Easy guide on how to switch energy supplier
Switching energy suppliers is easy, however if you have never switched before it can seem confusing. Not knowing what the rules are or how to even start the process means that many people do not even try even though most people can save money by switching to a cheaper tariff.
So here is a simple guide on how to switch and we'll bust a few myths and give you some straight forward tips on how to switch painlessly.
Why do you need to switch energy suppliers?
If you stay with the same company you will be charged more. Energy companies like to charge loyal customers more because they know it is unlikely you will go elsewhere. They can get away with charging more for the same energy.
No matter who bills you for the gas and electricity that supplies your home the actual gas and electric you receive is the same. No pipes or wires need changing, everything stays the same except the company that sends you the bill. Some companies charge more and some charge less.
For the average 3 bed semi house choosing the cheapest supplier over the most expensive can save you £711 a year. Take a look at our analysis of the cheapest gas and electric suppliers.
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What information do you need to compare and switch?
All you need is a copy of your latest bill or statement from your current energy company as this contains all the information that you need.
Your paper bill or if you manage your account online your PDF or online equivalent will contain the information that you need.
- Name of your energy company.
- The tariff you are on.
- Your annual estimated gas usage in kWh.
- Your annual estimated electric usage in kWh.
Use an Ofgem accredited comparison site
Ofgem the energy regulator lists their trusted energy comparison sites. We're using Energy Helpline for this guide.
As the UK is divided into energy regions you need to provide your postcode in order to locate the energy region you come under. Energy is charged at different rates around the UK and due to the differing transmission costs and other factors.
At this point you can also provide your street address but this is not essential at this point.
Do you have a gas and electric supply?
You need to state whether you use gas, electric or both. Some properties such as flats or houses in villages not connected to the gas grid will only want to compare electricity suppliers.
Some households have a different supplier for their gas and electricity. You need to say if you get your gas and electric from the same or different suppliers.
Your current supplier
Provide your current suppliers name and the tariff you are currently signed up to. All of this information is on your bill or statement.
How do you pay your current energy company?
State whether you pay by monthly or quarterly direct debit or when you get a bill. The cheapest tariffs tend to be tied to monthly direct debits as it makes it easier for energy companies to forecast their cash flow. You tend to save most by switching to monthly DD's.
Are you on Economy 7?
Choose whether you are on Economy 7 or not, most people are not on an Economy 7 tariff. Economy 7 is a type of electric tariff that has two tariff prices, daytime and nighttime. It means you get cheaper electricity during the night but more expensive electricity during the day. Useful if you use most of your electric at night such as having night storage heaters or charge your electric car overnight.
How much do you spend on energy?
To get the most accurate figure use the figures from your most current bill or statement showing your annual kWh usage for gas and for electricity. If not you can specify how much you spend per year or monthly.
You can say you don't know and they will estimate your usage based on the size of your house. However this will not be accurate and I wouldn't recommend doing a comparison based on an estimate unless you are currently paying over the odds with your current provider.
Comparing energy suppliers
Once you click the find a better deal button you will be presented with a list of energy companies with the cheapest being shown first.
Depending on your current energy usage at home and the region you live in your switch recommendation will differ. The same energy company is not necessarily the cheapest for everyone.
Let me explain. There are thousands of UK energy tariffs, new ones are constantly being added and old one become unavailable as they expire. It means the cheapest tariff is always changing so a cheap deal that you sign up to this year may not be the cheapest the following year.
Once you find a deal that you like click the 'switch now' button to start the switching process. As you are using a free switching service, in this case Energy Helpline you provide them with your details and they will manage the switch for you so you don't have to contact your new or old supplier.
Switching takes about 3 to 4 weeks in total as the UK has a mandatory 14 day cooling off period included in the switching process in case you change your mind.
You should get a welcome email from your new supplier and about 3 weeks later will be asked to provide opening meter readings. That's usually all that needs doing.
To ensure that you are always getting the best price you should always compare at least once a year to make sure a better deal hasn't come onto the market and to ensure that you do not get moved to a standard tariff once any 12 month fixed deals come to an end.
Fixed or variable
Fixed or variable, which one should you choose? Generally fixed deals cost more but they guarantee the cost will not change over the course of the fixed deal which is usually 12 months.
Many fixed deals come with early exit fees, this is a leaving fee you would have to pay if you decided you wanted to switch again before your 12 months is up. You can find 12 month fixed energy tariffs that have no exit fees so you can leave to join another energy company without penalty.
Variable tariffs are ones that go up and down depending on the energy market. It sounds risky but it's not as energy prices are unlikely to vary dramatically and if they did you could just switch to another deal as there are no exit fees with variable tariffs.
Energy tariffs explained
An energy tariff is a price our energy company charges you for the supply and use of electricity and gas. It is made up of two components, the standing charge and the unit rate. Tariffs tend to have either a low standing charge and high unit rate or vice versa.
The standing charge is usually priced per day and there is one for electric and one for gas. This is to cover the cost of supplying the energy and everyone pays this. If you use a lot of energy such as in a 4 or 5 bedroom house or multiple adults live in the property it is better to have a high daily charge as this means your unit rate is usually lower.
The unit rate is the price you pay for each kWh of gas and electric that you use. If you are a high usage household you will be better on a low cost per kWh rate as the higher daily standing charge will be less of a significant factor.
If you use less energy you will have lower bills with a tariff that has a low standing charge and a higher unit rate as the standing charge will make up a larger percentage of your overall bill.
How long does it take to switch energy supplier?
Switching energy suppliers takes about 4 weeks in total. It includes a mandatory 14 calendar day cooling off period which was introduced on 13th June 2014 to protect consumers should they decide to cancel a gas and electric switch.
When can you switch energy suppliers without penalty?
You can switch energy suppliers anytime you want. However if you have entered into a 12 month fixed deal with your current supplier and that deal included early exit fees you can't switch until you have 49 days or less left on the contract without incurring fees (usually £30 to £35 per fuel).
If you find a much cheaper deal where you can still switch and pay the exit fees to your old supplier to leave the contract early. If your potential switch is going to save you several hundred pounds it may be worth switching rather than waiting.
How often can you switch energy suppliers?
You could switch every month if you wanted but it would be unlikely to be worthwhile with regards to savings. Energy prices do change and better deals do come along but you are unlikely to benefit from significant savings one month after switching.
Comparing your current deal on a comparison site once or twice a year is usually often enough to ensure you are getting the cheapest gas and electricity.