How to save money on gas and electricity bills

Best ways to save on gas and electricity

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Energy bills can be expensive, but there are a few things you can do to keep your costs as low as possible:

Switch

Changing energy supplier is easy and can knock hundreds of pounds off your bills.

It doesn’t matter if you rent or own your home. As long as you pay for your own gas and/or electricity, you should be able to switch.

If your landlord pays for your energy, they have the right to choose the supplier. Some tenancy agreements might have clauses about switching. But if you pay for your energy, you should be able to decide who to get gas or electricity from. 

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Pay by Direct Debit

It’s usually cheaper to pay by Direct Debit and means you won’t have to worry about missing payments.

Use less

It sounds obvious, but the less energy you use the lower your bills will be.

There are plenty of tips and tricks you can use to cut your use. We’ve listed some below.

Make your home more eco-friendly

Better insulation, a new boiler, solar panels. There are lots of options out there which could help you save up to £250 per year. You might qualify for a government grant – see below.

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Switching gas and electricity suppliers – the basics

Changing energy supplier is easier than ever and can save you hundreds of pounds on your energy bills.

The whole process shouldn’t take more than 21 days and you won’t be cut off at any point. The only change you’ll notice is a new supplier sending you your bills (if you switch supplier) and lower rates.

If you get a Warm Home Discount, make sure the supplier you’re switching to offers the discount. 

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If you decide to switch, you’ll need a recent energy bill (or annual energy statement) and your bank details.

Your energy bill has details about your current energy plan, including how much you use and the name of your tariff. If you don’t have a recent energy bill, you can contact your current supplier for this information.

Step 1 - Choose a comparison site

Price comparison websites help you compare the different energy deals available and they’re a great way to see what’s available.

They don’t all work with the same suppliers, so use a few to make sure you don’t miss out on the perfect deal.

We suggest using sites that Ofgem recommends and that have been accredited with the Confidence Code. That’s because these sites will:

  • help you find the best deal for you in your local area
  • provide a free and easy-to-use switching service
  • give detailed information on each tariff, including gas and electricity unit prices
  • have details about any discounts available.
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Step 2 – Switch

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When you’ve picked a few price comparison websites to use:

  • Put your details into the price comparison sites.
  • Look through the results and choose the energy plan that best suits your needs.
  • Don’t forget to look at more specialist tariffs, such as Economy 7. This charges you much less for electricity you use at night. So if you use storage heaters, dishwashers, slow cookers or washing machines off-peak, you’d save money.
  • Your new supplier will arrange the switch and will ask you to provide meter readings.
  • Your previous supplier will send you a final bill.

That’s it – you’re done. The whole process shouldn’t take longer than 21 days.

What if I have a prepayment meter?

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A prepayment meter works like a ‘pay-as-you-go’ tariff for gas or electricity. You need to pay for energy before you can use it.

That means putting money directly into your meter, using an electric or gas meter key, tokens or, in some cases, topping up online.

The main benefit of prepayment meters is that you won’t spend more than you have. But it’s also one of the most expensive ways of buying energy.

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My energy supplier wants to install a prepayment meter

If you’re in debt to your supplier, they might decide to install a prepayment meter in your home.

But you can refuse it if it would be difficult for you to go to the shops and top it up. You can also refuser if the meter would be difficult to access due to a disability, or if you’re elderly.

If you’re having difficulties dealing with your energy supplier, you can sign up to use the Priority Services Register (PSR).

This offers you free support to help you work through any problems with your suppler.

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Can I switch energy if I have a prepayment meter?

Yes, many energy suppliers have a prepayment tariff. So you can compare these and pick the cheapest.

All you need to do is choose a price comparison site on the Energy Compare website and tell them you have a prepayment meter. It’s best to use more than one comparison site, as they don’t all show the same suppliers.

You’ll then be shown a list of prepay gas and electricity deals you can switch to.

You won’t be getting the cheapest deals available on the market, but you still might be able to save money on your bills.

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Switching to a standard meter

Prepayment meters are one of the most expensive ways to get energy. So it’s worth asking your supplier if you can switch to a standard meter.

Your supplier might ask you to pay for your meter to be changed, or meet certain conditions – such as not being in arrears for a period of time.

You might be able to save hundreds of pounds a year by moving to a standard meter and switching to a better deal. So it’s definitely worth asking.

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Make your home more energy efficient

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Spending a little to save a lot is a good investment – especially if you don’t have to spend your own money.

There are lots of grants available to help with things like:

  • improving your insulation
  • upgrading your boiler and appliances
  •  installing solar panels or other renewable technologies.
  • Even without a grant, some of these investments will pay back what you’ve spent quite quickly. They’ll then start saving you money.

Green Homes Grant

Until 31 March 2021, homeowners and landlords in England could apply for a financial voucher to make energy efficient home improvements under the Green Homes Grant scheme.

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Fixed price energy tariff vs variable rate energy tariff

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With a fixed price energy tariff, you won’t be affected by price hikes during the contract.

However, but if energy prices fall, you might have to pay a more expensive rate.

Some fixed tariffs have exit fees, which you’ll to pay if you want to switch again before it ends.

Getting a fixed tariff doesn’t mean your energy bills will stay the same, regardless of how much energy you use.

You’ll pay the same rate per unit. But if you use more units, you’ll spend more money.

With a variable rate tariff, your bills rise and fall based on what’s happening in the energy market. But, if energy prices drop so will your bill.

Energy price cap explained

An energy price cap means that energy suppliers won’t be able to charge more than the capped price for energy.

Be aware that:

  • even with the cap, you’ll probably still have to switch to make the biggest savings – use our switching tips to get the best deal
  • it’s not a cap on the total price you pay, but a cap on the rate that will be charged
  • not all energy tariffs are price capped
  • the cap varies depending on where you live in with the UK – the average cap per year being £1,138 for the average default tariff (£1,156 prepayment meter), from 1 April 2021 to 30 September 2021
  • the price cap will be reviewed during the year, so it could go up.
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Help if you’re sent a catch-up bill for energy – energy backbilling

Sometimes you might be using more energy than the amount your energy supplier thinks you’re using.

This is more of a problem if you’re on a Direct Debit, or don’t send your meter reading to your energy supplier regularly.

If you’re using more energy, your supplier might send you a catch-up bill. This is a bill for the extra energy you’ve used above the amount you’ve paid for.

If you’re switching, you could be sent a catch-up bill. This will depend on how accurately you’ve been charged for your energy use.

Energy backbilling sets out rules for sending you catch-up bills. They can be for any amount, but can’t be for energy used more than 12 months ago.

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What happens if my energy supplier goes out of business?

While it’s rare, sometimes energy suppliers do go bust.

If this happens, the Ofgem safety net makes sure you aren’t left without energy.

The safety net moves you automatically to a new energy supplier, onto a new deal. The deal is chosen using a competitive process and might be slightly more than your previous tariff. You can end your new deal whenever you want.

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Struggling to pay your energy bills?

Not being able to afford to heat or power your home can be worrying. However, there is help available if you’re struggling.

The government has launched an emergency package with energy suppliers to make sure you can heat and light your home.

It’s important to get in touch with your supplier to ask for help before you miss a payment.

If you’re struggling with money or repaying a debt, options include:

  • reviewing bill payment plans, including debt you might be repaying in instalments
  • payment breaks, or reductions in how much you pay
  •  having longer to repay what you owe
  • access to hardship funds – this is only in exceptional cases.

If you pay for your energy after you’ve used it, you have a credit meter. Credit meters won’t be disconnected during the coronavirus crisis.

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Find out who your gas or electricity supplier is, and their contact details, on a recent energy bill.

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Your energy supplier might have fewer staff available to help you at the moment. Try contacting them online. If you don’t get a reply, it’s worth chasing it up.

If you get benefits, you might able to pay back money owed to your energy supply using the Fuel Direct Scheme.

This works by automatically taking a set amount from your benefits to pay your debt, plus an extra amount to cover your energy use.

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What happens if I miss a payment on my gas or electricity bill?

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Have you already missed more than one payment and aren’t able to come to an agreement with the provider? Then it’s best to get advice as soon you can, especially if you’ve got other debts as well.

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MoneyHelper is the new, easy way to get clear, free,
impartial help for all your money and pension choices.
Whatever your circumstances or plans, move forward with MoneyHelper.

Continue to website
Looking for us? Now, we’re MoneyHelper

MoneyHelper is the new, easy way to get clear, free,
impartial help for all your money and pension choices.
Whatever your circumstances or plans, move forward with MoneyHelper.

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