Today’s cut means the average annual E.ON dual fuel bill will reduce from £1,232 to £1,185. This is good news for around 1.9 out of its 5.5 million customers, because those on electricity only or fixed tariffs will not feel the benefit.

Speaking of their price cut, E.ON’s retail managing director Graham Bartlett said, ‘We’ve been very aware of the effect of both the recession and the exceptionally cold winter on our customers, especially those most in need, so we are pleased to see the opportunity to now reduce prices.’

Although consumer groups have responded positively to the news, they have also been critical of the time energy suppliers have taken to cut their prices despite the unusually cold winter and the drop in wholesale prices. This has resulted in millions of households struggling to pay their energy bills.

Bartlett defended E.ON’s position by adding wholesale prices were, ‘only part of the pricing story as our customers are using gas bought over a number of years at much higher prices than today’.

E.ON’s price cut will be effective from 31^st March, and those on its WarmAssist program will benefit from a back-dated low price starting from March 1^st. Although this is the third price cut within 12 months, E.ON‘s average annual dual fuel bill remains around 30% higher than January 2008 according to the price comparison website uSwitch.com.

uSwitch.com’s Ann Robinson said, ‘This will not make up the ground lost two years ago when suppliers increased prices by 42% or £381 and we now expect household energy bills to end up around £270 higher than two years ago, putting even more emphasis on the need for consumers to start managing their energy costs.”

She also added, ‘Now that three of the big six have moved we can also see a clear trend emerging with gas price cuts coming in at around 5% or £40.’

Sources:

http://www.guardian.co.uk/money/2010/mar/08/eon-cuts-gas-prices

http://www.timesonline.co.uk/tol/money/consumer_affairs/article7053897.ece

Changing energy supplier may seem stressful and daunting; however this does not have to be the case. Firstly, let’s clear up the biggest misconception many people have about it. Many customers wrongly assume switching energy supplier will lead to a disruption in their gas or electricity supply, this is not the case.

Some also think they will need to be connected to different supply pipes, again this is untrue. Energy companies will use the same pipe-work; therefore there is no need to worry about workmen visiting your home to make changes. All changes will appear on your bill.

Why is switching a good idea?

For most it’s about getting a better price and lowering bills. Some energy suppliers invariably offer cheaper tariffs than others, so it makes sense to take advantage of this. New customers tend to be offered the best deals, simply because they are new and every energy supplier wants to increase their customer base.

Once you have signed up, the tariff you are on may not seem as competitive. This is a good time think about switching again. It is wise to keep a regular check on the latest best energy tariffs using a price comparison website like Uswitch.com. These will help you find the cheapest tariffs in your area and by switching you can be confident you are getting the best deal.

These days, switching to an online tariff offers the most savings. For instance, if you opt to pay by direct debit, manage your account online and choose paperless billing, you will be rewarded even more. Online tariffs enable you to submit your meter readings online, so you do not have to worry about estimated bills.

Where do I start?

Chances are you have read or watched an advertisement from an energy supplier claiming to have the cheapest gas and electricity prices. Your instinct is to go with them; however the tariff you get will depend on your circumstances, for instance how much energy you consume and where you live.

The best place to compare and find the cheapest tariffs is the internet. Go online and use a price comparison website where you can access details of all the latest supplier prices in your area. The process is straightforward, and all you will need is a copy of a recent bill.

These websites make it easy for you to shop around for the best deals. They will ask you to fill in your postcode, and give an idea of how much energy you use, then work out your cheapest tariff. They will also help you make the switch.

How to switch

Once you have found the supplier and tariff you want to move to, you can either contact them directly where they will tell you what happens next. For those who do not want to talk to their existing or new energy supplier, a good option is to switch online using a price comparison website where it will all be taken care for you.

If you decide to switch online, you are likely to be asked to fill out some personal details i.e. name address etc. These will be passed on to the new supplier, who will contact you with details of the switch. Although it is not obligatory to inform your old supplier of your intent, it can sometimes help a smooth transition if you put something in writing to them.

Other things to consider

Now that you have agreed the switch, you should ensure you have paid any outstanding bills. You will also need to take a meter reading on the day your old supplier finishes, and your new supply begins. This will ensure your bills are accurate.

How long will it take?

It normally takes between 6-8 weeks to change energy supplier. You will receive a welcome letter from your new supplier explaining when the switchover date will be, and a final bill from your old supplier.

Sources:

http://www.confused.com/guides/household/energy/step-by-step-guide-to-the-energy-switching-process-2917107722

http://www.consumerfocus.org.uk/energy-help-and-advice/households/how-to-switch

This week, independent energy company First:Utility undercut the ‘Big Six’ energy supplier deals with its new dual fuel tariff iSaveV3. It supersedes iSaveV2, offering a further 3% off its standard prices and an average annual bill of £889.

First:Utility claims its new standard gas and electricity prices will save customers paying by cash or cheque on average £20.28, and those on a direct debit plan £8.35.

It’s CEO, Mark Daeche said, ‘We know that what matters to UK households is that they can keep their energy costs as low as possible and we believe that this Standard tariff will help them achieve this.’

iSaveV3 is £10 cheaper than British Gas’ Websaver 6, and £15 better than EDF Energy’s Online Saver 6, making it the cheapest standard dual fuel tariff in the UK today.

Daeche said of its launch, ‘We’re aiming to send out a clear message…that there is a real alternative to the Big Six incumbent energy companies. I would urge people to act with their feet and demonstrate to the companies that dominate the energy sector in the UK – that people want a better deal and better service’.

The new tariff comes at a significant time in the energy market, given British Gas’ standard price cuts last month and new tariffs from the likes of nPower and EON. Customers ready to make the switch, however are being urged to hold fire because more price cuts are imminent.

Some industry experts are predicting further price movement following the bumper profit margins recently announced by energy suppliers, including Centrica (British Gas). This has led to Ofgem – the energy regulator, encouraging them to pass on wholesale savings to their customers. The government has also called for better customers deals.

This combined with First:Utility’s latest offering means the price war between energy suppliers is likely to increase, which is great news for customers.

If you are looking for a better deal on your gas and electricity, the best place to start is by comparing tariffs using an energy comparison website. Online tariffs are by far the most competitive, and you could shave a few hundred pounds off your annual bill by switching online.

Confused.com’s utilities expert, Gareth Kloet said, ‘Opting to pay by direct debit, switching to an online tariff and becoming more aware of their energy consumption are three easy steps customers can take to reduce their bills significantly.’

You can also review the latest deals by visiting our best energy tariffs page.

Sources:
http://www.energychoices.co.uk/partner-40451/first-utility-knocks-british-gas-off-cheapest-deal-podium-25021002.html
http://www.confused.com/featured-articles/household/energy/energy-price-war-it-s-coming-2894930494

Designed to cut carbon footprints and energy bills, the boiler scrappage scheme gives households £400 towards replacing their aging boilers with new energy efficient ones. Since its launch at the beginning of the year, it has seen an uptake of over a third of its vouchers, leaving around 70,000 worth £28million available to claim.

The scheme itself is also under attack as some heating specialists believe replacing a working boiler for around £2,000 is ‘financial madness’. Charlie Mullins from Pimlico Plumbers argues, ‘What is the point of replacing a boiler in perfectly good working order? It is financial madness. New energy-efficient boilers are not built to last like the old models — if you get ten years out of them, you’ve done well. We often have to replace boilers that are about six years old.’

Energy suppliers including British Gas, nPower and EON are offering a further £400 discount to match the government’s scheme, saving customers potentially £800 off the cost of a new boiler. Although it sounds like a great deal, some customers claim the prices they are being quoted by energy suppliers are considerably higher than independent heating specialists.

Green Heat’s Peter Thom said ‘The energy suppliers are top-loading the price and then offering an £800 discount. A customer I saw in Cambridge received a quote from British Gas of £5,012 for a boiler replacement, which reduced to £4,212 with the £800 discount. Our quotation for exactly the same work and identical boiler was £2,894.’

British Gas responded by saying ‘We have not increased our prices and they are actually lower now than they were 12 months ago, as we’ve been working with manufacturers to ensure a good deal for customers. The cost of a boiler will vary based on the customer’s home and lifestyle.’

Most households tend to go with a trusted brand when it comes to boiler replacement; however some are confused by the dramatic difference in prices, and wondering if it is worth taking up the scheme. It is advisable to shop around and get at least three quotes, including one from an independent heating company before making any decision.

Households should also consider the longer term benefits of installing an A-Rated energy efficient boiler, rather than its initial cost according to the energyhelpline’s Mark Todd. He advises, ‘Consumers should be aware that the savings come in the long term. The cost of a new boiler is £2,000-£3,000, so a £400 discount means that customers will still need to pay £1,600 to £2,600. With a saving of £200 a year on energy bills, it will take those signing up 8-13 years to break even, when it will probably be time for a new boiler.’

If you are considering replacing your boiler, read our article Boiler Scrappage Scheme – What You Need To Know, and find out if you are eligible. Further information can also be found on the energy advisory website energysavingtrust.org.uk.

It is also worth doing some reading up on boilers. Our boiler manufacturer’s guide is a good place to start.

Sources:

http://www.timesonline.co.uk/tol/money/article7033768.ece

http://www.energysavingtrust.org.uk/Home-improvements-and-products/Heating-and-hot-water/Boiler-Scrappage-Scheme

According to Ofgem, British Gas, EDF Energy, nPower, EON, ScottishPower and Scottish & Southern Energy have seen their average profits earned per dual fuel household jump from £75 last November to around £105 this month.

Although this is set to decrease soon, given British Gas’ price cuts and the imminent pricing activity from its rivals, it is the highest amount energy suppliers have earned since 2004. The figures have resulted in more criticism of the energy market, and raised the question why energy suppliers are not passing on cuts in wholesale prices to their customers.

Consumer Focus’ Mike O’Connor said, ‘Householders will no doubt wonder why margins have increased for the fifth quarter in a row, while wholesale costs continue to fall.’ Price comparison website Moneysupermarket.com has reported average annual dual fuel bills to have rocketed from £912 to £1,223 since 2007.

So why are energy suppliers blatantly profiteering, while household energy bills continue to rise?

Ofgem has responded by agreeing all energy suppliers need to remain profitable in order to invest in their infrastructure and renewable energy projects. An estimated £200billion is required by 2020 for future energy supplies and to hit the carbon emissions target.

The good news is Ofgem also recognizes the need to lower gas and electricity bills. Andrew Wright from Ofgem said they, ‘…would also expect recent falls in wholesale energy costs to be passed on to consumers.’

The government is also backing Ofgem by urging suppliers to cut their prices. The Energy and Climate Secretary, Ed Miliband said, ‘Householders facing high winter fuel bills deserve to see the benefits as soon as possible,’ he added, ‘British Gas’s cut was a welcome first move, but we need to see all suppliers passing on the benefits of lower wholesale prices.’

In response to Ofgem’s report, the energy suppliers commissioned their own with the consultants NERA. They disputed Ofgem’s figures, claiming they did not account for other costs associated with energy supply like distribution ad discount tariffs.

NERA’s Graham Shuttlework said, ‘The costs of buying energy only make up around half of a customer’s bill’.

Energy UK, who represent energy suppliers agreed the figures released by Ofgem did not include all the costs faced by energy providers.

There are ways to lower your energy bills. Our article ‘Is now a good time to switch energy supplier?’ covers where and how to find a cheaper tariff online. Our ‘5 cheap ways of saving energy and money’ will also help you cut the amount you pay.

Sources:
http://uk.reuters.com/article/idUKLDE61H0TS20100222?sp=true
http://business.timesonline.co.uk/tol/business/industry_sectors/utilities/article7036992.ece
http://www.ft.com/cms/s/0/9bfd7240-1fef-11df-8deb-00144feab49a.html
http://www.moneysavingexpert.com/news/utilities/2010/02/ofgem-urges-households-to-switch-energy-supplier
http://www.mirror.co.uk/news/city-news/2010/02/23/big-six-energy-companies-making-record-225-from-each-customer-after-slump-in-wholesale-costs-115875-22062788/
http://www.mirror.co.uk/news/city-news/2010/02/23/beating-the-fuel-cheats-115875-22062786/

The news could help millions of households because they will be notified sooner about rises to their gas and electricity prices. The current regulations allow energy suppliers to wait up to 65 working days before notifying customers of price changes, but Ofgem is proposing this be cut to just 10 days.

Although any new regulations will not come into affect until at least the end of the year, they have been welcomed by consumer groups who have campaigned for a reform to protect customers. Peter Vicary-Smith of consumer group Which? said, ‘We’re pleased that the Government agree with us that the current rules are completely unfair on consumers. It’s outrageous that energy suppliers can keep their customers in the dark over a price hike for so long.’

The government has backed the plan, by amending its Energy Bill last week. The change gives it the authority to change the notification period, unless Ofgem sorts it out first. Vicary-Smith added, ‘It’s vital that this amendment is kept in the Bill and that the Government uses it to force suppliers to give advance warning of any price changes. Ofgem must act now and amend the license condition so that consumers don’t have to wait.’

The 65 day notice period was described by Ofgem as a ‘backstop’ following its recent review of the energy market. It said informing customers as soon as possible was always the preferred option by suppliers. Where customers were informed after the price had increased, suppliers would need to give 20 days for them to switch without being penalized.

Representing energy suppliers, Christine McGourty of Energy UK said energy companies usually inform their customers before their prices rise. She said, ‘Most customers are advised of a price change within weeks, but the 65-day notice period allows companies to communicate with all customers in the most cost-effective way – via their bill.’ She added, ‘If customers are not happy for any reason, they always have the option to switch supplier or tariff to avoid any unwanted price changes.’

Joan Ruddock, energy and climate change minister said, ‘Energy companies have got to be fair to customers, and if they are not and if Ofgem cannot fix it, then we will.’

Sources:

http://news.bbc.co.uk/1/hi/business/8516728.stm

http://www.energyhelpline.com/news/article.aspx?aaid=19617742&y=2010&m=2&w=3&pid=1

http://www.which.co.uk/news/2010/02/energy-customers-set-to-get-price-rise-warnings-203775

Figures released by the Department of Energy and Climate Change this week revealed a total of 54,578 vouchers taken, out of the possible 120,000 available at the start of the scheme in January. This leaves around 70,000, worth £28million up for grabs. So if you want to take advantage of it, you should act now to avoid disappointment.

The scheme was set up to help households reduce their carbon footprints and save money on their energy bills. Any household in England using an old gas-guzzling ‘G-Rated’ boiler can claim £400 towards replacing it with a new ‘A-Rated’ one.

Ed Miliband, the energy and climate change secretary said ‘The scheme is helping householders to save around £200 a year on fuel bills and reduce emissions, while helping to sustain work for the 130,000 installers and up to 25 UK-based boiler manufacturers’.

Since the launch of the scheme, all the major energy suppliers including British Gas, npower and E.ON have matched the government’s offer. This means households can potentially save £800 off the cost of a new energy efficient boiler.

The scheme is run by the Energy Saving Trust, who have been inundated with customer calls about it. They have reported receiving almost 400,000 calls, averaging around 5,000 a day to their regional call centers.

Households have no doubt warmed to the scheme; however the level of interest has meant some are facing delays in joining. The Energy Saving Trust has responded by increasing its call centre staff to meet demand.

Miliband added, ‘The boiler scrappage scheme has proved incredibly popular and with energy companies and manufacturers offering deals as well, the government scheme has truly kick-started a national programme of boiler replacement.’

Households accepted by the scheme and already in receipt of their vouchers will need to wait until their new boiler has been installed before they can claim back their money. The Energy Saving Trust will issue payment within 25 working days of receiving the voucher and paperwork detailing the cost of the job.

Do you qualify?

To join, you must have a working ‘G-Rated’ boiler, or one which is 15 years old or more. A good indicator is if your boiler has a permanent pilot light. If you are under 60, you are eligible to apply if your boiler provides the main source of heat to your home and is still working. For over 60’s, the boiler does not have to be in working order to qualify.

How to apply

Once you have checked your boiler is ‘G-Rated’, arrange a quote for a new ‘A-Rated’ model. It is wise to shop around for a competitive price, by contacting your local qualified boiler installer or your energy supplier. Once you have your quote, contact the Energy Saving Trust with the details and they will issue your voucher prior to the work starting. Once your new boiler has been installed, you will need to pay the installer in full before sending the receipt and voucher back to the Energy Saving Trust where you will receive your £400 rebate within 25 working days.

You should bear in mind some energy suppliers are offering a further £400 off.

Sources:

http://www.guardian.co.uk/money/2010/feb/15/boiler-scrappage-scheme-vouchers
http://www.myfinances.co.uk/cut-your-bills/news/over-54-000-sign-up-for-boiler-scrappage-scheme-$1360300.htm
http://www.moneysupermarket.com/c/news/act-fast-to-benefit-%20from-boiler-scrappage-scheme/0008516/
http://www.which.co.uk/news/2010/02/boiler-scrappage-scheme-vouchers-still-available-203733
http://www.electric.co.uk/news/a-third-of-all-vouchers-for-the-government-boiler-scrappage-scheme-are-gone-12341678.html

Ofgem’s shocking report was published last week, and details its findings following a four-month study of the market. It warned households would face ‘unaffordable’ energy bills and even power cuts unless significant investment was made into improving the country’s pipelines and power stations. It said at least £200bn is needed to prevent this from happening, or average households bills would reach the £2,000 mark by 2016.

This paints a bleak picture for the future but, given price cuts have been announced by British Gas and nPower is now a good time to switch energy supplier and save money?

It is a confusing time for customers, given the number of tariffs available and the conflicting opinions about who has the best prices. Should customers also wait to see how other energy suppliers respond?

Confused.com’s head of utilities, Gareth Kloet advised ‘The best strategy is to act to lower utility bills now by going online and reviewing your current tariff. One thing these differing views do show is that it is not easy to predict what energy prices will do in the future.’

Moneysavingexpert are recommending customers take advantage of online tariffs instead, where the energy price war has been rife for months. Here customers will find the most competitive deals on the market, and could secure a tariff around the £900 mark.

If customers were to compare and switch online, they could potentially shave hundreds off their annual bill, however given the current climate where other energy suppliers are likely to follow British Gas’ lead, avoiding cancellation fees and penalties is a must. Customers should look for tariffs which do not tie them in, so they can switch again quickly without being penalized.

The advice is to use a comparison website like Confused.com and check you are on the best deal. Timing is vital when it comes to switching supplier though. For instance, if prices are changing like they are now, it is better to wait until they level out. Otherwise, you could end up with the most expensive supplier.

Energy companies are renowned for following suit, so given British Gas’s price cut the others are expected to do the same soon. The worst time to switch is following the news of a price cut. Keeping an eye on what is happening and regularly comparing your current tariff instead are wise.

Remember there are still savings available if you join an online tariff, but bear in mind you will need to manage your account online, and pay by direct debit. Gas and electricity tariffs also depend on consumption levels, and where you live.

Anne Robinson, from uSwitch.com, said ‘Online energy plans consistently offer the most competitive prices – currently costing around £300 a year less than suppliers’ standard plans. But just 5% or 1.3 million households are on an online energy plan.”

Sources:

http://www.telegraph.co.uk/finance/personalfinance/consumertips/household-bills/7167759/Find-the-best-energy-deal-as-price-war-looms.html

http://www.moneysavingexpert.com/utilities/you-switch-gas-electricity

The deal starts this year, where Bglobal will begin its supply and installation of smart meters to British Gas Business. Bglobal is set to receive £1million each year, from the on-going data services it provides the UK’s leading energy supplier.

Bglobal also signed a contract with Dual Energy Direct – an electricity supply business – to manage its smart metering programme from this April.

Both deals could not have come at a better time for Bglobal, who recently announced how its profits had plummeted because of the cold snap. The company, now valued at £41million, said it had installed 10,500 smart meters over the third quarter of its financial year, ending March 31^st.

Freezing weather conditions over December and January were detrimental to its installation programme, because many schools and other local authority buildings due to have them fitted were closed down or hard to access.

Tony Barnes, Bglobal’s chief executive expects installation rates to be back on track this year, he said ‘Looking forward, our new contracts and the move to a fixed programme of meter installations in the year ahead with British Gas Business underpins our forward order book for the year to March 31 2011, which is currently more than 75 per cent covered’.

The deal with British Gas confirms their commitment to smart meters, and the significant role they play in improving energy efficiency. Barnes added, ‘The contract also signals British Gas Business’ clear intent to bring on the smart energy revolution and accelerate the benefits of smart metering for UK businesses.’

British Gas currently has around 50,000 smart meters in use, and plans to add a further 100,000 by 2011. To find out more about smart meters, and how they can benefit your business, read our article ‘Smart Meters For Businesses’.

Sources:

http://www.reuters.com/article/idUSLDE6120AF20100203

http://www.makeitcheaper.com/business-energy-news/business-electricity-news/19595923-business-energy-to-benefit-from-smart-meter-roll-out

http://www.thebusinessdesk.com/northwest/news/20848-bglobal-wins-12m-contract-but-warns-on-profits.html?news_section=4148

http://www.rttnews.com/ArticleView.aspx?Id=1198942&SMap=1

The price cut makes British Gas the cheapest amongst the Big Six energy suppliers. The saving is set to affect around 8 million households, who are likely to save on average £55 each. There is also good news for pre-payment customers, who have been given a 9% saving, which aligns their tariffs with standard ones.

This is a welcome move from the largest of the Big Six energy suppliers, and the timing is also favorable, following recent reports about how worried households are about the cost of their heating bills this winter.

British Gas’ managing director, Phil Bentley said ‘I’m pleased we’re able to offer our customers some extra help with this gas price cut – and that we’re able to do this while it’s still winter, allowing our customers to really feel the benefit.’

The cuts take the company’s average annual dual fuel bill to £1,123, versus £1,310 in January 2009. Critics are saying this is still not enough, because customers are still paying considerably more since January 2008, when wholesale gas prices were high – the average bill then was £1,055.

Nevertheless, consumer groups are nodding their heads in approval. Audrey Gallacher from Consumer Focus described it as ‘….a rare piece of good news’, and urged the other suppliers to respond with further cuts. She also advised customers to wait, because better deals elsewhere may be available imminently.

So will there be an energy price war? Industry experts believe so.

Andrew Horstead, from Utilyx – the energy and carbon advisors said ‘We have already seen a price war in the online market and we hope that this latest move will stimulate a similar response from the other suppliers to pass on lower cost to their beleaguered customers.’

The Department of Energy and Climate Change said ‘We have said for some time that householders must start to see the benefit of lower wholesale gas prices. This is very welcome news at a time when many will be facing the prospect of hefty winter bills. We expect to see other firms follow suit as quickly as possible.’

Sources:
http://www.independent.co.uk/news/uk/home-news/price-war-hope-as-british-gas-cuts-bills-1889928.html
http://business.timesonline.co.uk/tol/business/industry_sectors/utilities/article7015729.ece
http://news.bbc.co.uk/1/hi/business/8497488.stm