Gas & Electric, Fixed, Variable how doesit actually work?

antispam246

Hi, first time property owner just trying to suss out my options.

When we moved in we immediately maintained the gas and electric with original supplier, basically ensured they had our details and kept it running. I didnt opt to switch, just wanted to keep it going till I had time to check my options and few a few meter readings.

We're currently on EONs standard variable tariff which equates to roughly (estimates) £1200 a year. When I had budgeted prior to moving in I had about £950 low end to over £1200 high budget. We've been in our new house nearly 2 months, we pay DD monthly, submitted meter readings as soon as we moved in and ine further set since then which they have calculated our dual fual first monthly bill on.

The estimated bill on this variable tariff was £120 our actual first full monthly bill? Just over £30..

Now, ive looked a fair bit into how this worka, especially with switching potentially saving etc.. But something that is failed to mention everywhere is the real cost versus the estimated cost, assumi g your metered.

My main query is, whether your on a fixed or variable contract and also metered, if your submitting meter readings monthly, does it really mean anything at all? As far as I can tell all that actually matters is what you are actually charged per usuage, not the estimated fixed or variable cost per year?

Why do all the places I research energy prices, be it comparison or even here at MSE, not highlight this as a key factor? What am I overlooking?

You pay for what you use? Is it simply for those that arent on meters? Even if your not submitting readings, dont they check every so often to ensure your not over or under paying, and then calculate either an additional bill or some form of rebate?

Even with the latest MSE auction for a cheaper energy deal the immediate and overwhelming response seemed to be the lack of detail to the real costs, exactly as above.

Would love some clarification onthis because it seems like an obvious issue with no address. Is there a comparison site which simply shows the cheapest deal based purely on what they charge per usuage? Does a fixed price mean the cost per energy is fixed or simple the estimated cost is fixed? Does it vary?

[Deleted User]

I think I d get off Eons standard variable tariff onto their 1 year fix V12 which is currently top of the table in my area. Cheapest 1 year fixes seem the best bet at the moment ( First Utility excepted ) these are direct debit monthly or quarterly only. Getting your monthly direct debit correct to begin with will be a bit of a guess as you have no usage history

antispam246

sacsquacco wrote: »

I think I d get off Eons standard variable tariff onto their 1 year fix V12 which is currently top of the table in my area. Cheapest 1 year fixes seem the best bet at the moment ( First Utility excepted ) these are direct debit monthly or quarterly only. Getting your monthly direct debit correct to begin with will be a bit of a guess as you have no usage history

Thanks. When you say cheapest is that based on p/kWh?

When a tariff is fixed, what exactly is fixed? Is it p/kWh or the estimated tariff monthly/annually?

If I fixed and my first DD was estimated based on little history couldnt that simply be rectified with either;
1) submitting actual meter readings prior to bill being produced
2) getting a credit or possibly further debit after the bill based on actual usuage?

Pincher

antispam246 wrote: »

You pay for what you use? Is it simply for those that arent on meters?

Everyone has a meter.

antispam246 wrote: »

Does a fixed price mean the cost per energy is fixed or simple the estimated cost is fixed? Does it vary?

I think you are asking is there a Eat As Much As You want buffet tariff. Only in a bedsit with a live in landlord, and not after he sees the first bill after you move in.

dumpallhere

We moved into a new property last year in October. Switched to EDF fixed price tariff (gas & elec.) from suppliers that the developers had contracted the site with about a month or so later (November).

We did not know how much we would consume in a year, so I guess EDF estimated our potential usage in line with market average and said that we would need to pay £100 per month DD for dual fuel. I used to submit meter readings online voluntarily every 3 months to ensure EDF used the actual readings to charge and issue bills. Eight months into the contract, received a letter from EDF stating that since our usage was almost half of what they had initially estimated they will be reducing the DD to £6 per month (from £100) for the remaining 4 months of the year and will be refunding any extra money they had collected based on initial calculations. The DD was changed to £6 before next DD payment date after the letter was received. I was asked to provide final meter readings for the year by October end, which I did, and only yesterday saw a credit from EDF into our bank account.

Usually, fixed price = fixed p/kwh and fixed standing charge. But there can be instances where a supplier can state that there may be a slight variation (up or down) in fixed pricing during contract period and a percentage is specified upfront. I remember this as we had such a tariff from EDF when we were their customer in a different property about 5-6 years ago.

DD estimation is based on the usage figures / spend amount in the 12 preceding months you provide a new supplier, or in its absence, I believe the std. Ofgem figures of 3300kwh elec. and 13500kwh gas.

If you know how much you use over a year, then the estimation is accurate, else you will end up paying more to the supplier than you need to. But even if the latter, your supplier will refund you the money. All the suppliers I have had contract with clearly state that any overpayments will be refunded at the end of a 12 month billing period.

I have applied to switch to E.ON. I provided them with the usage figures for both electricity and gas, and they have calculated £42 per month for DD. My current supplier EDF has estimated £50 per month for the next 12 months! And, this £8 per month is the actual savings that both my calculations tell me and comparison websites estimate (£100 savings).

All you need to be worried about when switching is - will you pay less p/kwh and less standing charge? will you any get other benefits e.g. - discount for duel fuel, paperless billing, no termination fees, cashback, vouchers, card points etc.??

These are the parameters I look at when deciding to switch. Never ended up losing money. If you are up to it and know your kwh figures, calculating / estimating a bill for a year is simple enough.

[Deleted User]

fixed tariffs are the p/khwhr price,thats set in stone for the 12 months, I m not so sure if the daily standing charge is fixed. The direct debit is not fixed and can move up and down once a good idea of your annual usage is worked out. For that they will need plenty of readings, monthly is preferred.UKpower.co.uk is a good comp site to use to check the tariffs. Any switching go through M.S.E. cheap energy club for a possible cashback of approx £30 payable after 3 months. I ve just switched to EONs V10 1 year fix, the V12 is similar. In my area the gas was 3.5p/kwhr, quite a big difference from any standard/variable tariffs

antispam246

Thank you both that was exactly what I was after, makes perfect sense.

Sorry, i think I was subliminally thinking water when refering to metered/unmetered, thats next on my list

Bark01

Only 4 types are tariff are allowed:

Variable evergreen – no cancelation fee, no end date prices can vary at any time but customers must be informed 30 days in advance if change has possibility to increase bills

Fixed tariff – All prices (standing charge/unit rates/discounts) are fixed for length of product. Product must last for 12 months or longer. Cancelation fees can be applied.

Staggered tariff – Same as fixed but has future price changes that are set out at start of tariff – I don’t think there are any of these in the market

Tracker tariff – Price tracks against a public index outside of the suppliers control i.e. RPI or price of oil. Contract has a fixed length of 12 months or more and can have cancelation fees. Again I don’t think there are currently any of these in the market place

No tariffs offer an all in price, the more you use the more you pay.

E.ON_Company_Representative

Hi antispam246,

Congratulations, I know how you feel, when you buy your first new home, there’s allsorts to think about.

When you first call us to get your account set up, we’ll ask questions about the property, the size how many people live there etc.

This will help us estimate how much your Direct Debit should be, the more readings you give us and the longer you’re in the property, the better your estimates will be.

A fixed tariff means your unit prices will be fixed, for either 1 or 2 years depending how long you’ve chosen. Your consumption isn’t fixed, so If we have a price increase, your unit prices will stay the same, but if your consumption changes, so will your payments.

A variable tariff means if our prices went up or down, so will your unit prices.

I would pop your details in to a comparison website to see if you’re on the best tariff.

Giving us actual meter readings regularly will help your Direct Debit be more accurate when we review it.

I hope this helps and good luck in your new home.

Amy:)