How to lower your energy bill without the hassle of switching
Energy prices only ever go in one direction, leaving you with two options. You can bury your head in the sand and complain about it later, or you can fight to get the cheapest deal possible.
If you're sick and tired of your electricity provider taking you for granted, this is what you can do about it.
There's never a bad time to compare electricity offers, especially if you're on a variable rate contract, because the prices you are charged by your retailer can change at any time.
This not only means that you could end up being charged more without even realising, but there could also be better deals around if you're prepared to look.
The nature of a deregulated electricity market means there are two types of energy customers - winners and losers. Even if power prices rise significantly, you as an individual electricity customer can still save, provided you know what to do and take action.
Getting a better energy deal
Getting a better deal on your electricity is not as difficult as you may think it is. You have three options:
- Ask your existing retailer for a better deal
- Wave goodbye to your existing retailer and switch
- Secret option number three, which we'll come to shortly
Whichever option you decide to take, the most important thing is that you do something. If you don't, you'll pay for it.
Asking your retailer for a better deal
If you've been with your existing energy company for more than a year, you should absolutely ask for a better deal. The cheapest deals are often reserved for new customers, so keep your retailer on its toes and ask to be treated the same.
- Ask your retailer what its cheapest plan is. The plans with the biggest discounts are not always the cheapest, even with the same retailer.
- Ask your retailer to give you an additional discount on top of the existing offer.
- Ask that the discount is ongoing, rather than just for a year or two.
- Ask that the discount is backdated to your most recent energy bill.
There is really nothing to lose by asking your power company for improved terms, but to improve your chances of succeeding, it's best to do a little homework first.
Compare electricity offers and find out how much you stand to save by switching. Find out which other retailers are offering good deals and quote these to your existing provider.
The key is to convince your retailer that you're serious about switching. It will likely have a limit as to what it can offer you - make sure you push it to that limit.
Comparing offers and switching retailers
If you're not satisfied that your existing retailer is trying hard enough to keep you - or you just fancy a change anyway - you can up sticks and leave altogether.
If you've been with your retailer for more than a year and haven't attempted to get a better deal, you are almost certainly paying more than you need to, so switching could be a great way to save.
- When comparing offers, make sure you know your typical daily usage. Finding the cheapest deal for your household could depend on your usage habits.
- Be aware that many big discount plans are temporary and that after the benefit period ends you will start paying the full, non-discounted rates.
- Check the energy price factsheet to get a good idea of the actual rates you'll be paying. If you're a small household, pay particular attention to supply charges. If you're a larger household, then pay particular attention to usage charges.
- If you find two similarly priced plans, consider what other sign-up incentives are being offered, such as a rebate on your first bill, or rewards programs.
Even if you don't go ahead and switch, getting into the habit of comparing offers is a smart move.
You'll be surprised how often deals can change and you may need to get in quick to take advantage.
Switch. But don't switch
Getting the absolute cheapest energy deal possible may involve switching, but then not actually going through with it.
When you switch retailers, you will have a 10 day cooling off period in case you change your mind.
It's common for existing retailers to contact customers when they discover they have set the wheels in motion to switch, so expect a call. If you didn't get your retailer's cheapest offer before, you will now.
- Don't just sign up to any old energy offer with the aim of getting a better deal from your existing provider. You should only switch if you've done your homework and you're serious about it.
- However, the cooling off period is there in case you change your mind. There is nothing wrong with doing so if your old retailer comes up trumps with a great deal.
- If you're existing retailer offers you improved terms, that's great. If not, you'll still be switching to a better deal than you had before.
- If your retailer doesn't make contact during the cooling off period, there is nothing stopping you from picking up the phone and giving it one last chance to keep you.
If you're existing retailer really pulls out all the stops to keep you, you'll be unlikely to find a cheaper deal elsewhere.
This author recently switched retailers, and during the cooling off period, his old provider got in touch and doubled the conditional discount that was previously offered.
Your old retailer may not always come back with a deal that's too good to turn down - which is why you should only switch if you're serious - but this goes to show how hard some providers will work to keep you on board. Energy companies would rather keep you but make less money from you, than not have you at all.
If there is one take home message, it's that you - as the energy customer - have a lot more power over your energy bills than you probably realise.
To get the best deal you can, you'll need to flex your consumer muscles.