With many different ways to pay for your energy and different energy suppliers for you to choose from, it can sometimes be difficult to get to grips with all the options. This site aims to give you all the facts you need to make an informed choice that suits you.
For further information you can contact your energy supplier or for clear practical advice on consumer issues you can contact Consumer Direct on
08454 04 05 06 or visit www.consumerdirect.gov.uk.
Peace of mind
Your energy company has signed up to the Commitment on Direct Debit Arrangements which means they will make sure you are happy with how your Direct Debit works. You can expect to be told how refund processes work, whether different payment options may be more suitable for you, and how your payments will be reviewed to match the energy you use.
Before you sign up
Before signing up to pay by Direct Debit, your energy company will clearly explain to you how their Direct Debit payment scheme works. They will always comply with the Direct Debit Guarantee, which is offered by the banks and building societies to protect you. This means, that if an error is made by your energy company or your bank or building society, you are entitled to a full and immediate refund from your branch of the amount paid.
During your contract
If you choose to pay by Direct Debit, your energy company will:
- Base your monthly payment amounts on the best available energy usage data. This could be from your own and / or your energy company’s meter readings, information provided by you about your home and lifestyle, or a standard usage profile;
- Help you to budget by regularly reviewing your monthly payments to make sure your payments cover your energy use over the year;
- Explain any changes to your monthly payment ahead of time;
- Discuss the amount you pay if you ask them to, and,
- Agree to change the amount you pay if appropriate.
What does paying for energy by Direct Debit mean?
Paying for your energy by Direct Debit can help you to budget your monthly outgoings because you will pay the same amount each month. This means you may underpay in the winter when you use more energy and overpay in the summer months when you use less, but this will balance out over the year. If there are price changes during the year, this may change your monthly payments. You can always talk to your energy company if you have any questions.
How can I be sure my Direct Debit is set at the right amount?
Your energy company will use past energy use to set your Direct Debit payments for the coming year. The best way to make sure this is accurate is to provide your energy company with a meter reading on a regular basis, such as every three months. You can do this easily by taking down the number on the meter and calling your energy company, or filling in a form on their website. Also, changes to your personal circumstances, such as the arrival of a new baby or someone leaving home, can change how much energy you use. To check that your Direct Debit level is still set at the right amount, let your energy company know about any changes like these.
Advantages
- Using Direct Debit is almost always the cheapest way to pay for your energy
- Fixed payments allow you to spread the cost of your energy over the year, which means no unexpected large bills in the winter
- You don’t have to remember payment dates and there is no need to write and post cheques so you save time and money
- You have more control over when you pay your bill
- Your annual energy costs will be spread over the year in more manageable monthly instalments, which can help budgeting
- Your payment is protected by the Direct Debit Guarantee. This means, that if an error is made by your energy company or your bank or building society, you are entitled to a full and immediate refund from your branch of the amount paid
- You can cancel a Direct Debit at any time by writing to your bank or building society
- Your energy company is required to give you written notice (usually 14 days) if they want to change the date or the amount of your payment
Disadvantages
- You have to make sure there is enough money in your account to cover the payments, as money will be withdrawn automatically on the agreed, chosen date
- Your Direct Debit may be set too high or low if it is based on an estimation of usage, so it is important that you always phone in regular meter readings to your energy company
Further information
If you have any questions or complaints about your Direct Debit, your energy company will handle them quickly and effectively.
For more information on Direct Debits, please contact your energy company directly. They will be more than happy to help you.
You can also contact Consumer Direct for clear practical advice on consumer issues on 08454 04 05 06 or visit www.consumerdirect.gov.uk or www.bacs.co.uk.
This information is produced with the kind co-operation of Bacs, the company behind Direct Debit in the UK.
What is standard credit?
You may receive a bill once a month or more usually once a quarter based on an estimate of how much you’ve used or the exact amount if based on a meter reading. You then pay for this by credit or debit card, either by taking your bill into the bank or post office to pay it in cash or by cheque, or by cheque through the post.
Why pay by standard credit?
Standard credit allows you to control when money leaves your bank account and the means by which you pay. There are a number of ways for you to pay the bill and energy companies will accept payment over the phone or online, which many people find convenient.
Advantages
- This payment method allows you to control when the money leaves your account
- It is the most traditional way of paying bills – you may be more comfortable receiving bills this way
- Standard credit may be useful for shared houses
- You have more than one way of paying your bill
Disadvantages
- Payments can’t be staggered and may be larger than you expected
- Some banks and building societies may charge a fee for processing bill payments
- You won’t be able to take advantage of any of the extra discounts offered by energy companies such as those for direct debits
What is a pre-payment meter?
Pre-payment meters allow you to put in a key or card, which you ‘charge up’ with cash to pay for your energy. Paying for your gas and electricity up front this way helps you to budget effectively and is a popular way for many customers to pay for their energy.
Why choose a pre-payment meter?
Pre-payment meters are popular with many different types of customers for the same reasons pay-as-you-go phones are so popular. They help you to be flexible in how you pay for your energy, and give you control over how much money you spend and when you spend it.
How do I get a pre-payment meter?
You can contact your supplier and request a pre-payment meter. There may be a charge for replacing your meter, but your supplier can talk you through your options and arrange for a new meter to be installed.
Once I have my meter, where can I buy credit?
Once I have my meter, where can I buy credit? You can top up your pre-payment meter card or key at outlets displaying the PayPoint or Payzone logos around Britain, or at your local Post Office. You should ask your supplier which top up network it uses. Top up points are usually located in convenience stores, petrol stations and newsagents because of their accessibility and long opening hours. You will receive a receipt after every payment and credit will be transferred to your meter as soon as you insert your card/key.
Will I receive statements from my energy company?
All suppliers issue a yearly statement, but your supplier will tell you if and how often it will send more regular statements. It will also provide you with other relevant advice, such as when it may be necessary for your pre-payment meter to be adjusted following a change in the price of your gas and electricity. Remember it is important to allow your energy supplier to gain access to your pre-payment meter if they need to update it.
Advantages
- You pay exactly for what you use, just as with pay-as-you-go mobile phones
- Pre-payment meters make it easier for you to budget
- You have the reassurance of knowing you won’t overspend on your energy
- The meter shows you how much you are using so you can keep track and not worry about an unexpected large quarterly bill
- Pre-payment customers don’t have to worry about estimated bills or meter readings
- If you are in debt with your energy company you can repay your debt in small amounts each time you top up your prepayment meter, instead of via a larger one off payment.
- Prepayment meters come with a certain amount of ‘stand-by’ credit on them, which means that if you run out of credit you will not be disconnected, though the next time you top up your card you will need to pay for any additional energy used. Your supplier will be able to give you the details of how this will work for you.
Disadvantages
- You can’t take advantage of online discounts or direct debit discounts
- Pre-payment meters cost more for energy companies to provide, so in some cases this additional cost is passed on so paying this way could be more expensive
- If you do not purchase enough credit using your top-up device you risk being temporarily without gas or electricity
- Your energy company may need to gain access to your meter when it is time for it to be updated
Variable or quarterly Direct Debit
Direct Debit payments are taken directly from your bank account by your energy company. The payments come out on a particular date. As well as a standard monthly Direct Debit, you could choose:
- Quarterly fixed – a fixed amount comes out of your bank account every quarter on an agreed date. This allows you to spread payments out but the payments will be larger than if you were making them monthly, so you will have to budget well to ensure you have enough money in your bank to make them.
- Variable – your actual energy bill is deducted from your bank account at the end of a fixed calendar period (for example every quarter or six months). You are only paying for the gas or electricity you use so the payments will vary in amount, with higher bills likely in winter than in summer.
Advantages
- All the advantages that apply to Direct Debit payments generally will also apply to variable payments. The main difference is that you only pay for the gas or electricity that you use, in the period in which you used it.
Disadvantages
- Your bill payments won’t be spread evenly throughout the year.
Credit / Charge Card
There are two main ways to pay for your energy with your credit or charge card.
- Calling your energy supplier, following receipt of your bill and charging it to your card;
- Paying your bill automatically with your card under a Continuous Authorised Transaction (CAT). With CAT schemes, your actual or projected annual energy bill is divided into periodically equal instalments (monthly or quarterly) and automatically billed to your card.
Charge card payments work in the same way as credit card payment schemes. The main difference is that you must clear your charge card account by the due-date; therefore your interest free period is shorter. However, if you pay your energy bill using your charge card, you will benefit from any loyalty schemes offered by the charge card company.
Advantages
- Other than the potential savings on offer, credit card payment also gives you an additional interest free credit period, which can be anything up to 56 days, before you have to pay your bill;
- It allows you to obtain additional benefits applicable to the credit card of your choice, such as Barclaycard Reward Points.
Disadvantages
- CAT schemes don’t offer the same level of protection as Direct Debit schemes. If errors are made with your payments you need to rely on your supplier correcting them;
- If you want to cancel a CAT, you need the authorisation of the company debiting your card. This will normally happen automatically if you decide to change your payment method or switch supplier;
- If you forget to pay your credit or charge card bill on time you will have to pay interest on the unpaid bill at the monthly rate applicable to the card.
Fuel Direct
Fuel direct, or the Third Party Deduction Scheme, means that if you are in receipt of certain benefits and are in debt to your gas or electricity company, you can have an agreed and affordable amount taken out of your benefits and paid directly to your energy company. It is operated by the Department for Work and Pensions (DWP). Third party deductions like these are only made when it is agreed that it is in the interests of you or your family. Providing the option of paying via Fuel Direct is part of domestic gas and electricity companies’ licences.
How does it work?
Your local benefit offices will agree the deductions with you and your energy company. The office will then arrange your payments to your energy company by automated credit transfer every four weeks. The payments cover what you are currently using and the debt you owe.
Paying by Fuel Direct can help you to manage your finances and takes away the worries you might have about contacting your energy company to repay debt. It can also mean that you can access additional services that suppliers offer, such as the Priority Services Register – a special service for elderly or disabled people and those living with long-term health conditions. It includes bills in easy-to-read larger text or in Braille, as well as security passwords and a free annual gas safety check.
Who is it for?
Fuel Direct can be only be used when all other payment methods have been tried or when it is not possible to fit a Pre-Payment Meter (PPM). It can be used to pay outstanding gas and electricity debts, pay for your current use of energy and to make sure you don’t build up any further debt.
Support provided by suppliers can take many different forms:
- The Warm Home Discount scheme which helps vulnerable customers on a low income through a rebate which is credited to the electricity account.
- Energy efficiency, debt and income advice is offered to help customers manage their energy use and reduce their bills
- Many suppliers offer grants to vulnerable customers who are in debt
- All suppliers offer a Priority Service Register (PSR) to provide peace of mind to vulnerable customers
Alongside their individual schemes, energy suppliers also fund the Home Heat Helpline, a service providing advice and assistance to those who may be struggling with their energy bills.
The Helpline – 0800 33 66 99 – was set up in 2005 and gives help and advice to low-income and vulnerable households. The Home Heat Helpline also handles calls from carers, care professionals and advice agencies. Find out more at the Home Heat Helpline’s website.
My Money Steps is an online debt advice service run by National Debtline providing free independent, confidential advice 24 hours a day.
Warm Home Discount
If you qualify for the Warm Home Discount (WHD), you’ll receive a letter letting you know that you whether you need to apply, or if you get it automatically. Find out more about eligibility for the WHD.
Energy efficiency, debt and income advice and support
Yes – through the British Gas Social Housing Scheme, Here to HELP programme, Help the Aged Partnership and Energy Savers Report.
Support includes loft and cavity wall insulation, draught proofing, fuel switching, microgeneration, radiator panels, hot water tank jackets, safety and security products, council tax rebate and free energy efficiency advice.
Grants
Yes – through the British Gas Energy Trust.
Support includes grants to meet arrears, debt advice referrals and charitable funding.
Priority Service Register
Yes – through the Home Energy Care Register.
Support includes pre-arranged passwords, safety products, advice booklets, bills in Braille, and free gas safety checks.
Warm Home Discount
If you qualify for the Warm Home Discount (WHD), you’ll receive a letter letting you know that you whether you need to apply, or if you get it automatically. Find out more about eligibility for the WHD .
Energy efficiency, debt and income advice and support
Yes – through London Warm Zone, WRVS Energy Advice Project, Safe Warm and Well campaign, Priority Group Insulation Offer and the Devon and Cornwall Energy Advice Project.
Support includes energy efficiency advice, benefits entitlement assessments, debt advice referrals and access to insulation and new central heating.
Grants
Yes – through the EDF Energy Trust Fund. Support includes grants to meet arrears and charitable and third party agency funding.
Priority Service Register
Yes.
Support includes quarterly meter reads, special bills, moving meters to more accessible locations, gas safety checks and energy efficiency advice.
Warm Home Discount
If you qualify for the Warm Home Discount (WHD), you’ll receive a letter letting you know that you whether you need to apply, or if you get it automatically. Find out more about eligibility for the WHD.
Energy efficiency, debt and income advice and support
Yes – through CaringEnergy and the Age Concern Energy Service.
Support includes free and discounted cavity wall and loft insulation, free energy efficiency advice and home efficiency audits, free low energy light bulbs and benefits entitlement checks.
Grants
Yes – through the CaringEnergy Fund and the Age Concern Energy Service.
Support includes grants for insulation, heating measures and replacement of essential household items.
Priority Service Register
Yes. Support includes free or discounted gas safety checks, quarterly meter reads, special bills, a password protection scheme, meter moves and controls to make appliances easier to use.
Warm Home Discount
If you qualify for the Warm Home Discount (WHD), you’ll receive a letter letting you know that you whether you need to apply, or if you get it automatically. Find out more about eligibility for the WHD.
Energy efficiency, debt and income advice and support
Yes – through Community Warmth, Health Through Warmth, Spreading Warmth and the First Step programme.
Support includes free Home Energy Surveys, energy saving light bulbs, benefit entitlement checks, energy saving advice, referral to debt advice agencies and free or subsidised cavity or loft insulation and heating measures.
Grants
Yes – through the First Step Fund.
Support includes grants to meet arrears.
Priority Service Register
Yes – through the Warm Response Service.
Support includes special bills, a password scheme, quarterly meter readings, translation services and free gas safety checks.
Warm Home Discount
If you qualify for the Warm Home Discount (WHD), you’ll receive a letter letting you know that you whether you need to apply, or if you get it automatically. Find out more about eligibility for the WHD.
Energy efficiency, debt and income advice and support
Yes – through the Community Liaison Programme and Social Responsibility Support Team.
Support includes energy efficiency advice and audits, referral to grant-making bodies, cavity wall and loft insulation, hot water tank jackets and fuel switching.
Grants
Yes – through the ScottishPower Energy People Trust
Support includes funding for not- for-profit organisations working with vulnerable people.
Priority Service Register
Yes – through the Carefree Register.
Support includes gas safety checks, a password security scheme, special bills, replacement meters and energy efficiency advice.
Warm Home Discount
If you qualify for the Warm Home Discount (WHD), you’ll receive a letter letting you know that you whether you need to apply, or if you get it automatically. Find out more about eligibility for the WHD.
Energy efficiency, debt and income advice and support
Yes – through energyplus Care and the Citizens Advice Bureau Partnership. Support includes free or subsidised insulation, energy efficiency advice and free or subsidised fridges and other appliances.
Priority Service Register
Yes – through Careline. Support includes a helpline, password scheme, special meter readings, a knock and wait scheme, advice on keeping warm and free gas safety checks.
Why switch?
Energy suppliers compete against one another on price, service and types of deals. That is why it’s important to have a look at what is available and find a deal that’s perfectly suited to you.
It is also possible to stay with your existing energy supplier and simply switch tariffs. They will be able to discuss the different tariff options available to you and if you decide to switch, they will explain the process to you.
Over 100,000 people change energy tariffs or suppliers every week and the process is easier now than ever before. Follow the simple steps opposite and find out how easy it is to switch.
Step 1: What do I need?
If you’re thinking about switching, have your existing supplier’s details handy and as much information as you have about how much energy you have used over the past 12 months. This can all be found on your gas or electricity bill. You can then contact other suppliers or comparison websites by phone or on the internet to find out what the best deal is for you.
Step 2: Starting the process
Now you’ve found the best deal for you – it’s time to get going. Once you have agreed your new contract, you will receive a letter from your new supplier within 7 working days confirming all the details. During the next couple of weeks, your new supplier will also contact your old supplier to let them know the switch is taking place.
Step 3: The technical bit
Your new supplier will ask you for a meter reading – it’s really important that you provide a meter reading to your new supplier when they ask – which will make sure you are billed for the correct amount and from the right start date. Your new supplier will make sure your old supplier has this meter reading so that the process runs smoothly. They will also let you know the date at which your supply will be switched so you can make sure your payments to your old supplier stop at the right time.
Step 4: Switch completed
The whole process should take no more than 6 to 8 weeks to complete. You should check your final payments to your old energy supplier and make sure they have billed you up until your opening meter reading. If you have any worries during the process, speak to your new or old supplier and they will work together to resolve any problem quickly. At no point during the process will your supply be interrupted.
Switching Supplier
Peace of Mind Guarantee
Energy suppliers are committed to working together to ensure that the switching process is as simple as possible. We will work together to guarantee that:
- The switching process is straight-forward for you;
- You are given advice on potential savings to the best of suppliers’ knowledge based on the information available;
- You will be provided with the information you need during the switching process and will be able to contact your old or new supplier if you have any enquiries;
- If you report a problem, it will be recorded and addressed. Any complaint will go through the various stages of the supplier’s complaint handling process, including any appropriate redress. If you believe that you have been transferred to a new supplier without your consent, you can contact either your old or new supplier. The contacted supplier will work together with the other supplier to ensure the matter is resolved as quickly as possible;
- If this happens, the supplier you contact should explain to you:
- What action will be taken to return you to your original supplier;
- When you can expect to be transferred back to your original supplier;
- That you will only pay once for the energy you have consumed;
- How you will be kept informed during the process
- The contacted supplier will send written confirmation of the above information within 5 working days of you contacting them. Where possible, the supplier will include an explanation of why the transfer took place;
- Within 20 working days, the contacted supplier will either confirm that you will be returned to your old supplier or, if not, explain why and when you will be returned.
Frequently asked questions
What questions should I ask so I get the best deal?
You should ask what tariffs, product and services the new supplier has available, the savings you could make and the terms and conditions of any new deal, e.g. is it a fixed price product?
What can I expect from my new energy supplier once I’ve signed up?
You can expect your new supplier to explain the switching process to you, including how long the process should take, and that any unpaid bills or debts owed to your current supplier may affect your ability to switch.
What happens if I change my mind or I’m unhappy about something?
You can cancel your new contract if you change your mind during the cooling off period. This is 7 working days after you have received your confirmation letter from your new company, or 7 days after you signed a contract with a sales agent face to face.
What happens if I have a problem?
If you have any problems or concerns during the process, contact your new supplier who will work with your old supplier to make sure any issues are resolved quickly. If you believe you have been switched without your consent, contact either your old or new supplier and they will work together to put things right.
What happens if my problem is not resolved?
Your new supplier will make you aware of its complaints handling process which you can refer to at any stage of the switching process should you have a problem. Your supplier will work with you to sort the problem out. However, if you are still unhappy, contact the Energy Ombudsman on 0330 440 1624. or visit their website at www.ombudsman-services.org/contact-us-energy.html
Further information
Ofgem has a Confidence Code for online switching sites to ensure consumer receive accurate, comprehensive and unbiased price comparisons. The Confidence Code sets out the minimum requirements that sites must meet in order to be, and remain, accredited by Ofgem. For more information go to: www.ofgem.gov.uk
Citizen’s Advice give clear and practical advice on consumer issues – find out more at their website: www.adviceguide.org.uk