Ofgem to launch energy switching service to help customers find cheaper offers – how to cut your energy bill now
Britain's energy regulator today outlined several proposals to help about two million customers on low incomes
OFGEM said it would be testing its own online switching service as part of plans to clamp down on the most vulnerable customers being overcharged for gas and electricity.
Britain's energy regulator today outlined several proposals to help about two million customers on low incomes.
The regulator said it wants to “take the hassle” out of switching suppliers by imposing new rules that will make it easier for customers to find cheaper deals on price comparison websites.
The watchdog will also trial a new “Check Your Energy Deal” online switching service aimed at helping customers who have been on poor value standard variable tariffs for three years or more to find cheaper deals.
The trial will take place in September in Northampton, with up to 10,000 customers from one supplier.
A “safeguard” tariff to protect customers on low incomes from overpaying for their electricity and gas is also among the reforms published today.
The tariff, which came into force on April 1, is intended to benefit households who prepay for their energy and have a smaller choice available to them.
A limit on the cost of gas and electricity for those on pre-payment meters already saves about four million people about 10 to 15 per cent on their bills or £80 per year.
Under new plans, this could be extended to about two million others on certain benefits.
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Dermot Nolan, chief executive of Ofgem, said protecting vulnerable customers is a “priority” for Ofgem.
For UK households with typical usage it was supposed to mean an average saving of about 10-15 per cent , or about £80 per year, accord
“We are committed to ensuring that the more disadvantaged in society are not left behind as we move towards a smarter, more competitive energy market,” he added.
HOW TO CUT YOUR ENERGY BILL NOW
MILLIONS of households across the UK have never switched and are stuck on the most expensive tariffs.
If in doubt, call your provider and ask them to move you to their cheapest tariff.
Better still, use a comparison website like MoneySuperMarket.com or Energyhelpline.com to find the very best deal for you.
The cheapest tariffs are usually found online and are fixed deals – meaning you guarantee how much you’ll pay for a set amount of time, usually 12 months.
Switching to a cheaper supplier could cut your bill by up to £300 a year.
The amount you pay varies depending on where you live and how much energy you use.
The proposals come after a much wider cap in the Conservative manifesto was dropped from the Queen's Speech.
The crackdown on energy prices came after all of the ‘big six’ energy firms announced a slew of price changes earlier this year.
In March, E.ON announced it was pushing up prices by almost 14 per cent – adding £97 a year to bills from April 26.
Npower added £109 a year to bills – a rise of 9.8 per cent – from March 16.
Scottish Power pushed up bills by an average of 7.8 per cent – adding £86 a year to bills – from March 31.
Hannah Maundrell, editor in chief of money.co.uk, said Ofgem’s proposals make more sense than a blanket energy cap but she has yet to be convinced their measures go far enough to support vulnerable households.
“Switching energy supplier is genuinely really simple and it’s vital this opportunity to save is made accessible to everyone. My big concern is the many households that aren’t digitally savvy are still going to lose out,” she said.
“Maybe Ofgem need to rethink their classification of vulnerability to include the many households that won’t ever go online to switch,” she added.
Stephen Murray, energy expert at MoneySuperMarket, said that the general sentiment from Ofgem's announcement is positive but customers shouldn't wait for any of the proposals to be rolled out to switch providers.
"Switch your energy tariff today on a comparison site and you could save £300.It’s hassle free, take five minutes and means you can bring your bills down before winter arrives and bills go up,” he said.
HOW TO FIND A CHEAPER ENERGY DEAL
FIRSTLY, you’ll need to have a recent bill to hand. This will have all the details you need, including the name of your tariff and your recent spending on gas.
- Use a comparison website - Customers can you use websites such as uSwitch.com or Energyhelpline.com to compare tariffs and find a cheaper deal. You could save up to £400 a year if you’ve never switched before.
- There are other service you can turn to - MoneySavingExpert’s Cheap Enegy Club will let you set up an email reminder that alerts you when cheaper deals become available.
- Things to do before you switch - Compare prices and before you switch check to see if you can get cachback from a website like Quidco or TopCashback
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