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The Big Six Energy Suppliers Vs The Rest

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Is It Right To Reclaim Bank Charges?

Published in Household Bills on 1 September 2008

We round up the energy-price increases from the big suppliers, compare them with smaller suppliers, and give you several fresh, new tips!

Now that all six of the major energy providers have increased their tariffs, let’s take a look at the increases:

Energy price increases this summer

Supplier

Date announced

Gas increase (%)

Electricity
increase (%)

British Gas

30 July

35

9

E.ON Energy

21 August

26

16

EDF Energy

25 July

22

17

Npower

28 August

26

14

Scottish and
Southern Energy

21 August

29

19

ScottishPower

28 August

34

9

Average

 

28

14

Data provided by Xelector, which powers The Fool’s gas and electricity comparison tool.

Back in 2005 we paid £675 for gas and electricity on average, according to OFGEM. Now, extrapolating from the latest OFGEM figures I can find, I calculate we pay £825 for gas alone. Combined with electricity we pay on average £1,300, so roughly double the 2005 amount.

Florian Ritzmann from Xelector agrees that £1,300 is the official figure but, as he says, no one believes that. He believes the real average figure we pay is closer to a huge £1,600.

Are these price rises merely greed?

Age Concern, Child Poverty Action Group and National Energy Action will lobby the Government today over a combination of huge numbers of households in fuel poverty and soaring energy company profits. 5.5 million unfortunate people are now classed as being in fuel poverty. Meanwhile, energy company profits have doubled, Age Concern says, since 2006, having risen from £2bn to £4.3bn.

Clearly, then, rising energy prices aren’t just about increased costs to suppliers.

Smaller suppliers

It’s not easy to get figures for smaller suppliers. I carried out a number of random searches with The Fool’s tool to test it out. I had to bear in mind that British Gas’ and E.ON’s cheapest tariffs* have yet to go up. Same with Telecom Plus (Utility Warehouse), Good Energy, Spark Energy and Green Energy UK.

With so many small suppliers to increase their prices I found it too hard to see the trend as yet. We’ll have to keep you informed. However, I did find that Ebico frequently came top for those of us who use little energy, so you may see them at the top when you compare prices.

Anyway, here are some tips for people who are struggling with their fuel bills:

Three tips if you’re struggling with your bills

If you are already struggling with your bills or are in arrears at this time of year (when your usage is lower than winter) then that is a sign of trouble ahead. Contact your supplier to discuss your options. Here are the rules about being in debt to your supplier:

  • If you are in debt as a result of inaccurate billing, the repayment of that debt should take as long as it took to run up the debt.  If, for example, you have not been billed correctly for a number of years, your repayments should take just as long.
  • Several Trust Funds exist to help people in serious difficulties – your supplier will know about these and will be able to tell you about your eligibility. Ask your supplier for an ‘entitlement check’ to find out what help is available.
  • If you believe you are at risk, and someone in your household is of pensionable age, disabled or chronically sick, ask your supplier to add you to the ‘Priority Services Register’, which can be useful if you find yourself in debt later. If you are on that list, the supplier should offer you additional assistance.

*British Gas’ Click Energy version 5 and E.ON’s EnergyOnline Extra Saver version 8.

More: Save Money Now With A Fixed Tariff

> Compare energy prices via Fool.co.uk

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Comments

The opinions expressed here are those of the individual writers and are not representative of The Motley Fool. If you spot any comments that are unsuitable hit the flag to alert our moderators.

LateDeveloper 02 Sep 2008, 4:32am

Please be polite and on topic when you post.

The only thing I can promise is being on topic, however as far as the energy companies are concerned, I don't have a single polite word to say about them, I think their profit margins speaks volumes on what these companies are like and feel that the regulator should step in and penalise them heavily.

brewerdave 02 Sep 2008, 7:38am

Having just decided to change to a fixed 1 year tariff I offer 2 comments as a result of trawling the various sites:-
1. The number of different tariffs from even a single Company is becoming too great.
2. It is becoming ever more difficult to actually obtain the unit costs for these deals - " check our prices" links frequently lead to comparison pages where you have to enter your details; even after this you rarely get what you want ie the raw price per unit data.SWALEC are particularly bad - I still haven't managed to find actual tariffs on their site!!

brewerdave 02 Sep 2008, 7:44am

Further comment on fixed deals - I have just taken a 1 year deal with Scottish Power - just before they announced their price rises - it is actually less than I was paying SWALEC BEFORE their latest price rise - crazy or what?

poshchap 02 Sep 2008, 7:47am

This is blatant profiteering - first of all these companies pay the wholesale price for a fraction of their total energy supply (most of it comes from very long term supply deals) so the wholesale price is largely irrelevent.

Secondly, these companies retail divisions buy their energy from their own wholesale companies - guess where they declare the profit!

ancientaviatior 02 Sep 2008, 8:03am

I'm afraid that scrabbling around energy suppliers looking for “Best Deals” is not going to save significant amounts of money. Deregulation was supposed to give us competition and keep prices low, HA! It was an illusion, all we have is "Confusion Marketing" and it's still a monopoly. We have become complacent and waste energy up to now. It's time to knuckle down and find ways of reducing our usage. Out household has managed to reduce our energy bill by 33% this year. It's not been a doddle, it takes discipline and a commitment, but it can be done.

HouseBug 02 Sep 2008, 9:02am

I read somewhere that energy costs on mainland Europe are as much as 30% less than in the U.K. Add foreign ownership of some of these companies to the equation and I sense that someone is subsidising their own domestic market at the expense of the market here in the U.K. This problem is further compounded by the fact that viable energy alternatives are almost non existent in the U,K.

Ancientaviator is right; there's little choice any more but to reduce your consumption.

BrokenNotBroke 02 Sep 2008, 9:04am

http://www.ebico.co.uk

They are a "non-profit" energy supplier, and charge the same if you are on a pre-pay meter, or pay monthly via direct debit.

Unlike others, they even openly show their prices!

Been with them for 3 years, completely trouble free. Southern print the bills, but it's the Ebico price I pay. Marvellous :-)

204panadil 02 Sep 2008, 9:22am

Ancientaviator and housebug are both right - there is little sense in chasing around looking for cheaper tariffs. I think this is a conjuring trick to distract public attention from the real problem. For the cost of two aircraft carriers or of the Min of Defence refurbished London HQ (£2 billion +) we could have tidal and wind power enough to make a big difference and on our own doorstep, not at the end of a politically sensitive pipeline from Siberia. I'm replacing an old gas fire by a solid fuel stove in 2 weeks time which I hope will keep me and the house warm through next winter and cut my gas bill significantly. I might even be able to use it to make toast!

NickTaylor42 02 Sep 2008, 9:40am

house bug
i have a home in france,there is no gas,iam with "soregies" which is pretty much to my knowledge sole supplier in france,although i believe brussels is going to allow an uk type free for all soon.
I pay £135 standing charge per annum. My fixed cost for all usage is 6.55p per Kw. In additon i pay 3.85p for usage between 12.30p.m. and 2.30pm (day) and the same between 23.45 and 05.45 am. Which means for running washing machine,dishwasher,tumbledryer during the two hour special during day is "cheap as chips"
i also get CSPE of £6.45(compensation rebate) for 2008
I am with standard tariff with scottish power and i pay 17.995 per Kw and 11.43p after certain usage
I cant remember the last time i saw uk electric at under 7.00 p,so i think you have avery valid point even if i dont know the actual owners of "soregies"

JugPenKettle 02 Sep 2008, 9:56am

Last time I changed supplier, two or three years ago, I had a hard time finding the price of electricity and gas on supplier's websites. I ended up 'phoning my supplier and asking them - and wish that I had known about "saynoto0870.com" back then. I even had a hard time using Uswitch to get the detail that I wanted. In the end I went in blind and accepted their recommendation. This time - I am going to switch soon - I think I shall try to be a bit more rigorous.

But doesn't all this political to-do with Russia make you nervous about the price and security of our gas supply. When we replace our old gas boiler I think I will try and design the installation myself to "future-proof" it. I am thinking of solar water heating and dual electric immersion heaters.

TMFVertigo 02 Sep 2008, 10:07am

Hey

Good comments as usual, folks, thanks.

brewerdave, you said: 'The number of different tariffs from even a single Company is becoming too great.'

Too right! For years there have been thousands. The only reason is to confuse us.

You also said: 'It is becoming ever more difficult to actually obtain the unit costs for these deals.'

You can get unit prices from the results page when using The Fool's comparison tool. Just click on 'more details' in the Tariff column.

ancientaviator, I admire your energy-bill reductions (33%) through energy-saving measures. However, you said that comparing deals is a waste of time (I'm paraphrasing). If only it was that easy. Sadly, if you don't switch to the new tariffs (or new versions of the same tariffs) periodically, your tariff will rise faster over time. It is just new customers who get the best deals, and those deals are subsidised by the people who don't switch.

Neil (the author)

noony29 02 Sep 2008, 11:08am

There is one word for all these unecessary fuel price rises, when all the companies are making millions in profit, and that is "ROBBERY".
I had Solar power fitted in July and although I should not think it would pay for itself in my lifetime (as it is reckoned average 15 years to get your money back) I have used NO GAS at all since it was installed and get piping hot water all I need. I use my microwave to cook by mostly. I personally think that is the only way to go at the moment and I am sure that the price of installation will come down in time as will they improve the system to include heating as well. I did change to a capped rate earlier on this year, so am stable until Oct next year. Anyone who can possibly afford it, have it installed, it will help your fuel reduce your fuel bills no end. Everyone I know have told me that their bills are so low since the Solar has been installed.

roderickeaton 02 Sep 2008, 11:13am

France, of course does not suffer the heavy (government created) so called 'green obligation' as we do because France had the sense to ignire the Greenies many years ago resulting in a much higher nuclear electricity contribution (around 75 to 80%).

Our electricity suppliers have to build silly windmills at ridiculous costs and seek lower carbon emission technologies for coal and gas. This coutry is well on the road to so called 'combat man-made climate change' inspired self-destruct! People are just missing the costs of the flawed doctrines of the Intergovernmental Pranksters on Climate Change further exaggerated by Water Melon Green Brown and his Stern report.

notbighead 02 Sep 2008, 11:23am

The real reason for these price increases could possibly be the fact that by September 2009 energy companies must ensure that people with pre-payment meters are not charged more that those on a standard tariff. By increasing the standard tariff they will not have to reduce the cost of energy to pre pay customers and any loss in income caused by people switching to cheaper internet tariffs will be offset by those who are unable to access the internet and must remain of the standard tariff.

ancientaviatior 02 Sep 2008, 1:01pm

TMFVertigo, I read you loud and clear. I made the switch, after two days of head scratching, but I recon the saving will only be about £60-£80 pa. I know, better than a poke in the eye with a sharp stick, but not life changing. roderickeaton ‘s comments really struck a chord though, and I think, as the penny starts to drop with the great British public, they will realize that the situation is WORSE than it HAS to be because of inept meddling and twisted ideology of the Muppets (of both parties) who have run this country for the last 60 years. Me, synical……NEVER!

MooBear1 02 Sep 2008, 1:30pm

Just a [short?] point on the invitation to install solar power at home by noony29.

Installing solar power at home is [almost] prohibitively expensive. Did you ever wonder why?

These devices are priced in such way as to enable the manufacturers to reap maximum profit. They cost much much less to produce.

Everyone knows that the margins in some shops are 600% - or as much as the market will take. If they can, they will sell them even dearer...

Where is the forward thinking of the government to mass produce solar panels and sell them at cost to whoever is willing to buy them, go green and save the planet? How is that for a carbon offsetting initiative?

Oh, but the chances of that happening? Ziltch - because it doesn't give power leverage (or even profit) to the senior civil servants (aka Whitehall Mandarins, the people really in charge of the country, or have you not watched "Yes Minister" lately)

Yet another point - who do you think has the know-how to manufacture high quality wind turbines or solar panels? (companies related to the energy sector or charity shops?)

Do you still wonder why commercial installations are so expensive that they are not going to pay for themselves in our lifetime? - Because someone is willing to pay that sort of money...

Now, who came up with those 'green' initiatives and who decides on a 'budget' for carbon offsetting? Our Government or the colombian druglords?

But why are we (60 million people) made to do something about the climate change, when 2.1 billion people (China and India combined) don't even know that what the word 'climate' means? And that before we even count the holy cows, whose flatulence contributes to the CO2 emission greatly...

I just want to know how does the average Chinese person survive on 500 dollars per year, when in UK we can hardly see the week go by with that amount... there is gotta be something fundamentally wrong with the prices in this country and the ways our Lords rule us

YorkshireDave 02 Sep 2008, 1:46pm

JugPenKettle says (s)he is considering using electric immersion heating instead of gas when the old gas boiler gives up the ghost. With gas and oil prices so high now, the premium for electricity is relatively small. This makes the option of a heat pump very attractive in many cases. The initial cost means it is unlikely to be worth replacing your existing boiler while it is still OK but if you do have to replace it, take a look at a heat pump - a good ground source heat pump uses only a quarter of the electricity that an immersion heater does for the same amount of heat!

And while you're looking at solar, make sure you consider solartwin - by far the easiest to install and uses only solar electricity from its built-in pv panel for pumping the water around.

ancientaviatior 02 Sep 2008, 3:33pm

Nice rant moonbear1 and I thought I was a cynic! Oh, just a minor point, but most of the GBP (Great British Public), who are old enough to have watched Yes Minister, still think it was a BBC comedy series. Whereas it was actually a training series for the Civil (Dis)Service

ancientaviatior 02 Sep 2008, 3:42pm

Er, YorkshireDave, correct me if I'm wrong but along with the ground heat pump don't you require about 4 miles of pipe burried 2 meteres below about 4 acres of ground to get it to work?

HouseBug 02 Sep 2008, 4:16pm

Many Canadians and Americans heat their homes with oil fuelled furnaces (forced air heating). The ridiculous cost of oil has sent the alternative industry into overdrive. Heat pumps (which somoeone here mentioned) are becoming very popular as you can see your heating costs drop as much as 50% or more on an oil furnace. My dad, on the other hand, simply switched to a wood burning furnace (yes I know, nice if you live in the wilds of New Brunswick, Canada) and saw his heating costs drop by a full 2/3. Brings back the point I made in my first post about the lack of viable alternatives in the UK. Even if you can get wood or coal at a decent price, you may not be able to use it because of "no burn" legislatin etc... We can't wait to move back to Nova Scotia in the new year! After seven years, I've had quite enough of "Rip Off Britain"

JugPenKettle 02 Sep 2008, 4:18pm

I don't think that the U.K. is on its way to self-destruction. Things aren't fantastic for everyone, but they never are. I am doing o.k. now, I think, because of the increases in the price of fossil fuels. But my petrol bill has gone up a lot as has the electricity and gas. So I am keen to make my own heat and power and hopefully become more independent of other people. Whereas my counterpart in China has to rely on his government getting the fuel supplies they need from a lot of foreign sources. He'll catch on eventually, in the meantime I don't see the point in not making things better for myself.

And if Climate Change stuff does turn out to be a big hoax, or a big mistake, what's the harm? If we didn't do this we would be doing something else instead - those eveel government-types that everyone is worried about would find something else to spend our money on.

Oh, by the way YorkshireDave, I happened upon some heat pump stuff today before I read your note and was coming back to tell everyone about it! The WorcestorBosch stuff looks good, and I have had one of their boilers before, and I like Bosch kit. So I may look into it some more. Thanks.

kentishobserver 02 Sep 2008, 4:29pm

NickTaylor42 must be lucky - his French supplier Soregies is a rarity in France as it is a long standing independent municipal gas and electricity supplier dating back to 1923. Virtually everyone else in France uses Electricite and Gaz de France (EDF-GDF)though other companies can now compete for domestic customers... in fact my understanding is Soregies and a similar organisation in Grenoble are now linked in Alterna to provide direct competition across France to EDF/GDF

hambledon 02 Sep 2008, 5:20pm

So far I have'nt read one comment about the possibility that tha global warming may be a NATURAL process???? After all we once had the ice age,which killed off the Dinasaurs,& now we have global warming. POSSIBLE???? But our Mr BROON sees it as a great opportunity to implement GreenTaxes,to be spent how??where?? ......If things ARE warming up?? then more sun will make solar heating a good bet(this Summer excepting?!?!)

Accountantsmum 02 Sep 2008, 6:15pm

First, to Hambledon and RoderickEaton, the world's scientific community has concluded that it is 90% certain that global warming is due to human activity. These are people who, frankly, know more about it than you or I. I'd like my grandchildren and their grandchildren to have a decent life: so please, let's work to reduce global warming and go with the 90% rather than the 10%. If you were offered a ticket on a train that was very cheap, but you were told expert engineers said it had a 90% chance of bursting into flames and killing everyone on board, would you take it?

Second, I agree altogether with brewerDave: I was talked into switching to a one-year fixed deal with EDF, but found it almost impossible to find E.ON's current prices (my current supplier, but increased since my last bill so the prices there were no longer valid). And this is the problem with comparison sites: prices change so rapidly that it's hard for them to be accurate. One of them once told me npower would be cheaper than my present supplier.. who was npower!
Back in the Bad Old Days you had to pay what British Gas and your local Electicity Board chose to charge. The problem with deregulation is that the energy companies are, well, deregulated.... For me the answer is better insulation, both for the house (I've had the loft done, don't have cavity walls and it's all double glazed) and for me (good excuse to buy a new jumper...), then turn the thermostat down a bit. But maybe the ultimate answer is not to live in chilly Newcastle but to emigrate to Torremolinos where they have sunshine about 350 days a year!

apseudonym 02 Sep 2008, 9:02pm

Hi ancientaviatior
Ground source heat pumps can use pipes spread over quite a large area (but not 4 acres) but they can also use vertical pipes this involves drilling down a couple of hundred meters and laying the pipes in the hole.
I was watching them drill down and install one of these a few weeks ago it is a relatively simple process and although it will cost a few grand it is much more efficient.
The men installing it said that in the last year these have really taken off.
Incidentally there are also water source heat pumps and air source ones if you don't have the ground to bury them in.

ancientaviatior 03 Sep 2008, 7:44am

Thank you apseudonym, I'm off to Google it and find out more!

fenemore 03 Sep 2008, 10:53am

What Accountantsmum fails to mention is that only 10% of climatologists claim that global warming is 90% down to human activity (goto http://www.globalwarming.nottinghamshiretimes.co.uk/index.html).

Even if those 10% are correct, it doesn't alter the fact that if here in the UK we stopped producting CO2 altogether, it would not make a blind bit of difference to the world's climate. Our little island is just but a pimple on this planet. If you read some of the findings on the above website, there is a very logical reason why the world should try and increase its CO2 output, to STOP the world from plunging into another ice-age.

Of course governments ignore these scientists for obvious reasons - they would lose the Holy Grail of all governments - to raise taxes revenues without argument.

Those who buy into all the global warming scaremongering may feel they are safe-guarding their kids future, but I suspect future generations will will look back and wonder at our gullability and utter stupidity.

McLeodC 03 Sep 2008, 6:31pm

The easiest and cheapest way for most householders to reduce their energy bills is by improving the energy efficiency of their home. Most types of insulation are low-cost, and much of the work can be DIY. No-one should consider expensive solar panels or other means of energy generation until they've done everything possible to meet (and preferably exceed) the required insulation levels. Otherwise, you're just paying to heat the atmosphere, regardless of whether you buy-in energy or generate it yourself.

McLeodC 03 Sep 2008, 6:37pm

Please can hambledon, fenemore and the other climate change sceptics find some other site to debate that issue, instead of hijacking the comments board every time there is an article discussing how people might reduce their energy bills?

tastyfish2000 04 Sep 2008, 1:49pm

We're part of the EC, moaning about prices is one of our leading national pastimes but can you find any information easily on the internet about what our European neighbours pay? Nope, is the answer.

Can journalists spend a bit more time looking in-depth at how we Brits really fare compared to other European nations and are we justified in bemoaning high prices instead of filling our papers and airwaves with stories of a presidential campaign thousands of miles away.

PS I thought it was complicated enough in the UK trying to work out our energy bill - just thankful I don't live in France. Seems like you need an engineering and mathematical degree to work out all the diffrent codes and tariffs. Then again, I guess it keeps some French person in a job.

PPS And why is it so difficult to get hold of unit prices for gas and electricity?

PPPS Having finally gotten hold of unit prices for my region and shoved in my own actual and seasonal usage into a giant spreadsheet I can confirm that the most accurate energy price comparison tool on the internet is uswitch.com. It calculated my actual bills to within a few pence. Very impressive! It has the most accurate assumptionsn and takes into accounts discounts, etc.

atseyes 05 Sep 2008, 12:03am

Sorry, McCleodC, but since the Government, at least, tries in part to justify higher energy prices, and overall energy strategy, using climate change, then it is going to feature in any discussion on energy pricing; and although climate change is a natural phenomenon, there seems to be little doubt that it is being made much worse by human activity.
On a slightly different note, a few years ago, the concern was that of our energy supplies running out altogether. I know that none of us wants to pay too much for our gas and electricity, but I do wonder if we haven't been buying rather too cheaply in the past. In other words, the best way to reduce energy bills is to reduce energy consumption, even if it does mean cutting down on the time we spend on our computers!

sbolter 07 Sep 2008, 8:42pm

1 Solid fuel is only cheaper than mains gas if you cut your own firewood.

2 Yes French electricity is cheaper than ours because they use nuclear energy to generate a large proportion of it.
Yes making nuclear generators pay a levy to support renewables is completely unjustified.
How mad we were to sell off our nuclear constructors, just as it was becoming obvious to all that renwables alone would not save us without unacceptably lowering the standard of living, and so to let the Japanese profit from our expertise

4 However renewables do have a role to play, but not in the provision of base load. Putting a levy on fossil fuel generators is justified.

5 On our own, our cutting of CO2 emissions will not solve rapid climate change problems,however we cannot expect others to cut their emissions if we are not prepared to cut ours. We all need to be involved.

ThatMini 10 Oct 2008, 1:11pm

Funnily enough, the best utility provider in the Which? Magazine was Utility Warehouse Discount Club.

Their approach to tariffs is to monitor them every month, and adjust as necessary to ensure they are competitive. It means u never end up paying over the odds, and they also have a pretty unique customer discount available that can actually reduce your bill to zero.

Their phone number is 0800 13 13 000 , and if you quote B61852, you can be helping raise money for The Red Sock prostate cancer charity while you save money.

MrPound 17 Oct 2008, 3:42pm

Does anyone know what happens if you want to switch your energy supplier but are in debit with them? Can the debit get transferred across to the new provider? Do you get charged interest on your debit with energy companies?
I have been with npower for years and have never switched. However they always slightly undercharge me, leading to a bill for around £300 at the end of every 6 month period (which is when they calculate it). This means that unless I pay £300 extra I can't switch. A very dodgy practise if you ask me.

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