable price movements you would spend more than the regulator allows you to recover in profit.

Hedging also benefits players with scale - the balance sheet to hedge forwards more than a year in advance and cover any MtM margin calls. The basis risk inherent in the price cap requires you to be able to see through periods of losses even if you hedge effectively.

When volatility increases you tend to find that liquidity decreases, further limiting your options. This is especially so for small suppliers whose counterparties will all be tightening credit terms.

So anyone who blithely tells you that companies who hedged ‘correctly’ will be fine is talking rubbish. These are unprecedented market movements where previously manageable risks are now a threat to survival.

*these are all generic points so please don’t try to make any inferences about the positions of my current or former employers
Yep, hedging is difficult.  My employer does it against interest rates*.  It takes a lot of predictive modelling and, as you say, customer behaviour is the hardest one to call.  Unlike the energy firms, however, the regulator requires us to be hedged - we can't just take the risk.

*before you say "but they haven't changed much for a decade", we're talking about interbank rates here, not the Bank of England MLR.
And Darkness and Decay and the Coronavirus held illimitable dominion over all.

Re: Peoples Energy: any experiences and/or knowledge of this supplier please?
« Reply #74 on: 21 September, 2021, 08:10:33 am »
Am I right in thinking that direct debits may not be the way to pay, if an energy supplier is going to be setting a very high monthly payment, based on projections, and one has a fair latitude to cut down on energy use in the home...
"Perhaps we cannot raise the winds. But each of us can put up the sail, so that when the wind comes we can catch it." EF.S