I don't believe there is really £000's to save on energy bills!

stanley25

I'm really interested to see if anyone else has had a similar experience. I have tried several 'comparison' websites and also some of the individual energy company quote functions, and they all claim after putting in my actual energy usage in kwh that I am likely to save X amount of hundreds of £'s compared with my current bill.

Well, the whole idea of "TCRs" (tariff comparison rates) now seems to me to be farcical. Understanding that a 'TCR' is calculated in part by usage a national average energy consumption, I made my own quick and basic spreadsheet to enter in the actual standing charges, and unit costs that various tariffs charge - and guess what... The actual saving for 3 or 4 different tariffs (including a tariff from Eon which was offered up as part of a big community switch) which looked on the face of it to offer big savings all only offered me a real saving of between £28-£35 over a year (that's the saving for elec and gas combined).

Unless I am missing something, TCR seems like a useless and often misleading way to compare your likely bill. I can't understand how if you know your actual usage in kwh, why all of these companies can't use their actual rates (and not the TCR) to calculate your annual bill.

Granted, switching is relatively painless (well, except it wasn't when I last switched) but I have reached the conclusion that most of the companies out there are simply tweaking the ratio between standing charges and unit charges to give you pretty much the same overall bill wherever you go.

What am I missing?

macman

The difference occurs when you compare new tariff to old, versus new tariff to Standard. Many of the sites ask you when your current tariff will expire and then calculate x months on Standard.
What you paid in the previous 12 months is not really relevant: what matters is what is the best deal you can get for the next 12m, and all the comp sites tell you that with a great deal more ease than doing a manual calculation of unit rates, standing charges, DD discounts, dual fuel discounts, VAT etc.

stanley25

OK I think I understand what you're saying. I'm trying to adjust my thinking, but if the important thing is looking for the best deal in the next 12 months then the only comparison worth doing is one that compares your usage against other available new tariffs? So websites that ask for your current tariff and only compare against that aren't a good comparison are they?

matelodave

As has been said many times on this forum the comparison site point you in the right direction - you have to do a bit of thinking yourself to see if the tariffs actually suit you.


The rules laid down by Ofgem for the comparison sites seem to be there to deliberately confuse.


TCRs are OK if you are an average user but don't necessarily work for those who are either above or below average - that's where you have to do your own sums to see if a higher standing charge and lower unit rate is more beneficial than the lower S/C and higher rate.


I could easily spend another £500 a year if I chose the wrong tariff

JJ_Egan

Comparison site pull up the cheapest for you then look at the actual daily standing charge and per unit kwh charge .

Shrimply

In general though, it really doesn't matter, as long as you take into account exit penalties, if you plug your usage details into a price comparison site. Ignore the savings listed and just select the one at the top, that's probably good enough to make sure the majority of people aren't paying over the odds.

Using a spreadsheet yourself is fine, but won't always take into account direct debit discounts and things, which can result in making a tariff cheaper than another if your usage is low.

Smiley_Dan

The only way to save big is to use less energy. Shame DECC seems uninterested.

macman

stanley25 wrote: »

OK I think I understand what you're saying. I'm trying to adjust my thinking, but if the important thing is looking for the best deal in the next 12 months then the only comparison worth doing is one that compares your usage against other available new tariffs? So websites that ask for your current tariff and only compare against that aren't a good comparison are they?

All comp sites offer you a valid comparison of what you can get for the next 12 months. That is the only info you want, as what you paid for the last 12 months may be less, or it may be more. But that is now of historical interest only: 'savings' are irrelevant in this sense. The only figure that matters is the total cost over the next 12 months.
Comp sites weight you against reversion to Standard tariff because that will of course generally show a bigger 'saving', but the total cost figure is still a valid one.

faineant

Comparison sites are just salesmen on commission. They tell you just enough to get you interested in a sale, embellish the upsides and avoid revealing the downsides. Like a salesman they will make you believe they are doing you a favour but too often it is their commission they really want to secure. Sadly, the industry just goes along with them and provides the tools such as TCR to continue sucking the money that in the end comes from the consumer anyway.

macman

Then just use them as a tool to get the prices. I've then always switched via a cashback site once I have found the right tariff, except for my last switch where I used EHL to access a collective tariff offer. That way, you keep the commission.

brewerdave

As per macman - you have to use the "system" to maximise your personal benefit . I've been switching for ~15 years now - a "back of the fag packet" calculation indicates that I've "saved" something like £3k over the years vs continuing to pay my local supplier's "standard" tariffs.:T I can only remember one period of time when my switch didn't pay off as the fix was higher than the standard tariffs for nearly a year.

This next 12 months I'll "save"£400+ ... unless the market retreats even further.