In response to the volley of energy price rises hitting us where it hurts, Prime Minister David Cameron advised consumers to shop around and switch suppliers, Labour’s Ed Miliband promised to freeze energy prices, and Nick Clegg, well, hasn’t said anything helpful – although Lib Dem Energy Secretary Ed Davey suggested people put on an extra jumper. Former Prime Minister John Major suggested the government slaps a windfall tax on operators’ profits – worthy, perhaps, but not exactly an immediate solution. Winter being almost on our doorsteps. Moneysavingexpert’s Martin Lewis says the best way to ensure you pay less for energy when prices are rising is to find a good fixed rate deal.
“If we all fixed we would screw their market model. That is the way to get your own back on the big companies,” he recently told the Daily Mirror. “Someone with a bill around £1,400 before the hikes could save £250 by going for an 18-month fix and a guarantee of no hikes. Or they could save £80 a year and lock in for four winters.”
So far, four of the major six energy suppliers have announced price rises. SSE (Scottish & Southern Electric) perhaps employed a clever strategy by getting their 8.2% rise in first. By comparison, British Gas’s 9.2% rise, npower’s 10.4%, and Scottish Power’s 8.6% look much worse.
Two of the big six providers have yet to make price announcements – EDF and Eon.
Some savvy householders have been switching for years and the process has become second nature to them, happily navigating the final readings and fielding calls from suppliers asking do you really want to go and what did we do? The answer’s obvious!
Comparing prices online and switching energy tariffs has become much easier – use an online price comparison website such as energy helpline.
You will come across fixed-price tariffs to avoid annual price rises, although there can be conditions and early exit penalties with these (energy helpline.com takes these into account when comparing for you). But even with exit penalties it may still pay you to switch.
Even if you don’t know exactly what you spent each year you can still switch, so you don’t need to have all your bills handy. You will need to have at least one bill with you though so that you can provide your energy supplier or MPAN number.
While many comparison results will offer savings if you switch to monthly direct debit payments you can also opt to keep your quarterly payments and paying on receipt of bill, and still make savings.
Another tip is to make sure you click on the tariff details attached to price comparison results to make sure they apply to your area, for example, or whether they mostly benefit prepayment customers.
As well as the big six providers there are a host of other and newer suppliers out there. Checking customer service ratings will help in your choice.
Online is the most effective and simple way to switch suppliers. Cold calling is the worst – for example, SSE was this year fined £10.5m by industry regulator Ofgem for mis-selling by telephone, on doorsteps and in-stores and had to publicly apologise.
Of course, many householders may not have access to the web and if you have any family or neighbours in that situation perhaps now is a time to think about helping them switch energy suppliers.
Mark Todd, energyhelpline co-founder, said: “Customers need to understand that if you want cheap energy you need to compare prices and fix, and you need to do it now.”
Bosses from the big six energy firms will this week (October 29) give evidence about recent price increases to MPs on the energy and climate change committee along with other smaller energy suppliers.
Sir Robert Smith, the Liberal Democrat acting chairman of the committee, said the session would explore a range of issues, including reasons and justification behind recent energy price rises, the difference of pricing policies between energy suppliers, and how the transparency of energy company profits can be improved.