It's the piece of paper that your energy provider doesn't want to send to you. Here's how to use it to your advantage!
Sometime between July and December 2010 you will receive your first Annual Energy Statement from your gas and/or electricity supplier.
It's not a bill so you don't need to do anything.
However, if you're smart you'll take advantage of the information the statement contains and use it to get the best deal possible on your energy supply - it could mean significant savings!
What is an annual energy statement?
Your annual gas and electricity energy statements will detail everything you need to know about your current energy tariff, usage and supply in order to shop around, compare energy tariffs in a meaningful way and find out whether you could cut your energy bills by moving to a different energy deal or supplier.
Annual energy statements were introduced by market regulator Ofgem for this very reason: to make it easier for consumers to work out whether they're getting the best deal from their energy supplier, and to take the hassle out of switching.
So use the information your energy statement contains to your advantage; it could help you to save hundreds of pounds a year on your energy bills so it's not a piece of paper you should file away without doing something with!
What does it tell me?
On a basic level your annual energy statement informs you how much energy you've used over the past year, how much this has cost you, and what you can expect to pay next year if your usage remains roughly the same and prices don't go up. However, it's the finer details that hold the key to cheaper energy bills.
There are certain pieces of information that your annual energy statement must contain including:
Provider name:
The name of the company who provides your gas and/or electricity supply.
Tariff:
The energy tariff you're on dictates the cost per unit of your gas and electricity. Energy suppliers make life confusing by giving their tariffs very similar names, so knowing exactly which tariff you're on is important when it comes to shopping around for a better deal.
Meter Point Reference Number:
This is a unique code used by energy suppliers to identify a property's gas supply.
If your Meter Point Reference Number is 10 digits long and begins with the number 74 or 75 it means that an Independent Gas Transporter supplies gas to your home. This has implications when it comes to changing supplier as you may need to pay a release fee of around £40 when you switch. Despite this it is still worth shopping around as you may be able recoup this cost several times over by moving to a different deal.
Electricity supply number:
This is a unique code that identifies your home's electricity supply.
Amount of energy used in the last 12 months:
This will be expressed in Kw/h (kilowatt hours) and stated for both gas and electricity if you have a dual fuel supply.
Your statement should indicate whether this calculation has been based on estimated or accurate meter readings. If it has been based on estimates then you should submit meter readings to your energy supplier as soon as possible. You'll then be sent an updated annual statement based on these accurate figures which will enable you to make comparisons based on your actual usage.
Cost of energy used in the last 12 months:
This is the actual amount that you've paid for your energy over the last 12 months, providing you have been with the supplier for this length of time. If you have switched supplier in the last 12 months your annual statement will only show your usage history with the company that provides your energy now.
Estimated cost of energy for the next 12 months:
This is based on the assumption that your energy usage will be the same as this year, and that energy prices won't rise over the next 12 months. As such this should be used as an indicator of cost and not a guaranteed quote.
Discounts:
Details of any discounts you're currently benefiting from will be listed on your annual energy statement, as well as any that you are eligible to take advantage of if you stayed with the same provider but switched to a different payment method, or to a different tariff. For instance, if you usually pay by cheque but could save by setting up a direct debit, this will be indicted.
Terms and conditions:
The statement should detail the end dates of any fixed term tariff you're tied in to, and the charges you'd incur for leaving early, as well as any other relevant terms and conditions applied to your account.
A reminder that you can switch(!):
Your annual energy statement must contain a reminder that you're able to switch suppliers and provide information about how you can do this - so take note!
The way that energy suppliers present this information differs and you may need to scrutinise the statement in order to find the relevant information, but it will be there - it has to be in order to remain Ofgem complaint.
What should I do?
When you receive your annual energy statement you should firstly double check that your usage is based on accurate meter readings - either those you've submitted yourself, or readings completed by the company themselves.
Once you're happy that your annual statement is an accurate reflection of your energy usage over the past year, you're in a position to start shopping around. Keep your annual energy statement to hand when you do this as it will provide you with all the information you need to accurately compare tariffs and work out whether you should switch energy supplier.
If you're tied into a fixed term deal you should note the end date and see how much you'll be charged for leaving early. It may be the case that you'll save more than enough to cover this cost by moving to a tariff with a different provider so it's definitely worth checking.
Read this article to find out how to switch energy suppliers and save.
