With this winter tipped to being as cold, if not colder, than last year and with all of the major energy companies destined to hike up charges again before December, its no wonder that people are already worrying about gas and electricity payments. Some are even cutting down on the amount of heating they use, I know I am, I have not even put my heating on yet and before prices started rising I would think nothing of sticking the fire on but not anymore. Many people think that switching energy suppliers is the way to go but is it really? Should you stay with your long term provider or go with one who has a fixed rate tariff? Fixing your bills could help protect you from further price hikes. Recently in the news it was announced that price rises on gas and electricity bills this summer meant that suppliers are now making £125 of profit from each customer each year, this is up from £15 in June, Ofgem reports. So loyalty to one energy supplier is a waste of time and energy (forgive the pun) but how easy is it to change and who are the cheapest?
Should You Switch?
Energy experts tell us that by switching energy suppliers you could save up to £310 a year, but you should only switch if you if have never switched provider before and are not already signed up to a dual fuel, online tariff paying by direct debit, this is because you are likely to be getting the best deal available anyway and the savings will be minimal and not worth the hassle. And remember, some companies have tariffs which have a two tier system. This is where the first amount of fuel you use is charged at a higher rate and is then reduced for energy used after that amount. As it is complicated to work out yourself, it is better to call the company as ask them directly whether they use this system, as it will not benefit low energy users, but if you use high amounts then it may be a good tariff for you to be on.
Do You Fix Or Not?
With the current climate as it is, many experts are telling us we should fix our bills with a fixed price tariff but if you do you will have to pay a premium. If you go for this type of deal, the tariff will fix the rate you pay for a period, say typically for 18 months, but you pay slightly more than the cheapest deals to buy that security of mind and pocket. Although you do not have a guarantee that fixing your tariff is the best deal in the long run, as the current trend suggests, prices have continually risen in the past 12 months and look set to carry on. And you can plan your bills more effectively if you know exactly what they are going to be. If you do not want to fix your tariff, go for an online plan with dual fuel if you have never switched before, these are the most competitively priced and will save you the most money.
Who Is The Cheapest?
This is typically hard to work out with a comparison site as you have to put in your post code and then they will give you your cheapest rates according to where you live. However, generally speaking, the cheapest online tariff is currently First Utility’s iSave Dual Fuel, costing £1,032 per year for a typical household user. Next is Scottish Power’s Online Energy Saver 16, costing £1,045 per year for a typical household, is the cheapest of the ‘big six’ suppliers. The cheapest fixed tariff is OVO Energy’s New Fixed Energy deal, which is for 12 months from going live, costing £1,050. There is a £60 cancellation fee if you leave before 12 months. Other low-cost energy providers are EDF Energy, nPower and EquiDual.
So remember, if you have switched before you are better off staying where you are if you are already on a dual, online paying by direct debit. If not, check out a fixed tariff by keeping an eye on the news and energy prices. But always go for a dual fuel (gas and electricity) where you pay by direct debit and ask about the two tier tariff is you are a low energy user.