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March 6, 2009 6:58 pm
Households unhappy with their energy bills should consider moving to a different tariff now because “this is as good as it will get”.
Gas and electricity bills saw an average rise of more than £380 in 2008, leaving customers paying up to a third more. But subsequent heavy falls in wholesale gas and electricity prices led consumers to hope that they would see a significant reduction in their bills this year.
However, in spite of mounting pressure from the government, suppliers have so far cut bills by just 10 per cent on average, leading to an average household saving of just £60 – and consumers are being told not to bank on any further reductions being made later in the year.
Last week, Scottish Power became the fifth large energy company to cut its tariffs, leaving Npower as the last big provider yet to lower its bills.
At the start of April, Scottish Power customers will see their household bills drop by, on average, 10 per cent, matching similar cuts to energy bills from British Gas, Eon, Scottish and Southern Energy and EDF Energy.
If Npower does cut its bills, comparison site experts hold out little hope that the level of reduction will be significantly more than cuts made by its competitors.
Households that are still unhappy with their energy bills can move to a different tariff – but should look beyond the largest companies, as the big six are not the only energy providers to cut rates.
Ebico, a small not-for-profit energy supplier, has cut its electricity bills by 9 per cent and gas bills by 2.5 per cent, which it says will save its 50,000 customers £65 on average.
The company also offers a philanthropic deal to customers who pledge to reduce their energy consumption by 10 per cent over the next year. For every customer who agrees to lower energy usage, the company will spend £200 to cut the fuel bills of low-income households elsewhere in the UK.
While some green energy providers such as Ecotricity and Good Energy tend to charge slightly above average tariffs, reflecting the extra costs of generating green energy, other niche providers can offer relatively competitive rates, according to Uswitch.com, the price comparison site.
Small providers such as Ebico and First Utility pride themselves on offering deals that don’t charge customers over the odds.
First Utility uses smart meters – wireless transmitters that allow customers to monitor their gas and electricity usage. The meters cost £49 to install but could save customers 5 per cent a year, according to the Energy Saving Trust.
The best way to lower bills for gas and electricity is to switch to an online tariff and move to a dual fuel bill, where one supplier provides both gas and electricity, and pay monthly by direct debit. Industry experts say consumers can knock up to £350 off their annual bills through these changes alone. Households can cut costs further by reducing their level of energy consumption.
Switching to low-energy lightbulbs and remembering not to leave electrical equipment on standby can all make a significant difference to bills.
But the very cheapest deals are still be found from the UK’s largest energy suppliers.
The cheapest tariff available is still British Gas’s online Websaver 2 deal, a dual fuel deal that costs on average £1,055 a year.
Certain comparison sites will offer cashback deals to customers who switch supplier. Households that use Moneysupermarket.com can get £30 if they move provider and Energyhelpline pays customers £15 cashback.
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