Monthly direct debit comes up trumps in energy bill battle

Brits looking to reduce their outgoings by cutting the costs of their utility bills should review their payment method, says moneysupermarket.com.

Research from the UK's leading price comparison site reveals bill payers languishing on their supplier's standard tariff and paying quarterly by cash or cheque (QCC), could save themselves a total of £2.3 billion per year or £170 per household on average by switching to the best online deal their provider has to offer and paying by monthly direct debit (MDD). Customers on Scottish Power's standard deal can save the most by swapping - they could be paying an average £1,064 on its Online Energy Saver 5 deal, a saving of almost £300 a year when compared to the standard offering.

Customers looking to cut costs even further could do so by switching from their current provider to the market leading Websaver 3 tariff offered by British Gas. This will cost around £1018.38 per year paying by MDD - a saving of over £200 on average if coming from a standard tariff and paying by QCC.

Scott Byrom, utilities manager at price comparison site moneysupermarket.com, said: "Paying by MDD should be the first port of call for people looking to save money. This option allows bill payers to spread the cost of their gas and electricity bills equally each month - rather than having to fork out for the large bill that lands on their doorstep each quarter. An online account allows customers to enter ‘actual' meter readings quickly and easily - ensuring they pay for exactly what is used, not an estimation.

"Changing to an online tariff gives consumers the opportunity to keep track of their payments and have a clearer idea of their balance by managing their account online. Online tariffs based on MDD payments are discounted because less administration is needed - so bill payers can cut out what can be poor customer service from call centres, saving cost, time and paperwork, in one fell swoop.

"Despite E.ON's price cut of 3.3 per cent to gas last week, British Gas' Websaver 3 tariff is still the current market leader, and provides an ideal option for people looking to save the most cash. Consumers should keep their eyes peeled however as there could be more cuts to follow. Scouring the market is crucial for those wishing to reduce their bills and find the best tariff to suit their needs."