hit tracker Exact date you must make vital energy bill move – or risk being overcharged – Newsmix.pics

Exact date you must make vital energy bill move – or risk being overcharged

MILLIONS of households must make a vital move ahead of a big change to energy prices coming in days.

Bills are set to fall by £238 a year for the average home from April 1.


Households must take a meter reading on Sunday ahead of a big energy price cap change[/caption]

The energy regulator Ofgem confirmed the new price cap last month, and it comes into effect on Monday.

The cap will fall from the current rate of £1,928 a year to £1,690.

But bear in mind that the price cap is reviewed every three months, so your annual bill could still change.

But households need to make sure they have taken a meter reading before midnight on March 31.

An updated meter reading helps stop your supplier from determining bill prices that aren’t accurate to your usage.

In addition, if you are disputing a bill, taking a meter reading is a must.

If it’s lower than your estimate, you can ask your provider to lower your monthly direct debit to a more suitable amount.

The energy price cap works by setting a limit on the maximum amount suppliers can charge for each unit of gas and electricity.

It’s not a cap on how much you can be charged for the energy that you use – so if you use more, you’ll pay more.

Below we explain how gas and electricity rates are changing and how you can calculate your bill.

How are gas and electricity rates changing?

Currently, a typical household that pays their energy bill by direct debit pays the following rates:

  • 7.42p per kWh for gas
  • 28.62p per kWh for electricity
  • A standing charge of 29.60p per day for gas
  • A standing charge of 53.35p per day for electricity

But from April 1, Ofgem will introduce the following new rates:

  • 6.04p per kWh for gas
  • 24.50 pence per kWh for electricity
  • A standing charge of 31.43p per day for gas
  • A standing charge of 60.10p per day for electricity

How do I calculate my energy bill?

BELOW we reveal how you can calculate your own energy bill.

To calculate how much you pay for your energy bill, you must find out your unit rate for gas and electricity and the standing charge for each fuel type.

The unit rate will usually be shown on your bill in p/kWh.The standing charge is a daily charge that is paid 365 days of the year – irrespective of whether or not you use any gas or electricity.

You will then need to note down your own annual energy usage from a previous bill.

Once you have these details, you can work out your gas and electricity costs separately.

Multiply your usage in kWh by the unit rate cost in p/kWh for the corresponding fuel type – this will give you your usage costs.

You’ll then need to multiply each standing charge by 365 and add this figure to the totals for your usage – this will then give you your annual costs.

Divide this figure by 12, and you’ll be able to determine how much you should expect to pay each month from April 1.

How do I take a meter reading?

How you take a meter reading can vary depending on the type you have, and we explain it in further detail below.

There should be a digital display or dial with numbers on it, which you can then report to your supplier.

If you’re not sure which numbers to use, Citizens’s Advice has a handy guide.

Once you have the numbers you should be able to submit them to your supplier.

This can be done in several ways depending on which supplier you’re with – such as via app, text message phone or website – so check with your supplier.

It is always worth taking a picture of your meter reading when you submit it to your supplier – just in case you need it as evidence for a future dispute.

Below we explain the two ways you can take your meter reading based on the type you have.

Electricity meters

If you have a digital electricity meter, you will just see a row of six numbers – five in black and one in red.

Take down the five numbers in black and ignore the red number.

If you are on an Economy 7 or 10 tariff which gives you cheaper electricity at night – you will have two rows of numbers, so take both readings down.

If you have a traditional dial meter you will need to read the first five dials from left to right ignoring any red ones.

If the pointer is between two numbers, write down the lower figures and if it is between nine and zero write down the number nine.

If the dial is directly over a number, write down that number and underline it.

If you’ve underlined a number, check the next dial to the right.

If the pointer on that dial is between 9 and 0, reduce the number you’ve underlined by 1.

For example, if you originally wrote down 5, change it to 4.

Gas meters

If you have a digital metric meter showing five numbers and then a decimal place, you only need to write down the first five numbers from left to right.

If you have a digital imperial meter your meter will read four black numbers and two red numbers – note down the four black numbers only.

If you have a dial gas meter, follow the same steps as those for those with a dial electricity meter, but ignore underlining any figures.

What else has been announced?

Standing charges

Ofgem is “levelising” standing charges to “end the inequity” of people with prepayment meters.

This means that people who pay for their energy using a prepayment meter will pay the same standing charge as those who pay by direct debit.

The government first tackled the so-called prepayment premium last year, bringing them in line.

Before that, those who used “pay as you go” gas and electric paid up to £45 more than those who were billed and paid by direct debit.

Ofgem said the solution must be funded by bill-payers rather than taxpayers, to maintain fairness, meaning prepayment customers will save around £49 per year while direct debit customers will pay £10 more each year.

Separately Ofgem is reviewing the standing charge, though any further changes as a result are likely to be some time off.

The standing charge is a set daily amount charged for gas and electricity, regardless of usage.

Bad debt charges

Energy firms were already able to charge £842million a year on bills for bad debt allowances.

But last month, Ofgem announced that an additional £735million can be charged – this works out to £28 per household a year.

Although, this is partly offset by a £275million adjustment to the bad debt charges incurred after the Covid pandemic, which worked out at £11 per household a year.

Charity Warm This Winter published a report this week revealing that the combined impact of these bad debt charges will amount to up to £130 a year for millions of households.

Bad debt refers to the amount of money owed by customers that is unlikely to realistically be paid back.

These charges are paid to suppliers to help cover these losses so they can help support struggling customers.

The level of bad debt has soared in recent years due to increases in wholesale energy prices and the wider cost of living crisis putting pressure on household finances.

The exact amount you’ll be charged depends on how you pay for your energy.

To see how much you’ll pay see our story.

Ban on BATs

The regulator has also announced it is extending the ban on acquisition-only tariffs (BATs) for another 12 months.

But it says it plans to open a consultation to consider shortening this extension to just six months.

The BAT was introduced in April 2022 to remove the often risky short-term discounted tariffs intended to attract customers from other suppliers.

Market Stabilisation Charge axed

Additionally, from April 1, the Market Stabilisation Charge – introduced along with the BAT – will come to an end.

This means suppliers are no longer required to compensate a new customer’s previous supplier when they switch.

The move was welcomed by consumer champion Martin Lewis who says the charge had stopped firms from offering “properly cheap” switching deals.

Which? has advised that with the price cap predicted to remain fairly stable for the rest of 2024, more competitive deals may become available in the coming months.

The watchdog said: “As a rule of thumb, we wouldn’t recommend fixing a contract longer than 12 months, higher than the April price cap or with significant exit fees in case circumstances change and you want to switch to a better deal.”

What can you do now?

In the past, switching suppliers was the best way to save money on energy bills but since the energy crisis began there hasn’t been much point due to a lack in competition.

This is due to many firms pulling their best offers, partly due to the Market Stabilisation Charge – which is now being axed in April.

Some fixed deals are currently available for close to the April price cap but groups like Which? have warned most of these deals will save consumers very little.

If you are looking to move now though, make sure to do your research.

Some deals have exit fees included that would eat into the savings you’d make by switching.

These exit fees are found on fixed energy deals, not on standard variable rates.

You can compare the best deals using price comparison sites like MoneySupermarket and Uswitch.

It might also be worth checking with your current supplier if there’s a cheaper deal they can offer you instead.

We’ve listed eight steps to take now to save on your energy bills.

Do you have a money problem that needs sorting? Get in touch by emailing squeezeteam@thesun.co.uk.

Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories.

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