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[July 14, 2014]
The best energy deals and why you should switch suppliers now
(Guardian Web Via Acquire Media NewsEdge) The sun is shining (maybe), your heating is turned off and your shower is on a noticeably cooler setting. So why bother thinking about your gas bill? If you are renting, the chances are you may never have switched supplier, according to new research from the energy regulator Ofgem, and this could mean you are missing out on savings of up to £200 a year. Three-quarters of tenants say they have never switched energy supplier – with many of those not realising that they are entitled to, says the regulator. Renters are only half as likely to switch supplier compared with homeowners and many assume they have to accept the energy supplier already in place when they move into their rented property.
This could see them languishing on energy companies' most expensive tariffs, which are the ones the suppliers switch the property to when a householder ends their contract. So, what are your rights and where should you go for the best deal? Am I allowed to switch even if my contract says otherwise? Yes you are, as long as you (rather than the landlord) are responsible for paying the gas and electricity bill. This is the case even if there is a tie-in with a particular supplier written into the contract.
Last year, the BBC programme Watchdog highlighted a number of cases of tenants of Foxtons and other estate agencies having trouble switching away from Spark Energy, the supplier that the agencies had a tie-in with. In one case tackled by Guardian Money last year, a tenant was hit (incorrectly) by a £22,500 final bill from Spark Energy for six months in a studio flat. She said she was forced to go with the company by her landlord.
Ofgem rules state tenants shouldn't be "unreasonably" prevented from switching – even in the case of a tie-in.
Contracts often state that you need to ask your landlord's permission for switching. This is fine as long as, again, the landlord does not then unreasonably prevent you from doing so.
If your energy is paid for as part of your monthly rent, you have no automatic right to switch as the landlord is responsible for paying the bill. However, if you think you are getting a bad deal on your energy, you should still approach him or her about switching supplier.
I'm on a pre-pay meter. Can I switch to a standard billed meter? This is more complicated as it will involve the landlord having to make physical changes to the property. You should first investigate whether you could save money by switching to a pre-payment tariff, which is something the landlord cannot prevent you from doing. If you still want to change to a standard meter, you will need your landlord's written permission.
What are the best energy deals at the moment? There is little point in opting for anything other than a fixed tariff now, says Joe Malinowski at price comparison website theenergyshop.com, as the prices are much cheaper than on a variable tariff. Fixed tariffs lock your energy prices in for a set time, so you can be sure that, while your bill will vary based on usage at different times of year, it won't be affected by your supplier putting prices up (or down).
The cheapest deal comes from First Utility, fixed until September 2015 at a typical £993 a year for someone in an average-sized house, paying for dual fuel monthly by direct debit. There is a £30 per fuel early exit fee. Next up is Green Star Energy, fixed for 12 months at £1,009. There is a £50 per fuel early exit fee. Flow Energy is the cheapest provider without an early exit fee at £1,010 fixed until September 2015. If you want to go with one of the big six suppliers, EDF is the cheapest bet, fixed until February 2016 at a typical £1,049 annually but with no early exit fees.
Watch out for customer service as well as price. First Utility, for example, may be the cheapest but attracts more than its fair share of customer complaints. In the most recent Which? customer survey it scored a total of 58% for customer satisfaction.
What if my tenancy contract expires before my fixed tariff does and I want to move house? Fixed tariffs tend to lock you in for a year or longer and, according to Ofgem, it is up to the supplier as to whether it will let you take your tariff with you when you move house. From a legal perspective, porting your tariff is breaking the terms of the contract, as the contract is tied to a specific person in a specific property, Ofgem says. However, in reality most suppliers will allow you to move without charging you the exit fee as it is in their interest to do so. First Utility, EDF Energy and British Gas, for example, will all waive the fee if you move house within the fixed-rate tariff period. This is important to establish before you sign up to a supplier, however, as if you do get charged this could be up to £50 per fuel (see above).
(c) 2014 Guardian Newspapers Limited.
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