These days it's pretty easy to shop around energy suppliers to find a cheaper deal and given the current price of gas and electricity, it is certainly worth doing. Here is what you need to know in order to look for a better energy deal.
Why should I bother switching?
Quite simply, to save money.
The various energy suppliers publish a whole raft of different prices, so even though the prices they publish nationwide might seem the cheapest, they might not be the cheapest for you.
That is, even though we have had nationwide suppliers now for nigh on 20 years, prices still vary from postcode to postcode, so you may be paying more than someone a few miles away, even if they have the same supplier.
It is also worth remembering that the energy companies have price bands in place which are based on your usage patterns. If their cheap prices are not aimed at people that use energy in much the same way that you do, then you could end up paying more than you need to.
It takes no time at all to compare energy prices, so even if you don’t end up switching, at least you will know that you already have a contract that is suited to your circumstances.
How much could I save by switching?
A lot depends on how much you pay for energy now, and how much you use. However, you could save as much as £250 a year – or more if you switch both electricity and gas.
How do I go about switching?
First and foremost, remember that switching is relatively easy. A recent government investigation found that 90% of customers who switched their gas and electricity supplier felt the process was easy and simple. This process takes you through three steps:
Step 1: Your current situation
You will need to gather some details on your current supplier, contract and bills. Find out:
- The name of your current supplier and the energy tariff you pay – this information should be on your bills
- If you are on a fixed or capped price energy deal, find out if you would have to pay any kind of penalty to get out of the deal. If you do have to pay one, you will need to factor the cost into any decision as to whether you switch suppliers. You should be able to find this information by calling your supplier – again, the number will be on your bill
- How much you normally pay, either by checking your direct debit amounts, or looking at your most recent bills.
Step 2: Compare the suppliers
The next thing to do is to look at all the other deals on offer. It is then up to you to pick the deal that you like the look of, and which makes financial sense for you.
Consider issues like:
- Tariff or price per unit of energy, and make sure prices quoted include VAT
- Are there any special discounts or incentives? If there are discounts, what happens when the discount period ends?
- Are there any hidden or extra charges? Read the detail on each option carefully, rather than simply focusing on the overall saving figure
- What are the payment options? Make sure the deal you choose suits you in terms of how you pay and how often
Step 3: Make the switch
Once you are happy that switching is right for you, and that you have found a better deal, it is time to switch. This is what you need to do:
- Contact your chosen new supplier and apply to switch your gas and or electricity supply
- You will be sent a contract to check and sign, which will start the transfer process.
- Let your old supplier know that you are switching – you will need to give them 28 days notice in most cases – though remember fixed and capped rates might have different cancellation terms and early cancellation penalties so it's important to check
- Pay any outstanding bills issued by your old supplier, then cancel any direct debits you have in place
- Read your meter on the day specified by your new supplier, so their records can be updated
How long does it take to switch?
On average, it takes about six weeks to get a new energy supplier in place, including the 28 days notice usually required by your current supplier.
What if I change my mind after I switch?
Don’t panic. There are new rules to protect you in these circumstances. You will have seven days to cancel any new contract (from the date you receive written confirmation that your contract has been set up).
