All of the big six energy providers – British Gas, EDF, Eon, Npower, Scottish Power and SSE – have now announced price cuts to their standard tariffs, most to hit over the next month; but these are piddly, paltry, tiny, irrelevant and, ultimately, ignorable. Even after these cuts of roughly £30 a year, without any question you are BEING RIPPED OFF – typically by over £300 a year.
If you’re detecting a sense of frustration in my writing, you are correct. I’ve been banging on about this for over a decade, yet still 70 per cent of the UK population are on these damn awful tariffs. So before I get into the whats and hows, let me prove why you need to listen.
In recent weeks my Twitter and email mailbag’s been swamped with people shocked at their savings and wishing they’d done it before.
Here’s just two:
Sarah: “Switched gas and electric. Saving of £1,117 per year, should have done it years ago.”
Jo: “@MartinSLewis – just switched & saved £813 on my gas & electric?!? Un-flippin’ believable!! Thank you for banging on about it!”
1 It’s quick and easy to switch
Slashing the amount you pay for energy really isn’t difficult. It takes minutes to find your cheapest, then it’s switched over in 17 days. I got four newish members of my team to do a comparison and on average it took five minutes 52 seconds.
Those who worry about switching, don’t – it’s the same pipes, gas, meter and safety – the only thing that changes is price and customer service.
2 Use a comparison site but do it the right way.
As your saving and your cheapest depends on where you live and what you use, there’s no one winner. Plug your details into a comparison site and it’ll show your best deal.
To do this, you need your address, your current tariff and your usage. The best usage to put in is your Kilowatt hours, if not that, then your annual cost, if not then monthly cost.
If you don’t have any info – just guess! While you may not get the perfect result, if you’re on a standard tariff you’ll save substantially.
To do a comparison you can use my www.CheapEnergyClub.com or, alternatively, you can use any www.ofgem.gov.uk approved comparison site, but, if so, do watch for two things.
n Ensure it searches all tariffs. Some comparison sites by default will only show you the tariffs that they get paid for. This filters out some of the cheapest deals. Make sure when you’re doing a comparison you’ve selected the option to see all the results, that way you’ll get to see the best deals.
n Beware personal projections if you’re on a fixed tariff. When doing a comparison, most comparison sites follow the regulators’ guidance and show your ‘personal projection’, which is effectively your average energy cost over the next year.
This is normally fine, but is nonsense for anyone on a fixed tariff ending within 12 months – something I’ve campaigned against, to little avail.
For example, if your current fix costs £800 a year and ends in six months, and after you’ll then pay £1,200 a year, as you’ll be on the energy firm’s standard tariff, the personal projection say you’ll pay £1,000 in a year – the cost averaged over 12 months.
So if the market’s cheapest deal is £900 a year, the results will tell you to switch and save £100. Yet do it now and for the first six months you’ll actually be paying more, not less. You need to see both prices to make a decision, which www.cheapenergyclub.co.uk does. Comparethemarket.com and energyhelpline.com have options to see both as well.
n Check customer service feedback too. It’s not all about pure price, service counts. It may be worth paying a little more for one with a good service record; Ovo is relatively cheap for many people with a good track record. Most comparison sites include some service listings.
3 If you don’t want to change supplier, change tariff.
Many confuse changing tariffs with changing companies, but you don’t necessarily have to. For example, at the time of writing if you’re on Npower’s standard tariff, which on typical usage is £1,110/year, you can switch to its cheapest 12-month fix, which is actually one of the market’s cheapest at £781/year – saving £320.
So at the very least do a comparison and if you really don’t want to switch at least move to your supplier’s cheapest. It’s worth noting some firms also operate under more than one name, for example British Gas is also Scottish Gas and Sainsbury’s Energy.
Also some big suppliers offer far cheaper deals via ‘collective switches’ through local councils or comparison sites. So you may find you can save £100s and stay just where you are – but never sign up to a collective switch that doesn’t offer a full market comparison as part of it.
Quick Q&A: I’ve only got electricity, can I save?
There are cheap deals that allow electricity-only switching. Someone on a standard tariff paying £1,000/year would pay about £750/year with the cheapest. Again, just do a comparison, same for economy 7.
I’m on prepay (key or card meter) – can I switch?
Yes. Someone with typical use on a standard prepay tariff pays £1,163/year– the cheapest is £1,050/year, so a comparison and switch will help.
Yet a normal billed meter paying fixed monthly direct debits is far, far cheaper. So if you can, it’s also worth considering if you can change to a normal billed meter, where usage is measured, and you’re billed after.
I’m £100s in credit with my energy firm, will I get it back if I leave?
It should give you this money once you’ve switched. Many do it automatically, but make sure you ask if not. In the past, they used to operate a ‘don’t ask, don’t get’ policy, so if you’ve switched previously, it may be worth calling your old supplier to check.
If you’re in debt you can usually switch, unless the debt’s very large – though you still have to pay it back what you owe.