Switched gas tarrif & a bit confused!

ammonite

Hi all,
I've never done any switching of suppliers or tariffs before so I just need some advice and reassurance.

We are with nPower for gas (direct debit) and electric (pre-pay). I'm happy with the pre Pay and think we get fairly good value for that but not so much for the gas.

I rang up nPower and the annual consumption of gas is approx. 10000KWh.

We are on the standard tarrif and pay 7.628p for the first 4572 units and 2.951p for the remainder.

I had a look on moneysupermarket and tapped in my details. They suggested that the Energy Online January 2014 tariff would be cheaper. The young man at nPower has told me there is a standing rate of 21.5p per day and 3.379p per unit.

Over a year (for 10'000Kwh) I calculate the Standard to be £508 per year ((7.628 x 4572) + (2.951 x 5428)) and the Energy Online to be £416 per year ((21.5 x 365) + (3.379 x 10000)).

We expect our consumption to rise in the next year so worst case scenario at 20'000Kwh.....Standard would be £804 and Energy Online would be £754 (based on the same sort of calculations as above).

Have I calculated that correctly? Having never switched I'm a bit dubious about tying myself into something for 15 months if I'm not 100% sure I've grasped the concept. Young nPower lad was very patient!

Thanks in advance if you got this far. Does that sound like I understand it? Can get out in the next 14 days if there is something dodgy!

Man_Overboard_2

ammonite wrote: »

Hi all,
I've never done any switching of suppliers or tariffs before so I just need some advice and reassurance.

We are with nPower for gas (direct debit) and electric (pre-pay). I'm happy with the pre Pay and think we get fairly good value for that but not so much for the gas.

I rang up nPower and the annual consumption of gas is approx. 10000KWh.

We are on the standard tarrif and pay 7.628p for the first 4572 units and 2.951p for the remainder.

I had a look on moneysupermarket and tapped in my details. They suggested that the Energy Online January 2014 tariff would be cheaper. The young man at nPower has told me there is a standing rate of 21.5p per day and 3.379p per unit.

Over a year (for 10'000Kwh) I calculate the Standard to be £508 per year ((7.628 x 4572) + (2.951 x 5428)) and the Energy Online to be £416 per year ((21.5 x 365) + (3.379 x 10000)).

We expect our consumption to rise in the next year so worst case scenario at 20'000Kwh.....Standard would be £804 and Energy Online would be £754 (based on the same sort of calculations as above).

Have I calculated that correctly? Having never switched I'm a bit dubious about tying myself into something for 15 months if I'm not 100% sure I've grasped the concept. Young nPower lad was very patient!

Thanks in advance if you got this far. Does that sound like I understand it? Can get out in the next 14 days if there is something dodgy!

I haven't checked your arithmetic, because you are clearly capable of doing your own sums!

The shift from a two-tier tariff to a daily standing charge is supposed to make things easier to understand.

But, let's face it, it is not the format of the tariff which is important, it is the inability of large numbers of people to do simple arithmetic.

Changing the format of the tariff will make absolutely no difference at all to the general level of confusion within the population. It might even make it worse.

ammonite

The level of confusion I displayed on the phone to young nPower man was luckily met with a wave of patience from him but as I say I'm not fully sure I grasped it. It does seem cheaper overall on the new tarrif even if we end up using more gas so I guess i'm answering my own question!

notbritishgas

Like man overboard I have not checked your maths but the formulas you used are correct.

You are on the most expensive tariff, ie standard, so any change should give you some savings. I have checked energyhelpline for my area using standard as my tariff and that also gives npower energy online Jan 2014 as the cheapest.

One point to note is that EO Jan 2014 is not a fixed tariff but merely gives you a discount off the standard tariff until 2014 so if that rises so will your tariff, they do a fixed tariff but the savings are still there but reduced.

molerat

Just to confuse you a bit more have you looked at fixed / capped tariffs. GoFix Jan 2014 is 8% dearer than Online Jan 2014 but will have no increase until then whereas you are going to get the next price increase which is in the wings waiting to happen.

edit: notbritishgas posted whilst I was thinking about it ;-)

jalexa

ammonite wrote: »

We are with nPower for gas (direct debit) ...

Well done for trying to make sense of the calculation. However if you learn to use a comparison website (or three until you gain confidence with one) the calculation will be done for you and more.

Unlike the comparison sites your manual calculation does not take into account any discount structures. Commonly NPower tariffs feature "deferred discount":eek: where the discount is forfeited if you do not complete 12 months periods of supply on direct debit. Not sure if your (and proposed) NPower tariff features "deferred discount":eek:. Best check.

ammonite

Oohhhh its all sooooo confusing! I'm usually very switched on with moneysaving but don't understand the way gas bills work enough to figure it out in my tiny mind

notbritishgas - thanks for explaining about what will happen if the rates rise. I wasn't aware of that. I did think it was fixed until Jan 2014 - the name suggests that but apparently not!

molerat - as above, I thought it was fixed! Right I've got ten days to figure out what gas bills are all about before my cooling off period ends!

Is it a good time to fix now? How can I find the best fixed prices?

jalexa - thanks, again have no idea about deferred discount but shall look into it on the tarrif

Sorry to sound like a right dork with this, the whole thing baffles me

ammonite

Just done a bit more reading and understand now!! I think

So if Energy Online is currently costing me £384 per year and GoFix is costing me £423...... if the energy prices go up as per the article from Martin (9% announced by 2 companies):
http://www.moneysavingexpert.com/utilities/you-switch-gas-electricity

I'd end up paying approx £418 for Energy Online.....assuming they only hike the price once in the next ~15 months which means although more expensive right now it would be cheaper to get the Go Fix over the next 15 months?

How often do energy companies raise their prices?

ammonite

Just bumping this for advice on the last post if anyone has any? thanks in advance