What to Consider Before Switching Energy Suppliers
The ‘big six’ are commonly known as British Gas, EDF Energy, E.ON, Npower, Scottish Power and SSE. Over the last few years the UK has seen a change in the domestic energy market, with an increasing number of customers switching suppliers and more energy suppliers to choose from. To understand if there are savings and benefits to be made through switching it’s best to understand your current, tariff, usage, ‘perks’ and potential exit fees first. Then you can weigh up any potential benefits.
Your current tariff
- Since the supplier 4 tariff maximum was lifted in 2016 there are now many tariffs to choose from, the most common being: a fixed rate tariff and a variable tariff. A fixed rate tariff will charge you set prices, usually for 12-24 months. Whereas a variable tariff can fluctuate according to the market. For example, if the wholesale cost of electricity rises this will be reflected in your bills.
- When choosing a fixed rate tariff, make a calendar reminder in your phone or laptop to notify you 1 month before the contract runs out so you can shop for the best deals before it runs out. If your contract ends you will get put onto a default standard variable tariff which is typically the most expensive.
- Dual tariffs – if your property gets gas and electricity this may suit best. Typically suppliers will offer discounts on these to retain customers and business but you should also check if you can find any cheaper rates on a separate basis.
Your current usage
- Your supplier will be able to see your energy use patterns from meter readings and make recommendations on what tariffs may suit your usage best. New suppliers can also offer this if you know your usage information (which can be found on your latest bill, or will be estimated based on standard consumption figures).
- The best thing is to check your printed bills or online account and check your current tariffs and how much you are currently paying per kWh to see if there are savings to be made. A switching site can do this comparison for you.
Current supplier perks
- It’s worth checking if your current supplier offers the Warm Home Discount or the Priority services register. These are both useful for vulnerable households and not all suppliers are obligated to offer these services.
Current exit fees
- This is where you would be charged if you want to leave the contract early. Ending as normal has no extra costs.
- If you are on the default, standard variable tariff there are typically no exit fees.
- As a general rule of thumb the cheaper your plan is the higher your exit fees may be.
- Some suppliers may waive the exit fee if you are moving to another tariff within the same company if they would otherwise lose you.
- Things which are usually important to consider are call wait times, complaints handling, transparency and bill clarity.
- Which conducted a survey of over 8,000 households from 35 different suppliers in September 2019 to find how suppliers rated on such topics. You can view the results here.
- You can see scores on sites like Trustpilot, which also lets you search for best green supplier etc. This can be helpful for ‘newer’ suppliers, for example Bulb has over 37,000 reviews gaining an impressive score of 4.8 out of 5. Similarly Octopus has over 25,000 reviews on Trustpilot and also a score of 4.8.
Environmental & Social Responsibility
- Beyond how a supplier treats us we can consider how they treat the environment, their staff and local communities. It might be worth checking out your supplier’s commitments to support more vulnerable households. Additionally check their environmental approach, some suppliers will offer a green tariff and some suppliers are only green.
Paper or paperless
- Most suppliers now offer both. Some supplies can offer a cheaper online i.e paperless tariff as this reduces printing and postage costs. It also cuts carbon emissions. Some new suppliers such as Pure Planet only offer online services.
‘Perks’ of larger suppliers
- Some larger suppliers are able to offer ‘free’ gadgets on sign-up to their tariffs. Typically smart thermostats and plugs.
- Some larger suppliers offer boiler cover too and you may want your boiler cover and energy supplier to be the same company.
- Not all suppliers are obligated to offer the Warm Home Discount, to check which suppliers offer this click here. Check if this is an important factor for your switch.
Sustainable business growth
- Scalability is key here, if the customer base increases quickly there will need to be customer operations support to handle this. Ofgem toughened up their requirements to trade in June 2019, meaning future suppliers had to show more thorough evidence of future funding and also customer service plans. These were introduced to try to prevent new suppliers failing. For peace of mind if your supplier does fail, Ofgem acts as a safety net by; protecting customers energy credit balance, ensuring continued energy supply and covering customer service aspects. Read more on what happens if your supplier stops trading here.
- Switching to a cheaper supplier or tariff can save you money, but to reduce your bills further and for the environment we should all try to save energy where possible. Read our energy saving tips for more!
- If you are on the Priority Services register you will need to re-register with your new supplier.
Considering switching now?
Visit uSwitch to get started!
By Louise Hyde