Switching to cheaper energy could leave you WORSE off!

[Renta Mouth]

Over the last year I’ve switched to cheaper energy suppliers several times but on all three occasions it’s left me paying MORE for my gas and electricity.

The tariffs are setup so there are no standing charges. It’s based on 2-tiers of unit cost. The first X-number of units used is at nearly 280% higher than the rest of the units used over a fixed period – usually 3 months.

Typically gas is charged at 21.605 pence for the first 22 units, then at 7.077pence for a total of three months. You go back to the high rate at the beginning of the next three months.

Each time I switched to a cheaper energy supplier, I had no control WHEN the switch took place. I switched (using moneysupermarket.com) on 24/01/08 when it was announced Gas prices will rise by 40%, the switch didn’t take effect until 01/03/08 – 38 days later.

On 24/01/08 I was due to come out of my higher rate gas tariff because I has used 24 units on 01/03/08, and switched onto the new supplier’s higher-rate tariff for another three months.

It was announced again that energy prices will rise 40% and I made another switch on 01/04/08 but the switch was delayed until 04/06/2008 after I had used 22 units and about to go to the lower-rate tariff.

The energy companies appear to be colluding with each other, and timing when the consumer switches to the new energy supplier as to maximize the amount of units sold at their higher-rates.

Do I have any recourse?

[ATD]

The two tier pricing is very common, most (if not all) energy tariffs have this. Some suppliers specify it as xx kWH per day at the higher rate, other specify it as the first xx kWH per quarter, either way works out the same.

As for the time taken to switch...you have to give your current supplier a minimum of 28 days notice of your intention to leave (albeit this is actually done by the supplier you are moving too). 38 days total doesn't honestly seem that bad.

The way the energy prices are going at present, if you do switch company you would be better switching to the best value fixed rate tariff, you will pay a premium initially, but in the longer term will be better off.