Understanding Energy Bill Price Hikes

Understanding Energy Bill Price Hikes

Nobody likes a price hike but energy companies are well within their rights to up your bill under certain circumstances, such as the government increasing VAT or if you signed up to a tariff that outlined future price changes in advance.

The catch is that they have to inform 30 days in advance, so you have time to switch providers or tariffs. If you are on a prepaid meter you will only be given 7 days warning of a price increase. The only time they do not have to inform you of an increase is when you’re already on a variable rate tariff, which means you have already agreed to price fluctuations.

If your energy supplier fails to adequately inform you of price increases you should consider filing a formal complaint through their complaints procedure. If this doesn’t go the way you desire, you can also escalate things by contacting the UK energy ombudsman.

Shop Around

Although it can be a hassle, the best way to avoid price hikes is to regularly shop around for a better deal with another supplier. There are many websites that will allow you to do a price comparison search and take you through steps of switching.

You’ll need to be quick however if you’re switching after you’ve been informed of a price increase, so everything is finalised before your first bill. Regulations state that if you are moving to a different tariff with your existing provider or switching to a new one, they must complete the process within 20 working days after the first day of the price increase.

Remember to pay off any arrears before switching, else you current supplier is within their rights to halt the switch until you’ve paid the full balance.

Prepare For Contract Renewal

All fixed rate contracts have an end date, at which point you will be moved over to the provider’s current standard tariff. This will almost always cost more than you previous bill, so it is important to prepare in advance for the end date.

You will be given a warning up to 49 days in advance, at which point you can opt to switch providers or choose a new tariff with your current provider. You will not have to pay a fee for leaving your current provider if you are at the end of the contract.

You should file a complaint if they don’t notify you in advance that your contract is coming to an end, if they try to charge you for switching to a new provider, or if they automatically renew the contract or move you to another tariff without informing you.

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