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Energy bills: do you stand to overpay by £400?

Energy bill confusion

What’s the difference between a fixed energy tariff and standard variable tariff? If you’re unsure, don’t worry. You are not alone.

Luckily, we have a handy guide explaining the ins and outs of the various energy tariffs here.

The next question; do you know which one you’re on? Again, you’d be forgiven for not knowing. Check out your latest bill to find out.

Now perhaps the most important question; are you prepared to lose £400 this year? Because that could happen if you’re not aware of how you pay for your energy.

Many households could see their energy bills soar by up to £416 in a year, as a number of fixed tariffs come to an end this month.

Energy tariffs expiring

Customers risk being automatically moved onto standard variable tariffs when 17 fixed deals from ten suppliers – including seven with the big six energy providers – expire in May. So if your tariff is coming to end, I urge you to start shopping around and switch now.

Incidents like this are precisely the reason why we have been calling for action in the energy market. In fact, recent Which? research found that more than half of people consider energy to be priority issue for the next government. This is hardly a surprise when energy prices have increased more than 40% for gas and 35% for electricity over the last 10 years.

It’s a timely moment to consider this when a cap on energy prices is being discussed. If the next government were to introduce a cap on energy prices, we think there are a number of tests that would need to be passed to ensure customers get a fair deal on their energy prices. These five tests for any energy price cap are that:

  • It must not cause longer-term price increases
  • It must not ​remove incentives for providers to improve their service
  • It must not stifle innovation
  • It must lead to a truly competitive energy market
  • It must have clear criteria for bringing any cap to an end

Did you understand the difference in tariffs when you signed up to your energy provider? Have you made moves to stop yourself losing money? How do you think an energy market can function in the best interests of consumers?

Fixed energy deals ending in May 2017

All prices are provided by Energylinx, based on the details of a dual-fuel medium user who uses 13,500kWh gas and 3,100kWh electricity per year, pays by monthly direct debit and chooses paperless billing. Prices are rounded to the nearest whole pound and averaged across all UK regions. Data correct at 8 May 2017.

Comments
Profile photo of wavechange
Member

I would like to see Which? helping all consumers and not just those who regularly review energy prices. There is something fundamentally wrong with the energy industry that allows companies to charge some customers significantly higher prices, and that’s the problem I would like Which? to tackle.

I have no problem with companies charging whatever prices they want for cruises, luxury cars and jewellery but energy is vital for all of us. I will be interested to hear more about a cap on prices and the views of Which?

Profile photo of malcolm r
Member

Companies do not “charge” people (at least not most of them) significantly higher prices; customers are free to choose other tariffs. The fact the CMA reported was that many don’t, because they cannot be bothered rather than they do not know how. And those on fixed deals will know to switch to another when their’s ends – if they remember to do so, of course.

However, I believe fixed price fixed term (usually 1 year) deals are subsidised by standard variable tariffs. Why? I would like to see these fixed subsidised tariffs abolished and, with the subsidy removed, standard variable tariffs could be reduced.These would become the default tariffs most would be on.

We’d no doubt still find some complaining about having to switch because, with the current 48 energy companies (a bit silly really), you’ll still need to shop around for the “best ” supplier for your needs. No one is going to do that for you. Or are they? If we can’t be bothered, maybe agents will become more the norm and do all the work for you regularly. But this will cost money.

Profile photo of malcolm r
Member

We must look at the numbers trotted out rather carefully. We could make savings of up to (sorry) £3-400 by switching to the cheapest fixed price deals. But, if all of us, or a lot, did that then the prices of those deals would rise to restore the profit margin of the supplier. So no longer would such savings be achieved. It is a flawed economic argument.

“We are overcharged by £1.7 billion and with 17 million of us on svts, we’ll save £100 a head”. Well, the same argument applies. We won’t. CMA estimates energy company profits at between £550 and £800 million a year. So how does an overcharge of £1.7 billion work with a profit of, say, £800 million. Are we expecting the energy companies to give away all their profit plus another £900 million?

With 43% of your bill only paying for wholesale gas and electricity, and the rest admin, government charges, distribution, profit and the like the ideal would be for Ofgem to monitor these figures so we see the real profit and then make a judgement. Price capping implies that they have the means to do this. I wonder. Normally governments are quite incompetent when it comes to intervening in markets because they have neither the knowledge not expertise to understand how they work. And the problem of unintended consequences creeps in. but still, it is good voter fodder.

Member
Richard says:
12 May 2017

The problem is the same as choosing to go to Sainsbury’s instead of Lidl. A quick comparison of the prices of a few standard items will soon reveal that Sainsbury’s are expensive but people still choose to go there. Why is this? Quite simply because Sainsbury’s by their psychological tactics convince people that they get better quality there. Of course it is all lies but proverbially “a fool and his money are soon parted.” It is of course impossible to prevent this no matter how many times you try by campaigns and publicity to do so.

Profile photo of malcolm r
Member

In the case of food I think I can tell the brands or sources I prefer. It doesn’t need any supermarket to tell me how to decide. The assumption here is that LIDL and Sainsbury’s offer equal quality. I don’t shop at either but think the assumption should be backed up with evidence.

Profile photo of John Ward
Member

I think there is such a vast difference in the range of stock between the two stores and the actual shopping experience is very different in each. That explains the preference in many cases. Even if things are more equal there is also the question of distance; Sainsbury’s and their direct rivals have the prime sites.

Profile photo of wavechange
Member

I have just received an email about a collective energy switching scheme because I used one before. I don’t recall that these feature in the results produced by Switch with Which? etc.

It’s all a mess that often penalises the less well off, who commonly don’t ‘engage’.

Profile photo of John Ward
Member

The components of energy bills in the 57% that are not actual energy are quite regressive on the less well-off. They probably cannot afford to use as much as they would like to so they get little averaging benefit from the tapered or tiered rates at the tariff margins and end up paying the highest unit rates of all.

Profile photo of DerekP
Member

Simple answer: No – I won’t be overpaying by £400.

Actually, I agree with malcolm r’s views on these prices. Hence, having shopped around, I’ll be underpaying by £200, while those who haven’t will be continuing to overpay by £200.

Profile photo of PatrickTaylor
Member

Well it is enough to make the blood boil as yet again we cover the same old ground and Which? writers seem unable to grasp, or perhaps decide to make simplistic , that the world price for energy affects the UK. They also resolutely refuse to discuss that in many EU countries consumers pay more for electricity /gas than we do. Or the make-up of the bill beyond energy prices.

IF Which? really wanted to do something useful it would be pushing the eco-home agenda and setting up show houses around the UK on how you can substantially reduce usage. Some Consumer bodies in Europe have actually set up joint buying and commissioning of solar panels for their members.

However Which? has managed one article on solar panels in its “unique” survey. Curiously the Dutch Consumer body did exactly the same thing and did mention it was a joint project of EU consumer groups. They have also revisited the survey in 2016 and list the solar panels used in their members solar project. I expect all the data is collected for the benefit of other consumers debating on the pros and cons of payback.

Technology evolves and there are new insulation panels being bought out, the possibility and economics of heat exchangers retro-fitting to extract heat from out-going air and warm replacement fresh air. Not covering the dangers of cavity wall insulation in “exposed” houses was also a fail for Which? as residents ended up paying more to heat their houses.

Basically if Which? did its role of educating and testing rather than perpetual playing to the gallery one might be much happier as a subscriber. Changing the psychology of people is way beyond Which?’s ability so lets get some new leadership in who realise that practical examples and encouragement will be far more useful in the short and long-term.

Profile photo of Sophie Gilbert
Member

How can an energy tariff system, or indeed any system, be good for society if it works for some of the people some of the time, but it baffles most people most of the time?

Profile photo of malcolm r
Member

It works for more than just some of the people. And, according to the CMA, many others could – are quite capable- but just don’t bother because they don’t regard the savings as a sufficient incentive to do it. I use Which? Switch each year to check my best deal. It is easy and quick, as is switching. What is missing is properly publicising this to enable people to take advantage. Which? could advertise this on TV – but don’t.

However, I keep suggesting abandoning the cheaper fixed price tariffs and using the subsidy they require to bring down standard variable tariffs. Then most of us would be on these. However unless we want a monopoly, there will always be a number of energy suppliers so, like buying anything else, if we want the best deal we’ll need to shop around – or get someone to do it for us.

We see money spent on Gaz and Leccy – stupid cartoons advertising dubious smart meters. A pity the same money and effort is not put into showing those who don’t already know the ease and advantages of shopping around.

Profile photo of wavechange
Member

I want to see energy supply run primarily for the benefit of the public and not the shareholders of the companies in the industry. I’m with Sophie.

Profile photo of John Ward
Member

I have also been amused by the fact that the irony of using dumb cartoon characters to promote ‘smart’ meters is totally lost on the organisation [Smart Energy GB] whose burden in life is to get us all hooked up. Most of us have probably been getting Gaz and Leccy under control for years without charging billions of pounds to do so. In fact I am still not sure who this campaign is aimed at.

Profile photo of wavechange
Member

This could be why the smart meter roll-out is so expensive, John. I wonder if it is ever mentioned that we can decline to have smart meters installed and that they might not work properly if we switch supplier. Never mind, we can then have a new ‘free’ smart meters installed and the cost will be shared by all customers.

If I had my way, those struggling to pay their bills should be given smart meters in the hope that they could help these customers and anyone else who wants one should pay.

I wonder if Which? has any views on the high cost of the smart meter roll out.

Profile photo of wavechange
Member

I wonder how much the cost of customers switching suppliers is costing consumers – including those who do not switch?

A representative of uSwitch was interviewed on radio recently and asked how much they charge for those who switch using their service. He declined to answer on the basis that it was confidential commercial information. We need to the Freedom of Information Act to be changed so that we can obtain information that should be available to consumers.

@Colum-McGuire Please could you find out how much the switching services charge if consumers switch using their services? It’s a while since we were given any information by Which?

Profile photo of malcolm r
Member

Which? receive payments from some suppliers if you use the Which?Switch site to switch suppliers.

I do not know what “for the benefit of the public” really means. Do you want energy nationalised, so we all pay the same? Subsidies? It would be useful if you could expand your proposals so we can see what they involve.

Energy is one of the less expensive parts of most peoples budget, compared to housing, food and, for many, commuting. If we want to reduce people’s expenditure we might get better results by examining these perhaps.

Profile photo of wavechange
Member

We have discussed this at length, Malcolm, and I have made it clear that I don’t want energy nationalised. As I have said repeatedly, we could sell energy at a fixed price and retain the benefits of competition elsewhere in the industry.

If you and I switch to the cheapest deals then our energy price is subsidised by those who pay more, as has been pointed out by others. Those paying more include many people who don’t have much money. I want to put an end to exploitation of the poor.

Profile photo of malcolm r
Member

So you would support scrapping the subsidised or low-profit fixed term fixed price deals and reduce SVT prices accordingly that most people would then be on?

Being “poor” does not automatically mean you do not have the intelligence to look after your finances. To suggest they are is a little demeaning. I know many people who are far from well off but shop wisely and choose their energy supplier appropriately. It is part of the wider population – some of them poor and well off alike – who do not switch. I suspect you really mean the “vulnerable” and I have suggested elsewhere it is the vulnerable people – those unable to look after their own affairs – who need our help and support and we should address dealing with that issue.

Profile photo of wavechange
Member

I am focusing on the problem rather than suggesting how it is resolved.

“Being “poor” does not automatically mean you do not have the intelligence to look after your finances. To suggest they are is a little demeaning.” I find that unpleasant. 🙁

I have given many reasons why people are too preoccupied with other matters to think about energy costs. Two days ago I learned that the chap at No. 36 is likely to go into a hospice, having spent the past two years losing the battle against cancer. Yesterday afternoon, the ambulance turned up. Perhaps his wife should now focus on sorting out a cheaper energy supplier, but I suspect that she will spend as much time as she can with her husband.

I have given many other true stories about why people can be preoccupied with family and other issues in our discussions, Malcolm. I doubt that any of them were poor or vulnerable (I can differentiate between these categories) but why should we allow any company to exploit its customers because they have not played the switching game.

Profile photo of malcolm r
Member

We should differentiate between the vulnerable who cannot help themselves, and require our extra help, and those capable of running their own lives. And we need to focus on solutions to the problem; only then might we make progress.

There was nothing meant to be unpleasant in pointing out the poor are likely to be just as capable of looking after their affairs as anyone else.

I have proposed one means to improve (in my view) the fairness of energy tariffs. See above; maybe you would give your view? However, we will still need to choose what is best for our needs – a regular SVT, an off peak tariff, and which supplier; so we will still need to do some shopping around, just as most of us do for a lot of other things.

Profile photo of wavechange
Member

Why is it right that companies should be allowed to charge some customers significantly more than others for an essential service, Malcolm? To my mind, it does not matter how much money a person has. I have focused on energy because, unlike food etc. there is no quality issue when discussing electricity and gas prices.

Would you be happy if companies charged some customers ten times what they charge other if they could get away with it? I think it might be useful to control the excesses of our capitalist system.

Profile photo of malcolm r
Member

I have made the same point in a different way by offering a solution. The cheap (subsidised) deals are the fixed term fixed price. Scrap those and reduce the SVTs appropriately. That is a possible solution, and it is solutions we need, surely? Would you like to join in a campaign to do that?

There might be no quality issues, but different companies buy their energy from different sources, in different ways and at different prices. They therefore have different costs.

Profile photo of wavechange
Member

I want to see an end to the large price difference that results in some people paying considerably more for their energy. How this is achieved is up to Ofgem, the government and the companies.

It’s a valid point that different companies use different energy sources. Maybe there is a need for standardisation. A simple example is that diesel used as road fuel contains biodiesel and petrol contains ethanol – as specified by the relevant British Standards, I believe.

Profile photo of malcolm r
Member

The large differences in my experience exist because of the difference between fixed price fixed term tariffs, and standard variable tariffs that seems to subsidise them. I am proposing we simply stop this.

How do you standardise energy when it comes from different sources – wind, diesel, coal, wood pellet, gas, hydro…… Companies that invest in different methods need to have a return on that investment, and the electricity will cost different amounts. Gas comes from different sources. And companies buy in different ways – some use spot pricing, some will buy 1, 2 or 3 years ahead. Many will do the same with the dollars they need to purchase the raw material. So, as I see it, whilst the products might be the same they cost the suppliers differently and part of the ability to offer more or less competitive prices to consumers stems from that. Government can distort this by subsidies and guaranteed payments of course, and does, but there remain underlying cost differences.

Profile photo of wavechange
Member

If we all pay the same price for energy then the companies can choose whichever sources they want and it need not concern the consumer.

Many food essentials cost much the same in different supermarkets. For example, 2.26 litres of milk generally costs the consumer around £1.

Profile photo of malcolm r
Member

Milk – not universal. It costs more than this to produce I believe.

If you pay the same price to all energy companies, the larger ones who invest capita;l in generation and storage, then those with cheaper supplies would make bigger profits. We wouldn’t like that (would we?).

Like minded people who feel strongly about this can always form a cooperative and share out the profits. The advantages of a capitalist world is that no one is precluded from making a business. i wouldn’t like that to change as, whilst it might not be perfect, I haven’t seen a more perfect model.

Profile photo of wavechange
Member

It’s a long time since I’ve been in a supermarket that charges more than £1 for a bottle of milk.

The answer to the problem of larger companies using their buying power to make bigger profits could be to limit the size of companies. Some of the biggest problems in society relate to large multinational companies. Maybe we could charge everyone the same price for energy and allow companies to tender to supply no more than a fixed amount, say between 5 and 10%.

I suggest we think about people less fortunate than ourselves. 🙂

Profile photo of malcolm r
Member

“I suggest we think about people less fortunate than ourselves.
We do. We simply may have different ways of approaching it. I have proposed a number of times the “vulnerable” should receive special attention and help from us all – Ofgem, for example, has required energy companies to do this.

We might regard dairy farmers as less fortunate than ourselves if they have to sell milk at less than the cost of production.

Profile photo of wavechange
Member

By people less fortunate than ourselves I include the poor, not just the vulnerable. Rich or poor, I don’t believe it is right that the energy companies are allowed to charge some of their customers much more than others.

I was speaking to a farmer two weeks ago and he said that paying more for milk does not necessarily mean that farmers are paid more.

Profile photo of malcolm r
Member

Some supermarkets have beneficial agreements with farmers.

I have made a proposal that would, I believe, provide better energy tariffs. Suggesting solutions is a way to progress.

When we talk about the poor I am happy to help those who have, or have had, no options to improve themselves or their lives. However, we need to look critically at who deserves our statehelp,which often means our money. Individuals, of course, can give money and help to whoever they wish.

Profile photo of wavechange
Member

Don’t assume that the farmers benefit very much if we pay extra for milk. Marks & Spencer may pay the farmers a few pence more but I believe they charge the customer 29p extra: https://www.fginsight.com/news/news/how-much-do-supermarkets-really-pay-dairy-farmers-14277

The citizens of this country deserve not to be exploited by the energy companies, be they rich or poor. I suspect that if we asked the public, the majority would prefer that everyone payed the same price for energy rather than having the current complicated system.

Profile photo of malcolm r
Member

If M&S give the farmers a fairer price then of course they will charge the customers more. If customers are prepared to do that than all well and good.

Competition gives us all (except the “vulnerable”) the ability to seek out the most competitive deals in whatever we purchase – if we choose to bother. Many may not be that concerned about saving money as the CMA report found. Perhaps the evidence that the majority would prefer the same price for electricity and gas could be provided. I firstly doubt that they do, secondly do not want minority mantra imposed on others, and that “same price” might well prove more expensive for a large proportion of customers than they currently pay; I doubt they would relish that prospect.

Artificial devices imposed on markets do not work, in my view. We have a competitive market(around 48 energy suppliers) where you can find your best deal very easily through, for example, Which?Switch. What is being suggested is that because some choose not to engage with this market (put those unable to, the vulnerable, aside because I have repeatedly said we should help then by separate methods), many of whom simply cannot be bothered, we must therefore remove this freedom of choice.

How many other essential purchases – water, food, rent, insurances, fuel- should we apply this principle to?

Profile photo of wavechange
Member

Let’s leave the vulnerable out of this discussion because we and I hope most other people agree that they should be supported.

I don’t believe we have tried selling energy to all consumers at the same price, so we don’t know how it would work. From what I have seen, business is good at adapting to new legislation.

I have mentioned real examples of people who have been preoccupied with illness or family problems and someone in the early stages of dementia. They are not going to engage with the energy market. I would prefer that they are not exploited by the energy companies and simply paid the same as those of us who have engaged.

The only time in my life when I’ve had much contact with poorer people was when I lived in a rented flat while settling into a new job and house-hunting in my spare time. I found that the landlord’s meter in the all-electric flat was set to charge four times the permissible rate. I checked two of the other flats in the same building, and they were the same as mine. The landlord claimed that it was a mistake by one of his contractors and said that he would give us all a refund. At the time I was amazed that the other tenants had not realised that they were being overcharged but have since heard many tales about unscrupulous landlords.

Profile photo of malcolm r
Member

I don’t see any of the individual examples supporting the proposed “single price”. They seem like vulnerable people who need separate protection.

We have commercial companies generating and buying energy in different ways from different sources at different prices. These companies have different operating costs. Hence they can offer us different consumer prices and we have the freedom to choose the one that best suits us.

Now we want them all to charge the same. This means some will make bigger profits than others – do we want to do this? Featherbedding profitable companies is not what i want to see.

Who sets the “price” and who alters it as world prices change? I doubt any government department or regulator has the knowledge or expertise to do this competently.

We spend more on food than energy. So do we impose fixed prices on all shops and supermarkets for the staples that all need? Or perhaps, if “unfortunate” enough not to live near a cheap shop, provide free transport to another outlet to take advantage of lower prices.

I have suggested a way to make, in my view, tariffs fairer. Perhaps commenting on this would move us forward. We will not have a universal energy price.

Member
Mark Breslin says:
15 May 2017

If M&S are charging 29p more then the farmers should get that 29p, giving the farmers ‘a few pence more’ is doing nothing but cashing in on the fact that peeps shopping at M&S know the farmers get screwed to the ground on price by supermarkets and believe it ethical that they should be paid more. As far as I can see on that score M& S are purely cashing in, nothing else !

Profile photo of malcolm r
Member

https://corporate.marksandspencer.com/plan-a/our-stories/about-our-farmers/milk
I presume other supermarkets have deals with dairy farmers. They may well be selling milk at a loss, of course.

Profile photo of wavechange
Member

Malcolm – I have explained that I am keen to discuss energy because there is not the complication of quality, which would be a factor for other essentials. You pointed out that energy can come from various sources costing different amounts, but there is no need for this to be the case. Rather than having different companies using different proportions of green energy, for example, the companies could be told what proportions to use. I mentioned diesel and petrol as examples where this system is already in use.

I put the needs of citizens of this country before the wishes of companies that are there to serve our needs. The government, via Ofgem, should be making the rules, in my view.

Profile photo of malcolm r
Member

We could have a cooperative that tries to achieve your wishes – that might show the commercial companies how its done?

I’d like to see evidence of successful economies that avoid the use of competitive commercial organisations.

Profile photo of wavechange
Member

I would certainly be interested to see how a cooperative fared, though I don’t believe that this option is yet on the cards.

I am not opposed to competitive commercial organisations as long as their operations do not create problems. In the case of energy, companies are allowed to charge some customers significantly more than others for energy. I see this as exploitation, and in many cases it is exploitation of poorer people and not just the vulnerable.

I’m certainly not seeking nationalisation of energy but I believe that it is still possible to have competition within the industry while selling the same product for the same price to everyone. I am keen to narrow the gap between rich and poor as well as discouraging waste and raising awareness of environmental issues.

Member
5binDave says:
30 May 2017

Using your term “vulnerable” Don’t forget those that “pay as you go” with cards. They do not have a clue what rate they are paying for their energy. Those who top up by £10 are usually topping up again the next day. (We run a store). This definitely needs looking at.

Paperless billing. Just found a flaw. My current supplier has bizarrely claimed my annual usage has increased, I say bizarrely because its based on estimated meter readings. To back up my case I went back to my annual statements, a couple of years though I failed to download them, the account is closed and the information is lost.

Member
Bob Dear says:
12 May 2017

I’d like energy companies to actively promote their best deals to all customers, especially those on their default fixed tariff. They could also offer a £50 loyalty bonus to customers who stay with them whether they switch tariffs or not.
Switching companies must make it very clear, in BIG LETTERS, if they only show those companies who pay the switching company a big fat commission for getting someone to switch!

Profile photo of malcolm r
Member

Bob, the question I ask is “why should there be a best deal” from a particular supplier, other than deals tailored to your particular circumstances – such as off peak? I think we should mostly be on standard variable tariffs, reduced in price by abolishing the artificially low (I believe) fixed price one year tariffs. Your “best deal” would then be determined by shopping around the different energy suppliers.

Member
Terry says:
12 May 2017

Years ago customers (consumers as they were known then) paid more for the gas/electric supplied if they chose to have a coin slot meter. This was because a meter reader had to call to read and empty the meter of coins. Nowadays customers who wish to pay as they go use a card which they replenish at retail outlets and prepay for the gas/electricity used. They should not be penalised with higher tariff prices. My personal view is that the basic necessities of life such as gas, electric, water and public transport should never have been privatised in the first place. It has not led to competition but profiteering to satisfy the shareholders and a reduction of standards to customer service. In other words how much can we get away with, charging as much as possible for a lesser service.
If successive governments were serious in energy efficiency and eco savings then they would mandate for every new house built to have solar panels fitted as standard along with other energy saving measures installed.

Member
Colin says:
12 May 2017

I totally agree Terry. I have always said that in my opinion anyone who is prepared to pay up-front for their gas and electricity should get a discount, not pay extra. Those on pre-payment meters are almost certainly those who can afford the least, but as usual those with the deepest pockets get the best deals.

Profile photo of malcolm r
Member

Ofgem have dealt with prepayment meters to ensure for most they can get appropriate tariffs (if my memory serves me right).

Member
Chris says:
13 May 2017

Colin, my supplier is OVO Energy. I made my first direct debit payment before I received any gas or electricity. The direct debit is set high enough to leave me with a credit balance each month. I am on a cheap fixed tariff & paying up-front.

Member
John Kelly says:
12 May 2017

I am a devout capitalist, but even I understand that you never put the utilities in private hands.

Profile photo of malcolm r
Member

I certainly wouldn’t put them in public hands, judging by all governments’ lack of commercial acumen. Cost of aircraft carriers and their planes? Dreadful outsourcing of the probation, prisons and court translation services? 5 year life? Political game playing on pricing – near elections? Hidden subsidies that we all pay for to cover up inefficiencies? Maybe we need a co-operative to resell energy that returns profits to its members?

As has been pointed out before we pay less than many EU countries for our gas, and are around the top third for electricity – government levies help with that.

Member
Bob Hamilton says:
12 May 2017

We do have a Co-operative reselling energy and returning profits to its customers. I’m a member of it, as are many other people. But I’ll be switching soon because there are far cheaper tariffs elsewhere.

Member
Sheila monty says:
12 May 2017

I would dearly like to change from British Gas but having persuaded me on the telephone that I would be much better off changing from Southern Electric I changed. From the first statement I got from BG I was in debt by over £100 as the direct debit was far too low. I cannot afford to pay it off in cash so that I can move so am stuck with them. My account has been up and down, but mostly up, since I have been with them and my direct debit amount goes up and down like a yo-yo. Is there anything I can do?

Profile photo of malcolm r
Member

Check they have last years’ energy consumption from you and get them to calculate your projected cost this year – or do it yourself. Then offer them a monthly payment that will match your likely consumption and see how they respond.

If you are not on a fixed term contract go onto Which?Switch, put in last years’ consumption, your BG tariff, and see what deals are available and how they compare with BG. Change if the saving is worthwhile.

Member
Brensham says:
12 May 2017

OK I swithched. Switcher agents (National Newspaper) sent the wrong figures to new energy company which turned out to be more expensive once I informed them of the correct figures. Cancelled. Old energy company wont put me on the new less expensive tariff because they said I must start on the more expensive Quote Standard tariff as I had left. Switching is not as straight forward for all as some people have made it out on here. Oh, its all so easy!

Profile photo of malcolm r
Member

Use Which?Switch to find your best deal then switch direct to them. I would investigate a company that turned you down for a tariff – presume it was a fixed price fixed term? This is what I’d suggest will give you the best result.

Member
spamjam says:
12 May 2017

I belong to MSE group savings it has saved me ££££’s

Member
kathleen says:
12 May 2017

i am with a company who took in to consideration i have a disable daughter who has cancer and as i am over 70 has given me a good reduction and i am all so on the smart card which helps me to

Member
Saleema says:
12 May 2017

Actually I’ve found switching to be quite easy so far. I use the Energy Saving Club and have switched a few times. They offer a cash incentive on certain tariffs for both gas and electricity. The cheapest deal I’ve found is separate gas and electricity companies, paying by monthly direct debit and paperless billing.
None of my friends and family are interested in switching even if I do the research for them and ironically they are the ones who use a lot of energy. They see it as a bother and are now on a standard tariff as their fixed tariffs have come to an end.

Member
Del says:
12 May 2017

Why do people think that changing is so difficult, the only things that matter are the daily standard charge (which should have gone a long time ago but it is done to conveniently, for the Utility companies, confuse people). Once you have multiplied the daily rate by 365 days then add that to your number of kilowats used in the last or any year, from your previous bills. Then compare all of the available suppliers – Easy as that. Always have a fixed rate of at least 1 year and if any want to add a penalty for switching before then end of the period then swerve all of those. The ones you are left with – well pick the cheapest which is usually one of the smaller ones. There, you have got past probably all of the ‘big six’ with no real effort and will save against any of them.
Bonne Chance.

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i have been overpaying as a complaint led to 2k arrears as i complained they got hellish expensive so they held me to ransom by putting meters in telling me they were the cheapest and they lied this was npower complaint is now in with the energy regulator people

Member
Jean says:
12 May 2017

I have over the last ten years, insulated, replaced my boiler, put a porch on and then downsized and again replaced the boiler. I pay about 30% less than I was paying at the start when British Gas wanted me to increase my monthly payment from £100 to £120 I can’t think that prices are that much out of sync with the cost of living as our income is less than half, and energy is now £70 a month and seems less of a burden than it did,

Member
Deborah Lawson says:
12 May 2017

I have a fixed price energy deal with Pfp (Places for People energy) and this finishes in September. They are very efficient and the cost per month has been far less than most of the others on offer. I think it was a deal I obtained through 38 degrees. I am very happy with them and I hope they offer another competitive deal when mine finishes. If I changed suppliers now there would be a penalty of £60 as I have both gas and electricity with them.

Member
Jo Smith-Kearney says:
12 May 2017

I monitor usage carefully & there are no incentives to move for me because my supplier offers a realistic & better telecommunication package; otherwise might consider but all the deals I have gone through have been worse.

Member
Emlyn Jones says:
13 May 2017

I am with one of the big 6 Scottish power. They had an offer on, which was competative, and I noticed they said other offers were available checking this I found they were offering the same deal (well £1 /month more) for 2 years. which with the threat of increases I think is a good deal.

Member
Roger Daniels says:
13 May 2017

Why is it that to save on fuel cost we have to go through this process of finding another energy supplier once our fixed deal has run out and we are automatically transfered to the suppliers most expensive tariff which is usually a lot more expensive, not just a few pounds but hundreds. It just shows the these energy companies can supply our energy much cheaper but are continually trying to catch us out if we take our eye of the ball?

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I don’t believe they can “supply it much cheaper”. I believe they provide the cheaper fixed price deals by subsidising them from Standard Variable Tariffs. I have suggested abolishing those subsidised deals so the cost of SVTs can be reduced accordingly, and become the norm. All you then have to do is shop around for the best supplier and worry not about end-of-deal price uplifts.

Member
J Duke says:
13 May 2017

I have joined Money Saving Expert’s Cheap Energy Club. They monitor the market and advise me when I could save money by switching. If you choose to switch they arrange it for you, and you often get £30 cash back from them after switching. I have switched each year lately, and am currently supplied by a small supplier called Iresa.
I don’t know why people think switching is so difficult. Once you have chosen to switch you don’t have to do anything else except supply meter readings when requested, something I do each month anyway.

Member
Michael says:
14 May 2017

I switch energy supplier almost every year to make savings. Its usually worth it. I have just switched again this week after checking switch with Which? and uSwitch. Both recommend “Bulb” energy just now as the cheapest on the market. They also offer 100% renewable electricity and 10% renewable gas and NO EXIT FEES which i find wonderful.

[Sorry, Michael – it’s great to hear that you found switching so easy but we’ve had to edit your comment to align with our Community Guidelines. Please make sure that your comments aren’t promotional and are aligned with commenting rules. Thanks, mods]

Member
Martin Garrad says:
15 May 2017

I was on a EDF’s Dual Fuel Price Promise January 2017 ,having been on Price Promise 2016 before. I have now switched, having consulted Which? comparison site,as well as Ofgen’s to Economy Energy, which lasts for one year,and which they give me notice of it ending. It was very easy to switch ,only providing meter readings on the day of switching! The projected saving for me is just over £200. p.a. on direct debit.

Member
Albert Bryan Mc Cann says:
15 May 2017

Albert says I am a member of which, I have gone with Green Energy for 3 years at the same cost £30 a month. I also look after a small chapel which has been termed a Micro business, this means that it pays for electricity it uses and no standing charges. Unless the chapel has a great change in funerals or attendance it still is a Micro business. If the firm the chapel insists on trying to put a standing charge, Take them to a magistrates court , Once a micro business, unless its income changes very much always a Micro business. There are too many investors in some of the energy companies even with the staff that they employ. If you go to your food supermarket and you are paying for goods, and the girl on the till says to you, you have not been here for a month there is a standing charge, Just imagine Ha Ha. I do not know where there is a standing charge other than on electrical power, But WHICH will have the answer. WE can check who has shares in companies. But the name may not be the same. The Goverment could make a change to this tax. Good Luck

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I take it you are talking about the -Registration of Members Financial Interests for MP,s Albert ? -22May -1974 -amended -9th Feb. -2009 . which does include shares -category 9 and the long list of MP,s caught in non-disclosure over the years including off-shore countries like the Bahamas . Investment companies hide who are their clients but every so often , they get hacked and names come out. Standing charges are usually for the upkeep and maintenance of the delivery system whatever it is but what is progressively applied now by non generators (distributors ) are charges relating to administration which rise to a substantial amount -a “nice little earner ” as they say . You are asking a lot for Which to delve into an area that resists disclosure and upsets many in power I doubt they would ever do it and they would legally need to be 100 % provable in law. Why not ask a slightly easier question , why does international politics come into the price you pay for energy (usually more ) – now that is the right question.

Member
John paton says:
24 May 2017

Only one question should be asked when it comes to energy …. How much does it cost for the basic kWh electric and meter square volume gas ….. Generally power company will bamboozle people over the phone with facts and figures that really don’t mean anything …. Daily standing charges mean nothing compared to the price per kWh you use … Especially in winter ….

Member
Colin Smale says:
31 May 2017

I took the plunge, went on uSwitch to change my supplier and chose Green Star Energy, big mistake and now trying to reverse out of it. I wanted to switch both gas and electric and even though I spoke to them on the phone they ignored me and still did not include my gas supply. They just sent someone to read the electric meter but not the gas.
Now that I am registered with them it is impossible to get a reply on email, the ‘contact us’ on their web site wont open, no one answers the 0800 number and there is an extra charge if you ring their other number unless you are on a BT line which I am not.
NO TO GREEN STAR ENERGY! Plenty more fish in the sea.

Member
Janette Barr says:
13 June 2017

I also switched to Greenstar and had no problems.

Member
Margaret Roseweir says:
5 June 2017

Surely it is the daily charge that is important to compare with other companies as if we decide to try and save on our energy bills and turn our thermostat down etc. and there is a high daily charge nothing can be done about it so although some companies quote lower prices for energy they do sometimes charge a higher daily charge

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The tariffs on offer include different combinations of standing charges and unit charges. When comparing offers you need your approximate annual usage so you get a total cost to compare. If you are a very low user you can use a tariff with no daily charge (but relatively high unit costs), but if you are a high user you will be better off with a high standing charge and a lower unit charge. Whether or not people agree with the way tariffs are constructed, that is the situation now and to get the best deal you work with what you’ve got. A comparison site – I use Which?Switch – takes all this into account when you look for the best deal for your circumstances.

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@j964144156, The CMA have suggested that comparison websites do not need in future to show every available tariff, but perhaps only those that they can switch you to and receive a commission. Ofgem are considering this and due to rule on it in the next few weeks.

Does Which?Switch show every available tariff? Will that continue even if Ofgem rule it is not necessary?

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My concern with tariffs is that many fixed price ones may be artificially low, subsidised by standard variable tariffs. I think the fixed ones should be abolished and the svts reduced in price accordingly, then the need to switch between a large number of tariffs is avoided – just choose between suppliers.

Well, I asked the Department of Business, Energy & Industry Strategy about this. They tell me cross-subsidy is not allowed and the difference in cost is accounted for by administration savings for those on fixed price tariffs.

So I looked at each of 5 of the “big 6” tariffs – their cheapest svt and their cheapest fixed price, paid by monthly direct debit, for an average dual fuel consumer (3100 kWh electricity, 12500 kWh gas). Svts ranged in annual cost from £1122 to £1170; the corresponding fixed price tariffs ranged from £873 to £1037. The biggest difference for one supplier was £297 – 25% of the svt total bill. Ofgem tell us the average admin cost is 15.8% of the total bill. So somehow I am being asked to believe that not only is the whole admin cost saved, but another 10% as well if I choose their fixed price tariff!

As far as I can see there must be a cross subsidy. Perhaps Which? would like to pursue this?

I have written back to the Dept for BEIS to ask them to comment. I’ll report back (watch this space for a few months….. 🙂 )

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I know this is a big issue with you malcolm and I accept that so this might not appeal to you. My energy provider Co-op (MId-Counties ) sent me an offer of a two/three year deal at a fixed rate as they class me as a “loyal customer ” allowing me to change my contract without losing any money as it is not due up yet . I checked up on this and several small eco energy suppliers are doing the same , the Co-op being round about the middle in the range but the difference isn’t much on a yearly basis . Now the two year fixed deal would save me money but not the three year deal which would cost approx £148/year more –I went for the three year deal .Now you may think I am mad, senile , etc but that is not the case , as you know I am constantly checking out the International situation , I get constant emails, I spend time on US websites relating to world economics/shares/futures market a even though I dont own shares and all the economists dont see the US shale market as living up to its “30 year ” boast only into the 20,s as unlike , oil/gas wells which gradually diminish over the years shale wells fall drastically over a much shorter period . Now “the Donald ” has informed me of the “first ” official transport of shale gas to Europe , as you know its much dearer than Putin,s Russian gas but we are talking this great advertising feature called “Energy Security ” so as the UK strives to reduce cheaper Russian gas and strives to buy dearer US gas those who are realists like economists realise this and know in the future we will be paying a lot more for our fuel , although the UK media wont show it in that light but say – “we are being “Patriotic ” well yes , but to America not Britain who will benefit. I have names of economists (USA ) statements from futures market, long time projections , you name it . There will be a boom in the shale exports to the EU/UK from a US perspective and an out-flowing of UK consumer cash to the States . I dont blame the US its business to them I blame the UK Administration for making us pay for a very one-sided loyalty . Washinton Examiner- “first ever ” natural gas exports offer hedge against Russia -Energy Secretary Rick Perry . Also put OUR (US ) miners back to work -Corsa Coal Company ( approved by the President ) – first American corporation to open the first NEW coal mine in 6 years. -Daily Caller . The President pushing forward a major jobs agenda includes filling positions that do not require 4 year college degrees. America is looking after its own –and this country? Just got another indicator– US shale companies are complaining of the LOW price of shale gas exported to the EU and want it to rise substantially.

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Since the energy companies import vast quantities of energy-producing material it will continue to make sense for them to import the cheapest supplies that they can find and enter into long-term contracts. When the UK had abundant home-produced energy it could influence international prices or avoid imports altogether, but that is no longer the case. We can get by on renewables and nuclear when demand is low but suppliers don’t like fickle buyers so want a higher price for short-term supplies, hence we get locked into long-term year-round contracts that mean renewables become the balancing or top-up element rather than a part of the base-load.

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I take fixed price one year tariffs because they benefit me considerably duncan. But I don’t think the reasoning supports their pricing. I do urge people to use Which?Switch to find a deal because it is very easy to use and it works.

Incidentally I’ve asked Which? whether if Ofgem rules that not all tariffs need to be shown, whether Which?Switch would take advantage of this possible relaxation. I do hope not because whether or not they get a commission from a supplier, it is important to have a truly independent and comprehensive price comparison site. However I await a response – either from the Convo author or through the Which? member community forum…………………… 🙂

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“hence we get locked into long-term year-round contracts that mean renewables become the balancing or top-up element rather than a part of the base-load.”

John, whilst nuclear is excellent for base-load, I doubt that renewables are as good for that. Because wind and solar are uncertain sources of supply, it makes sense to backup those renewables with additional renewable sources, including hydro and biomass (e.g. wood pellet boilers) and also with storage batteries. In Wales, the CAT centre have been using this approach for several years – but it does require the integration of all of those diverse elements to work well.

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I totally agree, Derek. I include those other sources within the general category of renewables. While the wind is always blowing somewhere around the British Isles so can be harvested if there are enough turbines in every suitable place, that is obviously not true of the sun and back-up certainly is required. I am surprised we haven’t made more progress with tidal energy given the reasonable predictability of and repetition of tidal movement and a number of suitable locations for capturing it. We should also be looking at expanding hydro-electric generation in England where despite the general lack of mountainous terrain there must be some headwaters capable of producing power.

I am not quite sure about wood pellets. Is there not some concern over whether it is a truly sustainable resource unless extensive new planting takes place beyond current consumption levels? The regeneration cycle is quite lengthy. Because of stockpiling difficulties [product deterioration] there has to be a reliable continuous flow of wood pellets to the power stations which does not correspond with demand; it is therefore suited to baseload applications but still requires very careful management. Although it has been argued that coal is more efficient than wood pellets for conversion into energy, that is now irrelevant given that there will soon be no more coal-fired power stations in production for financial as well as environmental reasons.

Member
ian says:
21 June 2017

I recently moved from East Sussex where I was paying around 9.3p per kWhr. Now in North Wales I am paying 12.2p per kWhr with a small, online biller ( Let’s face it, it all comes from the same power stations! ) . That’s around 30% more for my electricity. The view from my home overlooks one of the biggest, most productive wind farm installations in the country and nearby is one of the biggest onshore gas terminals fed by a massive field below my feet ……………. and I pay more for energy!

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I’ve been in a complaint with British gas for 3 years as my energy shot up over 300%. The ombudsman got involved last year and a check meter fitted. Unfortunately British gas lost the meter readings when it commenced and when and when the engineer took it out. He told me my meter was faulty and needed replacing!! Anyway British gas said there’s nothing they can do even though it clearly shows a complete varied usage month to month. They haven’t let me switch suppliers as they pit my account on default. I recently asked ombudsman to reopen my case as I’m getting nowhere and British gas have increased my bill yet again to £129 a month energy I live in a one bedroom bungalow on my own. Last month they took £658 for energy usage for may. I’m completely stressed out with it all and can’t afford to pay it but my account isn’t in arrears and still on default so i can’t switch. I’ve received an email from ombudsman saying they are disappointed with British gas but because they’ve lost the information they need there is nothing they can do.
Please can someone help me… I don’t know where to turn now xxxx

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Carrie – I think a good place to start would be Citizens Advice. I am not sure whether Ofgem might be able to assist – possibly not because there is an Energy Ombudsman. Sometimes MP’s can put pressure on companies to deal with complaints properly. Weekend newspapers also have ‘readers’ problems’ columns on your sort of case where companies have treated customers badly [the one in the Daily Telegraph Your Money section on Saturdays seems to be effective for those they publish but it probably involves a long wait for action]. The money at stake is considerable – it could be worth getting legal advice but be careful about the costs and any terms and conditions; a court claim might galvanise BG’s mind.

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Back in March my electricity supplier Eon wrote to me about forthcoming price increases to my ‘Economy 10’ tariff. The day rate was to increase by 16% and the night rate by 22.5%. They gave a personal projection for the coming year which showed an increase overall in my bills of 19.5%. Is this a record? When I wrote to them enquiring why the huge increase and why the difference in the increases to day and night rates I was told ‘it was a business decision’ ! They did point out that they hadn’t increased prices for three years!! Being on an Economy 10 tariff (all electric with underfloor heating, total bill last year £2,600) I am very limited in choice of provider and unable to participate in ‘energy clubs’ and the like. Forgive me if I believe energy companies to be some of the worst examples of rip off merchants in this country and the sooner they are nationalised the better. Before anyone accuses me of being a socialist, my view is that a socialist, once they gain power, very quickly becomes a capitalist!

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That last line Tony – —-brilliant—and True , and I can prove it.