THE UK ENERGY MARKET

Are you paying too much for gas and electricity?

The UK energy market has been open to competition for several years now and as a result wholesale energy prices have fallen quite considerably. These falls in wholesale prices are reflected in the prices that are on offer to both domestic and business customers. Thousands of individuals and businesses across the UK have made substantial savings over the last few years through new agreements with their existing energy suppliers or by switching to new suppliers. Savings of up to 25%, and sometimes more, are available to Broadstone residents and businesses alike. If you haven't taken action as yet we give you some tips on how to bring your energy costs down.

Where to start?

There are a number of steps you can take towards bringing your energy costs down. The first step is to speak to your existing gas and electricity suppliers and find out if they are able to reduce your unit rates. If you suggest that you may choose to switch suppliers if they cannot reduce their rates they may be more receptive! You should also enquire about "dual fuel" deals. Most domestic energy suppliers now supply both gas and electricity under a "dual fuel" deal. Some go further still and provide a multi-utility offering that includes telecommunications. Under these deals there are very often sizeable savings to be made.

If your current energy suppliers are not able to offer any flexibility then it is definitely worth considering switching your supplies to an alternative supplier. There are many suppliers to choose from, some names you will recognise and some new names in the market. By placing both electricity and gas with one supplier it will give a reduced cost but also reduced administration. More often than not you can pay for both commodities under one bill or by one direct debit and any queries will go to the same number where they can answer questions about both commodities. With this in mind it is worth shopping around and comparing prices.

Payment terms

Suppliers usually offer a variety of payment options to customers, varying in frequency from weekly to quarterly options and paying by cash, postal order, cheque, direct debit, or prepayment meter. Suppliers will tell you about all the payment options available to you so that you can make the most appropriate choice.

It is worth noting that some payment methods may be cheaper than others. For example, it is usually cheaper to pay your fuel bills by monthly direct debit, than to pay by cheque on a quarterly basis. Different tariffs are offered to different consumers according to their choice of payment method and their circumstances.

When comparing tariffs you must bear in mind that some suppliers add a standing charge to their bills and others do not. Those companies that do not add a standing charge are likely to offer a higher unit price.

How do I go about changing supplier?

Once you have selected a supplier that meets your needs and offers a competitive price your are ready to change supplier. The process is relatively simple and doesn't require a great deal of input from the customer, the suppliers handle the changeover.

1. Contact your selected supplier and agree a contract.
2. Give your old supplier 28 days notice that you are changing to a new supplier, initially by telephone followed up with written confirmation. If you do not tell your old supplier that you are changing, this can disrupt or delay your transfer to the new supplier.
3. Pay any outstanding bills owing to your existing supplier. If you do not, they may prevent you from transferring.
4. Take a meter reading on the day you change supplier. If your old supplier does not use it to workout your final bill, or your new supplier does not use it as the starting point for your first bill, let them know the meter reading you have taken.

Once the contract is agreed, the transfer process should take about six weeks to complete and your new supplier will keep you informed about how your transfer is being progressed. While there will inevitably be cases where things don't quite go to plan, as with any product or service, independent research shows that 93% of customers choosing to switch supplier found the process easy.

How do I know that a supplier will provide a good level of service?

A guide to the level of service that you might receive from a new supplier is the number of complaints they receive. The energy industry body energywatch can provide details of the amount and types of complaints each supplier has received from consumers. These complaints are divided into three main areas; customers accounts, customer transfers and direct selling; energywatch is the independent gas and electricity consumer watchdog set up to be an advocate for consumers in the gas and electricity markets.

Beware the doorstep salesman!

With the energy market ever more competitive companies are pushing harder than ever to bring in new customers. One of the methods employed is the doorstep sale, which has been heavily criticised. Three in every five people are approached by doorstep salesmen and energywatch reports that customers have been misled, intimidated into signing contracts, had their signatures forged and pressunsed into making decisions. One must always bear in mind that in order for a contract to be completed it must be signed. If you are not entirely sure of what you are being asked to sign do not sign it. It is likely to be a supply contract. While most doorstep salesmen do not involve themselves in the malpractices mentioned above it is still essential to be on your guard.

Good luck!

If you choose to switch supplier the infrastructure does not change. The only circumstance in which you could have your supply disconnected is if you do not pay your bills! Some suppliers have been known to have problems with sending out regular bills so if this happens ensure that you put money aside for the time when the bill finally arrives.

If you are connected to the internet you can access a wealth of information on how to choose and change your energy supplier at www.energywatch.org.uk . You will also find a range of other useful consumer information. You will also be able to find a list of licensed electricity suppliers. If you do not have internet access you can call energywatch on 0845 906 0708.

If you are already having problems or are concerned that problems may arise I welcome any questions, comments or concerns in writing via the Broadstone Residents Association or via email to : waynemitchell85@hotmail.com

Wayne Mitchell has worked in the energy industry for a number of years now and has worked in commercial roles in both gas and electricity retail.

Archive Summer 2002 | next

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