Switching Utility Providers

Switching utility providers can be one of the simplest ways of saving money. One of the easiest to switch is your energy supplier. Record rises in gas and electricity bills in 2006 prompted around four million customers to change gas and electricity suppliers, but many more have yet to move to a cheaper provider - are you among them?

• Why should I switch energy provider?
• How easy is it to switch?
• What energy tariffs are available?
• Can I cut my phone bills?
• What about cheaper broadband?

Why should I switch energy provider?

You may be aware your gas and electricity bills are more expensive than they used to be. The typical household gas bill rose by nearly 40% in 2006, while electricity prices rose 27% (Source: Daily Telegraph 18/01/2007). Several observers have suggested that the average household could save up to £200 by switching power supplier.

The trend has begun to hit gas and electricity companies hard. British Gas, Britains largest (and most expensive) gas supplier has lost around 1.5 million customers over the past few years and saw its market share fall below 50% in 2006 according to gas and electricity regulator Ofgem (Source: Utility Week 20/07/2007).

According to Energywatch , the homes with most to gain are those that have stayed with the same supplier since 1998, when the energy market was opened up to competition. Since then, the old regional monopolies have tended to have the highest prices.

Paying too much for your gas or electricity? Find out how much you could save with a new supplier.

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How easy is it to switch?

Tracking down a better deal need not be tricky, and consumers are becoming increasingly adept at switching when money is involved.

It is now easier to switch utility services than ever. A variety of comparison services enable you to compare costs and switch easily from one provider to another. With a multitude of gas and electricity providers all keen for your custom, it is worth seeing if you can benefit from substantial savings by going elsewhere.

The process need only take a few minutes of your time, and transfers usually take less than a month to complete. The only details you need are the name of your current supplier, your postcode and how much you pay at present.

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What energy tariffs are available?

There are thousands of different tariffs available, so it's worth letting a comparison service do the hard work for you.

Switching to dual fuel - where the household buys both gas and electricity from the same supplier - paying by direct debt and opting to be billed online may lead to the biggest savings.

Some fixed-rate utility deals are available to protect from further hikes in gas or electricity prices. But they can have a lock-in period to prevent consumers leaving, so check this out first.

Along with switching supplier, undertaking some energy-saving steps can also cut costs. It said that the most common waste of energy, poor roof insulation, can cost an individual home an extra £170 a year (Source: Ekklesia 03/05/2007).

Saving money on your fuel bills can be simple. See how much you could save with a new supplier.

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Can I cut my phone bills?

You may also make some savings by changing telephone provider. Since carrier pre-selection (CPS) took off in late 2003, enabling people to have their calls routed through an alternative call provider while retaining a BT landline, dozens of companies have entered the market.

Some of the same providers also began to offer wholesale line rental (WLR), meaning that it is now possible to switch your line rental from BT to an alternative company as well. The telecoms companies still have to pay BT a fixed line-rental charge but this can be reduced by passing it directly on to the customer (although it can be recouped more subtly, via the call charges on some tariffs).

The advantage of taking line rental as well as calls from a single provider is the convenience of having a single bill rather than paying BT a separate one for the line each quarter.

You may compare the cost of switching just CPS, and switching both CPS and WLR; and give you the cheapest price from these possibilities.

Compare the cost of making phone calls, choose the best deal and switch. You could make big savings on your phone bill!

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What about cheaper broadband?

Broadband users can also now change providers to take advantage of better deals with minimal disruption, thanks to new rules introduced in on 14 February 2007 by Ofcom , the telecommunications regulator.

In 2006, broadband prices fell by 17%, and now the average price of stand-alone broadband is just £15 (Source: The Times 17/02/2007).

Despite this, three out of four people are paying more for their service than they need to, with some forking out as much as £35 a month. Costs for broadband now vary by up to £300 a year.

Current broadband customers may be reluctant to switch, fuelled by stories of waiting several weeks, or even months, to be connected by a new provider. But 85% of internet users who have switched provider found it easy to do so, according to Ofcom.

The biggest obstacle to switching is the fear of losing an existing e-mail address. There are ways round this, but many customers end up running two accounts in parallel for a couple of months to ensure that they receive e-mails sent to the old address.

Anyone switching broadband suppliers needs to ask their provider for an MAC, a unique number that enables engineers to identify your line and switch your service seamlessly. The code lasts only 30 days, so if you fail to switch within that time you will need another MAC. Switching without an MAC could mean losing your internet connection for as much as two weeks, rather than a few hours.

Anyone who thinks they may be overpaying for their broadband service should look around for a better deal, or at least speak to their existing provider about updating their deal.

Looking for better online access? Check your broadband options now.

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28 September 2007 © Moneyextra.com

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