I’ve been reading a lot in the media about switching energy suppliers, and how the most loyal consumers (ie. those who don’t change) are paying as much as £300 a year more than they should be.
In 2014, the average dual fuel bill in the UK was a staggering £1,344 (source).
In the cottage, we ‘inherited’ Economy 7 (even though it wasn’t applicable to our usage and there were no night storage heaters) and with it two meters and two tariffs. The only thing running that applied to the cheaper rate was our freezer and so one of the first things we did was have the two meters taken out and replaced with a single standard issue.
Following a disagreement with the electricity company we were with about overcharging and estimates based on the previous owners, I eventually got a refund of £15 (not bad since I was only asking for £10, it was the principle) and took to reading my meter every day. Thus on a heavy day, I knew where our usage applied, and could calculate that oven cooking, showers and doing the weekly wash would each take a Kwh, costing us an extra (wait for it……..) 18p** a time.
We paid by monthly direct debit, and most years ran up a credit balance. Carried over to the next year, this grew until the electricity company refunded our bank account with £108. Very nice. We subsequently had £52 and £76 refunded in later years.
Note (i) :
You may wonder why we simply didn’t reduce our monthly payment. We had budgeted for this amount, whereas if we reduced it and prices went up, we may not be able to cover any increase. Best to pay over the odds and not have the immediate worry.
What is so amusing about this extra £300 a year is that our annual bill was never this high to start with. Mind you, most households now are on dual fuel tariffs, as there is no such thing as individual electricity or gas companies, just
Fat Cats ‘Energy Suppliers’ who provide both Gas and Electricity to their customers.
Of course in business, one has to make a profit, and how else but at the expense of Joe Public for a necessary commodity like heating and cooking.
But, with the information available on the internet through comparison sites, it may seem odd that people are preferring to stick with the Devil they know rather than change to save money.
I bookmarked the relevant page and every few months would check it out to make sure I was getting the best deal for our circumstances, and as there was no mains gas at all in our village, a dual fuel package didn’t apply. By punching in our annual usage (not such a daft idea reading the meter every day then) and current supplier, the system brought up a list of similar or competitive deals with a little tick box for ‘I want this tariff’ should I wish to switch.
As things turned out, for us, our supplier was giving us the best deal, and the only change I ever had to make was accepting a ‘fixed rate’ for a certain period.
I DID NOT DO THIS ON THE COMPUTER WEBSITE.
Having read and heard through friends of the ‘Switching’ horror stories of overcharging (been there, done that), dual tariffs being applied by two companies with neither backing down, and bills running into hundreds of pounds, I simply rang our supplier and made my changes over the phone. Talking to an individual, I could ask questions, however silly they may have been, and knew exactly what I was going to get and how much I was going to be charged. I never had another problem.
The irony is that the company who supplied us has got one of the worst reputations for service, yet my phone calls had always got results, assistance and clarification. Our final package was on a fixed rate until April the year after we left, and we had a discount of £40 a year, which was applied each quarter against our standing charge.
Now there is another con and variation. Standing charges were removed from bills years ago, but the companies covered their loss by an increase in unit cost (being a number cruncher, I worked that out from my first ‘new style’ bill).
However, they have now been reintroduced, surprisingly with no reduction in tariff, and little tweaks made here and there on the bill format trying to convince customers that this is not another back door increase or tax on essentials.
I can therefore understand why ‘loyal customers’ are seen to be being fleeced by their supplier, but chose to stick with them. From a consumer viewpoint, I would be loath to change if it was practically a given that switching was not as straightforward as one would be led to believe, and rather than save money, I could be out of pocket for months whilst the companies got their act together. Logic would however dictate to CANCEL the direct debit to the losing company on changeover.
** We have a meter system here on the marina and so have no say in who supplies the power. However, our unit rate is just 18.5 pence per kwh, purchased in multiples of 100, and you know what? Our usage equates to around £300 a year, but that does include our winter heating using our oil filled radiators.
There is no company, employee or customer loyalty anymore. Who wants yet another piece of plastic in their wallet for discounts on things they’re never likely to use, buy or need.
Perhaps a Fat Kitty who doesn’t quite know the ropes yet will come up with the idea of an annual discount for long standing customers that’s reflected in their bill as a visible bonus.
Our cottage would have been classed as a medium sized property in the examples in the linked article. Our annual electricity usage was around 1800 kwh and we paid £25 a month which was perfectly adequate to cover it. With no gas, our heating was oil run, and we filled our tank once a year prior to the winter price rises (800 to 1000 litres depending on the severity of the preceding winter), at the time being 60p a litre.
This was around 35p a litre when we priced it for MOH to fill his new oil tank.
As far as we know, Frank hasn’t been fed yet.