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Energy bill gone down? See how to shave hundreds more off

There has been a buzz around some energy providers dropping their prices recently. But although this may put some money back into your pocket, there is a better way to make sure you’re getting the best deal possible for you.  

Scottish Power, SSE and E.ON have all cut, or announced plans to cut gas prices on their standard tariffs by just over 5%. Despite this many industry experts are unimpressed with the reductions, which will save the average home just £30 a year.

The truth is, that despite the cuts, picking a fixed price energy plan is usually a much cheaper option. According to energy regulator Ofgem, switching from a standard to a fixed plan could save you close to £200 per year.

Variable vs. fixed price energy tariffs

There are two types of energy tariff available: variable (also known as standard) and fixed.

Sign up to a fixed energy tariff and you’ll pay the same rates for the duration of the contract. That means that if you pick a one year deal, during that time the price you pay for energy units won’t change.  However, that doesn’t mean your bill will stay the same no matter how much energy you use!

Standard, or variable tariffs, don’t have fixed unit rates. You’ll pay whatever your energy supplier has worked out as the market price. That means the unit price will rise and fall, in line with international energy markets. These plans usually work out much more expensive than the cheapest fixed price deals.

One of the reasons the recent price cuts have failed to impress is that they are far from matching some of the most competitive fixed price deals on the market.

So how much will switching save me?

It’s easy to find out how much you can save by switching energy provider.

  • The first step is to grab a recent energy bill and pick a few price comparison websites. It’s important that you use more than one, because they don’t all show the same deals.
  • Once you’re on a price comparison site, type in your details and run a price comparison. You should then be shown a list of energy plans available and given an estimate of how much you might save.
  • Once you’ve chosen a new plan, your new supplier will do most of the leg work. They’ll contact your old supplier and keep you up to date with the process. It shouldn’t take more than 17 days and you have 14 days to change your mind and cancel the switch.

 

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  • Nehad Zaki (Mr) / 22 February 2016

    Thank you for the information provided.

  • Raymond Dalchow / 22 February 2016

    If each of the energy companies were to publish how much per Kw cost it would be easier to pick which company to go with.

  • Greenman / 21 February 2016

    Sensible advice but beware, energy companies load the prices for fixed rate deals above those of variable rates to cover any projected losses if the wholesale price of energy rises. I've just recently come to the end of a three year fixed rate deal where costs were higher than almost every other deal right until the end. The part most loaded was the 'standing charge', the amount collected for the distribution network operator who look after the wires and maintain the substations, a fixed daily charge no amount of economic use can reduce and much higher than the equivalent charged on their standard variable rates. In future in light of unstable and fast moving markets I'm thinking of signing for short term cheapest deals so I can soon take advantage of changing market pricing and conditions.

  • Alan Bell / 7 February 2016

    Like many people living in rural areas, we are completely reliant on LPG (Calor in our case) for our main fuel - central heating and cooking hob, not oven. We therefore appear to be excluded from "dual fuel' deals. Also, at this point, there has been no reduction in LPG retail prices despite the precipitous fall in the suppliers' purchase cost.

    For a three bedroom house we're currently paying over £1500 for gas, which we use carefully and supplement with an all-fuel stove, another expense.

    Have you any information or suggestions which might help?