Money Mensch: Don't waste your energy on ... energy
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If you saw someone feeding twenty five £10 notes into an open fire to keep warm, would you stop them? It is a ludicrous waste of cash, yet across the nation people are doing just that to keep warm, unnecessarily putting the notes into gas and electricity companies' coffers.
Now is the perfect time to switch energy providers.
Last month the final five of the big six energy companies cut their prices. That means that if you do a price comparison then there's a level playing between the providers.
Gas and electricity companies are like sheep. When one bleats, the others follow. So if you switch as soon as one of them announces lower prices, you risk moving to a company that won't be the cheapest after the dust settles and they all alter prices.
Now the latest round of cuts seems to have ended, it is a good bet that it is a cracking time to compare. The savings are likely to be huge. Hidden price war. While recent gas and electricity price drops have been shouted about in the papers, at best they amount to an average cut of 9 per cent on gas and no cut on electricity for standard tariffs. That does make things cheaper, but most people can save well over £250 a year more.
That is because while standard tariffs remained constant for nine months, there was a regular punching through of new online tariffs - where you are billed by email - battling to be top of the comparison tables. That now means that, while one average usage on a standard tariff, you will typically now pay around £1,150 for gas and electricity on the cheapest online tariff you will pay less than £900.
How to switch
● The easiest way to find out who is cheapest is to use one of the Consumer Focus-approved comparison sites. Tell it where you live and give as much information as possible about your energy bills. Even if you have moved into a new house and don't have any bills, many will have the facility to give you an estimate if you put in some basic details. While the comparison sites aren't perfect, they make it much easier than trying yourself.
The easiest way to sort this out is online, plus that has the benefit that you can get cashback on top when you switch. This includes up to £30 for a dual fuel switch or even a crate of wine. Yet, to do this, you can't go direct to the comparison sites. Do that and you won't get any freebies.
For links, see www.moneysavingexpert.com/gas. Occasionally, even more cashback may be possible with a bit more work. Once you have found your cheapest provider, check its website to see if it has any direct cashback sign-up incentives.
And then try specialist cashback sites like Quidco.com or TopCashBack.com to see if they can offer you an incentive for that provider too. That said, cashback from cashback sites is never 100 per cent guaranteed.
For those who aren't online, many comparison sites also offer phone services which allow you to switch. Of course you still won't have access to the very cheapest online tariffs although you should still be able to save money. Examples include Energy Helpline (0800 074 0745), The Energy Shop (0800 330 7247) and uSwitch (0800 404 7908).
● Saving money on your energy bills isn't just about doing the comparisons. Who you use and how you pay can cut your bill substantially;
Don't assume dual fuel is the cheapest
● Logically getting your gas and electricity from the same supplier should be the cheapest way, and often it is. But not always, so while you are doing your comparisons, compare the cheapest dual fuel deal with the cheapest standalone suppliers for each fuel.
Switch to monthly direct debits
● Fixed direct debits, where you pay a set estimated amount each month will save you 5 to 10 per cent over any other method of payment. If you pay this way, ensure you do a meter reading every time you get a bill. It helps keep the bill more accurate. If they are under-billing, you can have big whack to pay off at the end of the year. If they are overbilling, then they have got your cash unfairly.
Avoid prepayment meters if you can
● While a government push means things are getting better, those on prepayment meters are hard done by compared to those on direct debits. If possible, switch to a billed meter. You may have to pay to get one but the savings are usually worth it. If not, some comparison sites allow those on a prepayment meter to compare and shift.
● If you are in financial hardship, some companies offer special cheaper tariffs that will help. However, don't assume these will be the cheapest. If you have the facility to be billed online, that is still generally the winner.
Grab £1000s in grants
● There are a vast range of grants available for improving home heating and energy Just go to the http://www.energysavingtrust.org.uk and use its energy grant search to see if you are eligible for anything.
Finally, use less energy
● Turn down the thermostat, make sure you've got loft insulation. Keep doors closed and use energy-saving light bulbs. If it's cold, put a jumper old rather than put the heating up.