5 quick tips on switching power providers
Fancy switching power providers? Now is the time. The “big six” energy providers – that's British Gas, EDF Energy, E.ON, npower, Scottish and Southern, and Scottish Power – have all tipped their hand. It is now easier than ever to find the best tariffs. You may wonder if it is worth it, since the power rate cuts of anywhere from 3 to 10% hardly make up for the 42% prices rose last year. But it is easy enough to find the best rate and switch over that the answer is yes, it is definitely worth the few minutes it will take you.
Those paying the standard tariffs will benefit most from rate cuts, while those with the cheapest tariffs won’t notice much difference. But the thing is, if you’ve never switched providers, or are paying the standard “rack rate” you’re probably paying the most expensive rates. That makes it worthwhile to do some comparison shopping.
Here are 5 basic rules of thumb:
1. Online tariffs are almost always the cheapest, even if they haven’t changed with the recent reductions.
2.. The best deals require a monthly direct debit payment system.
3. There are two risks: if the company doesn’t adjust the debits frequently enough, you could overpay for several months thereby giving the power company an interest-free (though short term) loan.
4. Then again, you could underpay for several months, in which case you’ll be faced with a jumbo bill one day, probably the same day you get up to find the milk is sour and the cat has sicked up a hairball on the sofa.
5. Another thing to consider is that energy companies can now lock you into rather lengthy contracts in order to offer you the best rates. You could be faced with a cancellation fee if you switch before the contract is up.
It only takes a few minutes to go online and use this nifty comparison tool from MoneySuperMarket that helps you find the best deal depending on where you live and whether you’re a light, average, or heavy user of utilities. Once you’ve done that, you can make the switch right online. So there’s really no excuse. Even if you only save a few quid a month, every little bit helps in the current economic climate.