Consumers warned not to disregard energy discounts

People are potentially losing out on an estimated £830 million in savings on their energy bills because they are not taking advantage of discounts available from suppliers, says uSwitch.com.

While energy companies have only cut prices by £84 this year, many consumers could cut their bills by a further £142 just by taking up the discounts on offer. And now, with the price war seemingly at a halt, these savings could be consumers’ best (or only) chance of seeing cheaper bills this year:

2.4 million (19%) dual fuel households are wasting almost £174 million by not paying energy bills by Direct Debit

4.2 million households are missing out on £42 million by not moving to dual fuel

12.5 million UK households (51%) are losing out on the cheapest energy prices because they are sticking to expensive standard plans rather than cheaper online plans

Supplier price cuts this year to date have saved dual fuel customers £1.4 billion. But consumers could potentially save a further £830 million just by taking up discounts

Households are potentially paying up to £142 each too much for their energy because they are disregarding readily available discounts, says uSwitch.com, the independent online comparison and switching service. While suppliers have cut prices by £84 this year, some consumers could double these savings by taking advantage of the discounts energy companies offer to those who move to dual fuel, pay by Direct Debit and sign up to an online tariff. The total saved could be as much as £830 million.

With the energy price war seeming to have ground to a halt and no news on the £200 still ‘owed’ back to households in price cuts following the fall in wholesale prices, these discounts now offer consumers the best chance of cutting their bills. And there is plenty of scope for households to benefit as recent uSwitch.com research reveals that 17% are not on dual fuel, 19% are not paying their energy bills by Direct Debit and 51% are on expensive standard plans rather than cheaper online plans.

Direct Debit

One in five dual fuel households currently do not pay their energy bills by Direct Debit. They could save up to £71 each or almost £174 million in total just by changing how they pay their bills. More importantly, consumers need to pay by Direct Debit to qualify for the cheapest energy deals – online plans - so switching to this payment method opens the door to further savings.

Dual fuel

Over 4.2 million British households – almost a fifth – are paying over the odds by having separate gas and electricity suppliers. This was the traditional way of buying energy before the market opened up. But now people can opt to get both from one supplier – dual fuel – and most suppliers offer a discount for doing so. For example EDF Energy’s discount comes to around £25. The average saving is £10, but again, being on dual fuel provides a great stepping stone to lower prices as it opens up the broadest range of the cheapest online deals.

Online

Over 12.5 million households in the UK are paying over the odds because they are on standard rather than online plans. Online plans are where suppliers are offering their best deals and cheapest prices and yet they seem to be the best kept secret in the energy market - only one in eight people are actually signed up to one. But the savings speak for themselves – for those who are already on dual fuel and paying by Direct Debit, signing up to an online plan will net a further £61 on average.

Geoff Slaughter, Energy Manager at uSwitch.com, says: “If consumers hoped the energy price war would result in chunky reductions in household bills then they look set to be sorely disappointed.

“Prices have only fallen by £84 and, with no further cuts on the near horizon, the best chance that consumers now have of seeing their bills go down is by taking advantage of the discounts being offered by suppliers. By moving to dual fuel, paying by Direct Debit and signing up to an online plan, households can reduce their bills by up to £142. There’s no point sitting back and waiting when three simple steps can save people more money than price cuts have so far to date.”