At a time when the nation is fed up with sky-high energy bills, has next-to-no confidence in any of the large corporations, and with minimum wage jobs are on the rise, you would expect that consumers would be doing anything that they could to reduce the size of their bills. This doesn’t seem to be the case at all. If anything, people are coming up with any excuse to not change their consumption. The number one proven method of saving money on your energy bills is by switching the tariff that you’re currently on in favour of a cheaper one; however, huge numbers of people in the UK are trying to cling on to any flimsy reason not to spend 5 minutes switching their tariff, resulting in hundreds of pounds in savings. Let’s hear some of the reservations that people are having across the nation, along with their answers.
Will I really save hundreds of pounds?
This completely depends on how much you are currently paying for your gas and electricity. The average saving made by first time switchers is usually around £325 per year; however, if you use a lot of energy or your tariff is currently sky-high, you will most likely save even more than that, some saving up to £600 – 700 per year. You should note, however, that when an energy company advertises an amount you’re going to save, it is almost always incorrect. This amount can be both higher and lower than the real amount you’re going to save, it is just an average.
What if I get a fixed tariff, then move house?
Not a problem. It is true that a lot of fixed tariffs in Great Britain come with an exit fee for if you want to terminate your contract earlier than the agreed date; however, the majority of fixed contracts now come with the option of transferability. This means that if you want to move house, you can take your fixed contract with you and see the rest of the term out, paying the same amount in your new home. (Note: Prices may change slightly if you move to a different region, see question 4)
What happens if I get a fixed tariff then variable prices go down?
In the extremely unlikely that variable prices drop by a noticeable amount, it is even more unlikely that they will stay that way. We live in a world where everything goes up in price eventually. It is highly advisable to choose a fixed tariff as in the long run you will definitely save more money, even if for 6 months you’re paying more than on the average variable tariff (which never ever happens).
Why do prices change depending on what region you’re in?
Prices change depending on where you are in Great Britain due to three principal reasons:
- Low population often sees a price increase to compensate
- Energy is purchased in bulk from generation in advance, so if there’s a sudden surge in demand, prices are often increased
- Suppliers are subject to fees by the 14 local distribution networks, all with varying pricing structures.
Due to the reasons listed above, you may find that Npower prices in Leeds were cheaper than they are now in your new home in Suffolk, for example.
Will there be a gap in supply at any time throughout the process?
No, not at all. You are not changing anything to do with the actual electricity that comes to your home. You are still being supplied by your local distribution company; you are only changing the company that bills you for it.
Are smaller companies as good as the big six?
When it comes to the actual supply that you’ll receive, there is no difference at all. Each company that you can buy your gas and electricity from send their supply through exactly the same network, meaning regardless of whether you go with a big company, who generates some of the electricity themselves, you’ll still receive the same supply as your name, the only difference is, that the bigger companies will make larger profit margins from it. When you’re choosing a company to supply your energy, you should have two main thoughts in mind: price; and customer service. Obviously you want the cheapest possible tariff, but if there’s one for a couple of extra quid per year, but a considerably better customer service rating, always pick that option, you’ll thank yourself if you ever encounter any issues with your account.
This is completely helpful for me because I have my parent living in the UK, and they are mulling over if they are going to choose a switch or not. Thank you for sharing this one. 🙂
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