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Energy tariffs

...on serious topics that don't fit anywhere else at present.
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Alan H
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Energy tariffs

#1 Postby Alan H » October 18th, 2012, 7:16 pm

What's all this about 'Call me Dave' Cameron legislating to force energy companies to give their customers the lowest tariff, rather then leaving them with the 'choice' of choosing one out of the myriad of tariffs they currently offer (all designed to confuse us, of course)?
Alan Henness

There are three fundamental questions for anyone advocating Brexit:

1. What, precisely, are the significant and tangible benefits of leaving the EU?
2. What damage to the UK and its citizens is an acceptable price to pay for those benefits?
3. Which ruling of the ECJ is most persuasive of the need to leave its jurisdiction?

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Dave B
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Re: Energy tariffs

#2 Postby Dave B » October 18th, 2012, 7:40 pm

Wasn't there a similar tariff system for rail tickets once - you needed a kind tickets seller to make sure you had the cheapest option - can't remember, did they sort that out? If they did does that bode well for this?

The providers are now hinting that this may mean an averaging out of tariffs/deals so some will end up paying more. I will admit that I have found it impossible to work out, or get those trying to sell be energy to work out, how to be sure of getting a better deal on shifting.

Part of the problem is the nPower give a £100 rebate every years fro dual fuel paid via the Web -no-one else does so so I have to try to factor that into the calculations. But try asking them their price per kW and most offer so many variations it is not possible. Can't compare.

May have another go at one of the comparison websites but not sure if they factor the rebate in or work on the basic prices.

My brain hurts . . .
"Look forward; yesterday was a lesson, if you did not learn from it you wasted it."
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Nick
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Re: Energy tariffs

#3 Postby Nick » October 18th, 2012, 7:40 pm

He must have had a rush of blood to the head. Completely bonkers.

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Alan H
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Re: Energy tariffs

#4 Postby Alan H » October 18th, 2012, 7:55 pm

Dave B wrote:Wasn't there a similar tariff system for rail tickets once - you needed a kind tickets seller to make sure you had the cheapest option - can't remember, did they sort that out? If they did does that bode well for this?
I don't remember that, but at least in the days of BR things were a good bit simpler.

The providers are now hinting that this may mean an averaging out of tariffs/deals so some will end up paying more. I will admit that I have found it impossible to work out, or get those trying to sell be energy to work out, how to be sure of getting a better deal on shifting.
Undoubtedly. If they are going to make the same profits, those currently getting the lowest rates will have to pay more so that those on the higher rates pay less. Apparently, the plethora of tariffs is called 'purposeful price confusion' - an apt description, where we're given the illusion of choice. But of course, there must surely be savings from not having to maintain so many different tariffs - this saving will be passed on to the customer, of course...
Alan Henness

There are three fundamental questions for anyone advocating Brexit:

1. What, precisely, are the significant and tangible benefits of leaving the EU?
2. What damage to the UK and its citizens is an acceptable price to pay for those benefits?
3. Which ruling of the ECJ is most persuasive of the need to leave its jurisdiction?

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Fia
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Re: Energy tariffs

#5 Postby Fia » October 18th, 2012, 8:08 pm

I have neither the time nor the inclination to fart about finding who is the cheapest - easy for me to say heating home and hot water with wood right enough smug

Alan H wrote:at least in the days of BR things were a good bit simpler.
Quite. Does a Scotrail train go faster than a Virgin? :)

My youngest might have the right of it: when hearing Dave on the radio she said "He's just made that up hasn't he?"

We discussed there are many things we'd rather not have "choice" about. Electricity and gas from one supplier isn't more efficient than another is it? Water doesn't have magical properties because it's piped to us by private companies? (And why can't we just have one blooming mobile network that's joined up and works everywhere? Even everywhere within a 200 mile radius would do me...)

My youngest looked at me sadly "Who was daft enough to sell them off in the first place?... ah... Margaret Thatcher.... She left a bit of a mess didn't she?".

with apologies for the kitchen table tale but that's as far as I've got unravelling this

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Nick
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Re: Energy tariffs

#6 Postby Nick » October 18th, 2012, 8:54 pm

Oh, good grief! :headbang:

I'm too tired to explain now, but you are as wrong as Cameron on this one.

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lewist
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Re: Energy tariffs

#7 Postby lewist » October 18th, 2012, 9:42 pm

Nick wrote:Oh, good grief! :headbang:

I'm too tired to explain now, but you are as wrong as Cameron on this one.
Do you mean Margaret Thatcher, Nick? I used to be part owner of a number of large firms. They included a railway, an electricity company, a world leading company that made radioactive isotopes, and a few more. They were reset by a foreign dictatorship in the late eighties and there seems no chance of redress.

If you or I were found guilty of reset, we would serve a significant term in gaol. The woman who led this bunch of crooks was given an honour and they say she is to have a state funeral when she goes.

:angry:

You can bang on about the (dubious) economic benefits as long as you like, but being entrusted with something and then selling it is a crime, known in this country as reset and should be punished suitably.
Carpe diem. Savour every moment.

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Dave B
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Re: Energy tariffs

#8 Postby Dave B » October 18th, 2012, 9:47 pm

The impression I got was that, during the Thatcher dictatorship, we lost an awful lot of manufacturing industry to be replaced by relying on financial services bonus-grabbers - just look where that has got us!
"Look forward; yesterday was a lesson, if you did not learn from it you wasted it."
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Alan H
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Re: Energy tariffs

#9 Postby Alan H » October 18th, 2012, 10:28 pm

Which? have been campaigning on energy prices for a while. They said this yesterday, after 'Call me Dave' Cameron made his announcement:
Energy companies forced to offer cheapest tariff
Prime Minister makes a bold promise for consumers

17 October 2012

During Prime Minister's questions earlier today David Cameron promised consumers that energy companies would be forced to offer the lowest tariff to their customers.

The Prime Minister said: 'I can announce that we will be legislating so that energy companies have to give the lowest tariff to their customers.'

Cheapest energy tariffs for all customers
Which? executive director Richard Lloyd called the announcement a 'big statement' and a sign that the Prime Minister 'acknowledges that competition in the energy retail market has failed'.

He added: 'This is a big moment for consumers, but we must now see these words turned into action and see the detail from the government in the Energy Bill.'

Words must become action
Earlier today Which? sent a letter to the Prime Minister asking for an urgent, expert, independent review of the energy market.

In the last week British Gas, Scottish Power and Npower have all increased their customers' energy costs, and SSE has implemented its cost increase announced in the summer.

With the average energy bill already rising 13% since last year, consumers tell us that energy prices are one of their top financial concerns.

Keep energy prices in check
A number of companies have suggested their price rises are the result of wholesale increases, government policies and environmental schemes impacting on their costs. With a lack of transparency in the energy market it's virtually impossible to get accurate calculations of these costs.

Richard Lloyd said: 'The energy companies blame wholesale price increases but even the regulator has found that prices don't fall when the wholesale price drops. The sector is dominated by a handful of big and powerful players who are seemingly unaffected by the normal competitive pressure of price and customer service.'


Their letter to 'Call me Dave' Cameron is very interesting:
Dear Prime Minister, the energy market is broken
by Richard Lloyd, Executive Director Energy & Home 17 October 2012

Energy companies have hiked prices, but are their reasons really justified? In this letter to Prime Minister David Cameron, we call on him to commission an urgent, independent review into the energy market.

Dear Prime Minister,

Today marks the anniversary of the Energy Summit you held that promised action to help people to keep their energy bills down.

One year on, and with winter fast approaching, more than 20 million households are facing inflation-busting price rises as four of the UK’s largest energy companies put their prices up yet again.

With the average energy bill already rising 13% since last year, it is no wonder consumers tell us that energy prices are one of their top financial concerns.

After the Energy Summit, you said “we are making energy companies be competitive” but there is little evidence of this. 75% of consumers are on the most expensive tariffs and the level of switching continues to decline.

It’s time to face facts: the energy market is broken.
People are questioning whether they are paying a fair price for their gas and electricity. The energy companies blame wholesale price increases but even the regulator has found that prices don’t fall when the wholesale price drops. The sector is dominated by a handful of big and powerful players who are seemingly unaffected by the normal competitive pressure of price and customer service.

They also blame the cost of implementing your government’s environmental and social policies for the price rises. Yet, as your own Energy Department has said, there is no hard evidence to back this claim up.

Claim and counter claim are played out in the media but consumers deserve the truth. Ofgem’s proposals to change the retail energy market, expected shortly, are necessary but not enough.

Urgent, independent review into the energy market
So today we are calling on you to launch an urgent, expert, independent review into the rising cost of domestic energy bills and whether competition among energy suppliers can be made to work more effectively in the consumer interest. We want an independent review to look at whether the reasons given for the recent price increases are justified.

We also believe a review must identify what reporting measures should be required of energy companies, relating to both the wholesale and retail markets and the costs of social and environmental policies, to increase transparency and give consumers confidence that everything possible is being done to keep energy prices in check.

The review must also consider whether the regulator should now be required to better protect the majority of consumers on expensive ‘standard’ tariffs by introducing a fair cap on ‘standard’ prices.

Until we see greater transparency and prices presented clearly, consumers will continue to distrust the energy market and remain unable to drive genuine competition through moving to the cheapest tariffs.

The time for action is now. Warm words alone are not enough to keep consumers from the cold this winter.

Yours sincerely,

Richard Lloyd, Which? Executive Director
Alan Henness

There are three fundamental questions for anyone advocating Brexit:

1. What, precisely, are the significant and tangible benefits of leaving the EU?
2. What damage to the UK and its citizens is an acceptable price to pay for those benefits?
3. Which ruling of the ECJ is most persuasive of the need to leave its jurisdiction?

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lewist
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Re: Energy tariffs

#10 Postby lewist » October 18th, 2012, 10:43 pm

Spare a thought for those of us who heat our houses using oil. Now that's not cheap. There are no dual fuel discounts for us.
Carpe diem. Savour every moment.

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Dave B
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Re: Energy tariffs

#11 Postby Dave B » October 19th, 2012, 8:26 am

Yes, I have to say that you have my sympathy with regards to the way that the supplying companies seem to run both oil and (storage) gas marketing.

But did I not hear that there were moves to try to introduce more competition and less local monopoly into that situation?
"Look forward; yesterday was a lesson, if you did not learn from it you wasted it."
Me, 2015

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lewist
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Re: Energy tariffs

#12 Postby lewist » October 19th, 2012, 10:00 am

Dave B wrote:...But did I not hear that there were moves to try to introduce more competition and less local monopoly into that situation?
I believe that's right, Dave, but it's not happening fast. There are also questions about dual fuel discounts where there is no gas supply.

Price is not the only consideration. It's worth paying a bit more to the company you can be sure won't let you run out in the winter. When my house was wrecked the company I was using did just that. It didn't matter because there was no more damage to be done, but I changed suppliers and now pay by direct debit for a regular topup. It may cost more but it brings peace of mind.

It also pays to have a good boiler, efficient and reliable, which I now have... hopefully. :party:

I know people who live in places that are wonderfully beautiful and remote. They have to make sure they have a big tank and that it is filled in November.
Carpe diem. Savour every moment.

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Nick
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Re: Energy tariffs

#13 Postby Nick » October 21st, 2012, 2:24 pm

lewist wrote:
Nick wrote:Oh, good grief! :headbang:

I'm too tired to explain now, but you are as wrong as Cameron on this one.
Do you mean Margaret Thatcher, Nick?
No. We could discuss that, if you really want to, but that is entirely separate.

I used to be part owner of a number of large firms. They included a railway, an electricity company, a world leading company that made radioactive isotopes, and a few more. They were reset by a foreign dictatorship in the late eighties and there seems no chance of redress.
To claim such a thing, you need to explain how you did not receive fair value.

You can bang on about the (dubious) economic benefits as long as you like, but being entrusted with something and then selling it is a crime, known in this country as reset and should be punished suitably.
Do you think the same thing could be said of North Sea oli? Why has there not been a sovereign wealth fund established, instead of blowing it on free bus passes for all and sundry?

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Nick
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Re: Energy tariffs

#14 Postby Nick » October 21st, 2012, 2:32 pm

Alan H wrote:What's all this about 'Call me Dave' Cameron legislating to force energy companies to give their customers the lowest tariff, rather then leaving them with the 'choice' of choosing one out of the myriad of tariffs they currently offer (all designed to confuse us, of course)?

So far, it's bonkers. There are a number of things which could be done. For example, express the price in pence per unit consumed, to make comparison easier. Secondly, legislation could be introduced to make discounts for high usage unlawful, while at the same time allow a certain usage withing the standing charge. It would also be fair if the in-built subsidy to wind-farms and such-like were explicitly shown on invoices and statements.

But differential pricing is one way to persuade consumers to vary their behaviour. Eg a discount for direct debits, or avoiding peak-time consumption. These are entirely appropriate and bring savings to the consumer. Maybe it's just a mistake in presentation, but Cameron has some explaining to do.

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Nick
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Re: Energy tariffs

#15 Postby Nick » October 21st, 2012, 2:39 pm

Alan H wrote:
Dave B wrote:Wasn't there a similar tariff system for rail tickets once - you needed a kind tickets seller to make sure you had the cheapest option - can't remember, did they sort that out? If they did does that bode well for this?
I don't remember that, but at least in the days of BR things were a good bit simpler.
Simplicity, however, isn't the most important factor in running a rainway system.

The providers are now hinting that this may mean an averaging out of tariffs/deals so some will end up paying more. I will admit that I have found it impossible to work out, or get those trying to sell be energy to work out, how to be sure of getting a better deal on shifting.
Undoubtedly. If they are going to make the same profits, those currently getting the lowest rates will have to pay more so that those on the higher rates pay less. Apparently, the plethora of tariffs is called 'purposeful price confusion' - an apt description, where we're given the illusion of choice.
You might call it that, but it is meant to alter consumer behaviour to make the supply and consumption of energy more efficient. The government can, and should, encourage ease of comparison, to keep the providers on their toes. Previously, of courswe, with monopolistic suppliers, there was absolutely no incentive to do any of these things.

But of course, there must surely be savings from not having to maintain so many different tariffs - this saving will be passed on to the customer, of course...
Nope. If that were true, then the suppliers would cut the number of tariffs.

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Nick
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Re: Energy tariffs

#16 Postby Nick » October 21st, 2012, 2:43 pm

Dave B wrote:The impression I got was that, during the Thatcher dictatorship, we lost an awful lot of manufacturing industry to be replaced by relying on financial services bonus-grabbers - just look where that has got us!
A quick peek at the data will show comparative declines in all the major industrialised countries at that time. Britain's experience was painful, but a fair degree of that pain was caused by efforts spent trying to resist change, rather than embrace it. Despite what you may think, Britain is still abour 6th or 7th in the world for inductrial production.

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Dave B
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Re: Energy tariffs

#17 Postby Dave B » October 21st, 2012, 3:46 pm

Never mind about our inductrial production, Nick, what about our industrial one?

:D

But I still wonder about all the empty, some for as long as I have lived in this area, factories and workshops in this area. From what I have heard Gloucester is not unique for this. Where is all this manufacture going on and what it being made? Most of the stuff in the shops seems to have been made in China.

I know that the car industry, though a mere shadow of itself in terms of the number of people it employs, is doing reasonably well. I do know that the loss of jobs there is as much a function of inevitable technology advances as it is a lack of places in which to actually work.
"Look forward; yesterday was a lesson, if you did not learn from it you wasted it."
Me, 2015

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Nick
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Re: Energy tariffs

#18 Postby Nick » October 21st, 2012, 4:03 pm

Alan H wrote:Which? have been campaigning on energy prices for a while.
I have a very healthy skepticism about Which? Much of their advice on financial services has been pretty awful, so I don't rely on any of their other advice much either. Let's see...

Cheapest energy tariffs for all customers
Which? executive director Richard Lloyd called the announcement a 'big statement' and a sign that the Prime Minister 'acknowledges that competition in the energy retail market has failed'.
Well, that is a complete non sequitur. It may show that more competition would bring down average prices, but it does not demonstrate that zero competition would solve a damn thing.

Words must become action
Earlier today Which? sent a letter to the Prime Minister asking for an urgent, expert, independent review of the energy market.
Oh, Gee, thanks! How could we cope without you... :rolleyes:

In the last week British Gas, Scottish Power and Npower have all increased their customers' energy costs, and SSE has implemented its cost increase announced in the summer.
So what's your point?

With the average energy bill already rising 13% since last year, consumers tell us that energy prices are one of their top financial concerns.
So what's new? When is paying bills not a top financial concern?

Keep energy prices in check
A number of companies have suggested their price rises are the result of wholesale increases, government policies and environmental schemes impacting on their costs.
Damn right. It's not just a suggestion. It's true. If we are into transparency and disclosure, then it should definitely include all the green costs and subsidies. While job creation may be good for those employed, to everyone else it is a cost.

Richard Lloyd said: 'The energy companies blame wholesale price increases but even the regulator has found that prices don't fall when the wholesale price drops. The sector is dominated by a handful of big and powerful players who are seemingly unaffected by the normal competitive pressure of price and customer service.'
Again we have a on sequitur. About half a dozen suppliers account for about 70% of the market. But that is till better than 1 supplier for 100% of the market. The problem is as much that most people cannot be bothered to find the cheapest supplier; they have better things to do. In just the same way that people often keep the same job for years at a time, rather than keeping their income and promotion continually under review. But unless you are alleging collusion, the energy suppliers are keen as mustard to gain new accounts. But as we have headr from Lewist, it is not always price which is the most important factor. If this is the case, should the government really be trying to encourage everyone to make judgements on that basis?

Energy companies have hiked prices, but are their reasons really justified? In this letter to Prime Minister David Cameron, we call on him to commission an urgent, independent review into the energy market.
....ust like the others we've already had....

Dear Prime Minister,

Today marks the anniversary of the Energy Summit you held that promised action to help people to keep their energy bills down.

One year on, and with winter fast approaching, more than 20 million households are facing inflation-busting price rises as four of the UK’s largest energy companies put their prices up yet again.
Oh, good grief. INflation indeces are composed of a multitude of prices. Just because some of them must inevitably be abovethe overall inflation rate doesn't mean they are inflation busting. You don't leap with joy that the other half of the index is below the rate of inflation, do you? If you pretend to be rigorous, instead of just another publication, try to keep to the facts.

With the average energy bill already rising 13% since last year, it is no wonder consumers tell us that energy prices are one of their top financial concerns.
OK, but why is this? I can think of several reasons which are much more likely to account for this than the actions of naughty supply companies.

After the Energy Summit, you said “we are making energy companies be competitive” but there is little evidence of this. 75% of consumers are on the most expensive tariffs and the level of switching continues to decline.
Again, that doesn't tell us much. Perhaps the cheaper tariffs are only applicable to 25% of consumers. Should they be denied the cheaper prices? And the decline in the levels of switching could be caused by the various energy companies becoming more competitive, couldn't it?

It’s time to face facts: the energy market is broken.
People are questioning whether they are paying a fair price for their gas and electricity. The energy companies blame wholesale price increases but even the regulator has found that prices don’t fall when the wholesale price drops. The sector is dominated by a handful of big and powerful players who are seemingly unaffected by the normal competitive pressure of price and customer service.
Non sequitur, see above.

They also blame the cost of implementing your government’s environmental and social policies for the price rises. Yet, as your own Energy Department has said, there is no hard evidence to back this claim up.
Hmmm.... so you think that all the green initiatives are cost free, huh...? Pull the other one.

Claim and counter claim are played out in the media but consumers deserve the truth. Ofgem’s proposals to change the retail energy market, expected shortly, are necessary but not enough.
But all you've done is engage in a media circus, that's all.

Urgent, independent review into the energy market
So today we are calling on you to launch an urgent, expert, independent review into the rising cost of domestic energy bills and whether competition among energy suppliers can be made to work more effectively in the consumer interest. We want an independent review to look at whether the reasons given for the recent price increases are justified.
So you admit that you haven't a clue.....

We also believe a review must identify what reporting measures should be required of energy companies, relating to both the wholesale and retail markets and the costs of social and environmental policies, to increase transparency and give consumers confidence that everything possible is being done to keep energy prices in check.
Of course, bsides putting the costs up, I doubt you are advocating that consumers can opt for unsocial or ungreen options, are you. Certainly transparency could be improved, but I bet the comparison sites have thought of this. Is it not more likely that people can't be bothered to keep on switching? Especially as there is no guarantee that a switch today will not have to be undone in the near future?

The review must also consider whether the regulator should now be required to better protect the majority of consumers on expensive ‘standard’ tariffs by introducing a fair cap on ‘standard’ prices.
Ah! Price controls! Have you realy learnt nothing from economic history?

Until we see greater transparency and prices presented clearly, consumers will continue to distrust the energy market and remain unable to drive genuine competition through moving to the cheapest tariffs.
I doubt we will ever see the day when anyone is delighted by their energy bills...

The time for action is now. Warm words alone are not enough to keep consumers from the cold this winter.
Oh, the irony. No idea of the causes, no real solutions, and you end with platitudinous warm words.

(Please excuse the typo's)

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Alan H
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Re: Energy tariffs

#19 Postby Alan H » October 21st, 2012, 4:42 pm

:yawn:
Alan Henness

There are three fundamental questions for anyone advocating Brexit:

1. What, precisely, are the significant and tangible benefits of leaving the EU?
2. What damage to the UK and its citizens is an acceptable price to pay for those benefits?
3. Which ruling of the ECJ is most persuasive of the need to leave its jurisdiction?

User avatar
Nick
Posts: 11027
Joined: July 4th, 2007, 10:10 am

Re: Energy tariffs

#20 Postby Nick » October 21st, 2012, 6:12 pm

Indeed. Have they never heard of uSwitch....?


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