With the energy price cap rising again, a consumer expert has revealed six common mistakes that could leave households paying more than they need to – from missing the end of a fixed deal to relying on estimated usage.
A consumer champion has revealed six common energy bill mistakes amid July’s price cap rise. Sarah Ingrams from Which? says more than 10 years of research and feedback from thousands of energy customers has shaped the way she deals with energy bills.
The energy price cap, which is the maximum amount suppliers can charge for each unit of gas and electricity, jumped 13% on July 1st.
Sarah says that while you can escape the rising price cap by switching to a fixed-rate tariff there are six other pitfalls that can lead you to pay over the odds.
Forgetting when your fixed deal finishes:
Sarah says fixed energy deals are likely to be a year, 18 months or two years long and when that ends you’re automatically switched to the supplier’s default tariff.
The rates for these are determined by the energy price cap that changes every three months and it’s expected to remain as high in October too.
Sarah says suppliers should send a reminder that your tariff is ending 49 days before it does but you can check your end date in advance on their app, online or on a statement. She says you can switch without paying an exit fee in the last 49 days of your tariff.
Relying on ‘average’ quotes:
Sarah says that energy suppliers and price comparison websites often give you the option to base an estimated price on low, medium or high usages. While this feels easier than inputting your actual usage Sarah warns this is likely not to match your real circumstances.
She says energy regulator Ofgem, who set the averages, have recently lowered the amount of gas and electricity in each scenario so quotes may look lower than last time. The consumer champion says you can find your actual usage on your company’s app, online account or statement to get a clearer idea of what you could be paying when starting a new deal.
Believing bigger is better:
Ofgem say around 92 per cent of households are supplied by British Gas, Octopus Energy, EDF Energy, E.on Next, , Ovo Energy and Scottish Power. Sarah says Which? research concludes there are big differences between their customer service, and whether customers consider them to be ‘good value for money’.
Octopus Energy is a Which? recommended provider but some of the other big names are said to ‘sit at the bottom of the table’.
This means bigger isn’t always better so it’s important to consider smaller suppliers to make sure you’re getting the best deal and customer service available.
Being convinced by switch rewards you don’t need:
Sarah acknowledges it’s easy to be tempted by rewards for switching suppliers but warns they’re ‘not always worth your money or attention’. She uses the example of a tariff that includes boiler cover and explains it’s important to work out if you’ve already got insurance that covers this or if it’s cheaper to buy it separately.
Some tariffs will reward you or charge you differently for using or saving energy at certain times but it’s important to consider if you’ll be able to work to that schedule or not.
Not reading the terms and conditions:
Sarah says she understands it might be boring but claims reading contracts’ small print is essential. She notes how energy suppliers are great at promoting the best tariff features but are ‘less likely to shout about the downsides’.
She warns customers to check what exit fees are, what the length of the tariff is, whether the direct debit is a fixed amount or not, and whether you’re charged more for using energy at certain times.
There’s also a Warm Home Discount scheme that they may or may be included in and whether solar customers would have access to preferential rates.
Forgetting to take a meter reading:
Sarah says your smart meter should send meter readings to the supplier automatically, ranging from monthly or even every half hour. However if you don’t have one Sarah says it’s important to submit a reading every month as it ‘helps build an accurate picture’ of your usage.
She adds you should check your account to make sure your readings are registering and any marked as ‘E’ or ‘estimate’ means something isn’t working correctly.
