Regulator Ofgem has now unveiled proposals to make suppliers show customers the cheapest tariffs. Yet consumer experts still believe homeowners should move to fixed-rate energy deals as soon as possible. Earlier this week, ScottishPower became the third energy supplier in four days to hike its prices. Experts suggest energy prices will keep going up so fixing your costs for up to two winters is well worth it.
One of the ways people can reduce their energy bills is by switching suppliers. Yet, according to research by Citizens Advice Scotland, it is the thing that consumers are least likely to do, with just 14% of Scots saying they had changed to another energy supplier in order to bring their costs down. Many more (43%) said they had stopped having the heating on so much instead.
ScottishPower was one of the most expensive providers before the latest round of increases, according to Scott Mowbray, energy spokesman for Moneysupermarket.com. He urges consumers to take action right away. "This is a real shout-out to anyone who has never changed energy provider to do so now."
Even if you have changed, he says it is worth checking annually that you are still on the best deal.
Tom Lyon, energy expert at Uswitch.com, also points out: "It is not only about switching supplier, it is also about being on the right tariff. The worst hit by energy price increases are those who are still on the standard tariff, still paying by cash or cheque, and still take their gas and electricity from different suppliers. By switching to paying by direct debit, using the same supplier for both and going online if possible, you will get a much better deal."
ScottishPower's quarterly cash or cheque customers will face a new average annual dual fuel bill of £1368. They could save nearly £300 a year by switching to a different supplier's fixed-rate deal and paying by direct debit. Kate Rose, head of energy at Confused.com, says: "The current best buy fixed energy tariff is from First Utility, iSave Fixed v4 with an average cost of £1087 for customers paying by monthly direct debit."
However, fixed-rate deals are limited, so consumers are being urged not to delay.
Mr Lyon adds: "What is attractive about the fixed-rate deals available at present is that you do not have to pay much of a premium for them and some are available without exit penalties so if you found a better deal available before the end of the fixed-rate period, you could switch."
Nowadays, if you phone your existing energy suppliers, it is obliged to tell you if you could get a cheaper deal from the firm. However, the easiest way of finding the cheapest tariff is to use a comparison service that has been vetted by Consumer Choice, which means the service must provide you with details of all deals.
Make sure you have your latest bill to hand so the comparison can be made based on how much energy you normally use, but even if you don't have the bill you should be able to get quotes based on the type of property you live in. Most switching services operate through the internet but some offer a telephone service such as uSwitch.com (0800 051 5493) and Which? Switch (01992 822 867).
The comparison service will give you details of what is available and if you decide to switch it will inform the old and new suppliers on your behalf. All you will have to do is sign some forms and supply some meter readings. There will be no interruption in your gas or electricity supply. Indeed, you won't notice any difference apart from the fact that your future bills will come from a different company.
Mr Mowbray believes the current EDF Energy fixed-rate deal is the most attractive at present. He says "The EDF fixed deal is a no brainer. It runs until May 2014, so your costs are fixed for two whole winters and there is no cancellation fee. But consumers shouldn't wait around as it may be withdrawn."
He says the reason energy suppliers can afford to offer the deals is because so few consumers have taken advantage of them in the past. "Most people are still on standard tariffs paying over the odds."
Energy firms are blaming increased wholesale gas costs, distribution costs and Government policies. ScottishPower says rising costs include an 11% increase in the cost of transporting gas and electricity to homes, and a 34% increase in the cost of delivering Government schemes including energy efficiency programmes.
Pressure on providers to improve energy efficiency means many are offering deals on insulation. ScottishPower is offering free loft and cavity wall insulation not just to its customers but to anyone. You can find out if your property is suitable with a free survey. The offer runs until November 30.
CASE STUDY
TRACEY O'Lone, 49, a sales adviser for a property company, has recently managed to shave £110 off her annual energy bill by switching suppliers using a comparison service.
Ms O'Lone, from Glasgow, says it is not the first time she has switched but her previous experience had been less positive. She explains: "Four or five years ago a girl came to the door suggesting that I switch to Scottish Hydro which I did because it was raining and I felt sorry for her. But it ended up costing me more."
Her latest switch two weeks ago was via GoCompare.com. She said: "I had my latest bills to refer to so I was able to put in my exact energy usage and it came up with a list of alternatives. I chose a fixed-rate deal with British Gas – before they announced their latest increase – which lasts until November 2013.
"I think a lot of people are worried changing supplier will be a lot of hassle but it really couldn't have been easier."
