As the nights draw in, the prospect of surging winter fuel bills approaches, so it pays to plan now to make sure you’re paying as little for your energy as possible and to cut down on the energy that you don’t need.
The truth is that far too few of us shop around for the best energy deals, with 57% of households stuck on expensive standard variable tariffs, typically paying £300 more than they would on the cheapest tariffs, according to energy regulator Ofgem.
However, we are getting better at it. Some nine million electricity and gas contracts were switched in 2017, the highest transfer rates since 2009 and 2008 respectively. Yet those who don’t switch are paying, rather than being paid, for their loyalty.
New measures are now in place to prevent people from being ripped off, such as the safeguard tariff which stops suppliers from charging customers on poor value deals too much and a switching programme, yet to be implemented, which will allow consumers to switch by the end of the next working day.
In any case, you’ll end up paying far less if you take matters into your own hands.
If you are a renting a property and are directly responsible for paying the gas and/or electricity bills, you have the right to choose your own energy supplier too.
Ditch and switch
Finding a better energy deal has never been easier. There is a wealth of online comparison sites you can use to check if you can get a cheaper deal elsewhere. These include mainstream sites – uSwitch.com and GoCompare.com, for instance – and energy specialists, such as the Energy Helpline (Energyhelpline.com).
The more information you can provide about what you pay, the better the recommendations you will receive. Remember the best deal for you depends on how much energy you use and where you live; what is the best deal for one household won’t necessarily be best for you.
You can also get cheaper deals through group switching services, such as those offered by Cheaper Energy Together and Money Saving Expert’s the Cheap Energy Club. With these, consumers effectively club together to sign up for an energy deal collectively, giving the company running the switch more clout when negotiating deals with energy suppliers.
When you do come to switch, always check your meter readings and don’t rely on your supplier’s estimates, which can lead to you paying for more than you use or racking up a big unexpected bill at a later date. You’d never accept an ‘estimated’ bill in a supermarket, so why should your energy be any different?
You may also be entitled to compensation if your switch goes wrong or is delayed. Ofgem announced in June (2018) that suppliers will be automatically required to pay at least £30 in compensation for each switching problem such as customers being mistakenly switched to another supplier or switches taking longer than 21 days. Automatic compensation should be in place by the end of the year.
“I save £300 a year by switching suppliers”
Michael Newman, a self-employed landlord from Nottingham with three children (pictured above), saves around £300 a year on his family’s household energy bills. He’s a dedicated switcher, having made more than £1,000 this year by flipping bank accounts and broadband suppliers.
“I saved through a double-whammy of switching to cheaper deals and getting cashback at the same time.
“Through cashback, I’ve made £100 in two switches in nine months, and I’ve saved £200 a year by switching from British Gas to Scottish Power, and then to Npower.
“Switching takes about a month and it doesn’t always go smoothly. There can be hiccoughs with the old supplier not calculating the final bill correctly. But I always check the actual readings and customers services have amended any errors.
“My advice to switchers is to find the best tariff, and if there is cashback that’s an added bonus. Try not to get tied in for a year. Some deals also have early exit fees though I’ve been quite lucky; you just need to keep an eye out.”
Energy-proof your home
Paying less for the energy you use is only half the battle against your utility bills – cutting out unnecessary usage can take just as much, if not more, pressure off your wallet.
Turning down your thermostat by just 1°C can save you £85 a year, and even bigger gains can be locked in through proper insulation, says Claire Osborne, energy expert at uSwitch: “Insulating your home is one of the best things to do to reduce your energy bills – making your house warmer and more comfortable.
“Warm air can escape from your home in all directions including the roof, walls, floor, windows and doors. There are now government-backed full and partial grants available to help you pay for insulation if your home has cavity walls. Getting this done could save you around £160 on your fuel bills a year.”
Visit Gov.uk/energy-grants-calculator to check what you might qualify for.
Potential support will depend on whether you’re a homeowner or renter, your income status, and the age of your house. Even if you can’t qualify for government support, the grants calculator includes information about private firms in your local area that offer grants and discounts to insulate your home or to install energy-producing gadgets such as solar panels.
Tricks to cut your energy usage
Sarah Scrivener, smart energy expert at British Gas, lists her top tips for saving energy around the home.
In the kitchen
- Turn the oven off a few minutes earlier. Many dishes will keep cooking while the oven is cooling.
- Boil water for pasta and rice in the kettle instead of on the hob – it’s far more efficient.
- Where possible, use a microwave instead of an electric oven. Some dishes take just 10 minutes in a microwave, which can save you £156 a year.
- 90% of a washing machine’s energy goes on heating the water – switching to 30°C from 40°C can save you a third of your running costs.
- Dry clothes on the line where you can – tumble driers are one of the most energy-hungry household appliances. Also avoid the temptation to dry clothes on the radiator, which forces your boiler to work harder than it needs to.
- Keep radiators clear – a poorly placed sofa will absorb a lot of the heat.
- If you have high ceilings, use a shelf above the radiator to direct heat to the centre of the room.
- Set your heating to come on 15 to 30 minutes before your need it, and to go off 30 minutes before you go to bed.
- About 20% of a typical gas-heated household’s energy is used to heat water for showers, baths and hot taps, costing £140 a year. So keep showers to 10 minutes or invest in a shower monitor to keep an eye on how much water you’re using – you can often get devices to help with this for free from your water provider.
Update to smart technology
There is a government initiative to provide everyone in the UK with smart meters by 2020. When you’ll get one depends on where you live and your energy supplier, though you shouldn’t be charged for the device. Smart meters aim to accurately measure your energy usage, as opposed to estimating it – hopefully ensuring you get the correct bill. Contact your energy supplier to see if you might be eligible for one now.
If you’re willing to pay extra, other technology can cut your bills too. There are thermostat gadgets available that allow you to control your home on the fly through a mobile app. They’re not cheap, but might save you money in the long run.
Ms Osborne explains: “Smart thermostats allow you to remotely control your home’s temperature so if you’re on holiday and realise you forgot to turn off the heating, fixing the error is just a few taps away on your smartphone.
“They don’t directly save you money the way switching energy supplier can. However, they provide the ability to heat your home more efficiently, which should save you in the long run.
You will also receive reports about your energy usage, which can help you better understand how you’re heating your home, and adjust your behaviour and preferences accordingly to save money.”
Netatmo for example offers mobile-controlled radiators that let you manage temperatures in each room of your house, or turn them off completely when you’re away from home. The company estimates it can cut heating bills by 37%. Wastage is cut further through smart features, including switching off radiators if the device detects an open window in the room. The devices are priced from £69.99 (per radiator).
Similar devices enable you to control lighting from your phone, though prices for these typically start at about £150.
Questions to ask before switching
How much energy are you using? Your energy bills should detail your current usage. You can then input this information into a comparison tool to find the most appropriate tariff for you.
How is your new supplier’s customer service? Finding the cheapest deal can be a false economy if poor customer service drives you to despair. You’ll find regular updates about complaints at Moneywise.co.uk, plus the Citizen’s Advice regularly ranks providers for customer service. It currently ranks the three best providers as So Energy, E, Engine and SSE, in that order.
Will you forfeit government support? Pensioners and some people on low incomes might qualify for the Warm Home Discount, which knocks £140 off your winter electricity bill. Not every energy supplier will let you claim this discount (though most will), so check you won’t lose it by switching to a cheaper deal from a smaller supplier.
Can you boost your savings with cashback? Once you’ve found the tariff you want, check if you’re eligible for a cashback bonus by going through a cashback site – start with Quidco or TopCashback. Your priority should be the cheapest tariff though – cashback is a nice bonus, but it’s not a good reason to switch in itself.