Energy bills are going up, but you can still cut them

GB Energy customers will be transferred to another company

Energy bills are going up, but you can still cut them

Rising energy costs have forced one small supplier to shut up shop – and it may not be long before you and your home feel the pinch too.

GB Energy was one of the challenger energy companies, offering lower fixed energy prices than the "Big Six". Its 160,000 customers will be transferred to a different energy company.

See also: Top tips from Martin Lewis on how to save money on bills

See also: Thousands face risk of higher bills after energy supplier folds

Increased costs for homes

Many energy companies are passing these higher wholesale costs on to customers by pushing up annual gas and electricity bills. Money Saving Expert calculations suggest there's been an average hike of £100 a year since May, and the prices keep going up.

Most at risk are people on standard variable tariffs. These prices are usually the most expensive in the first place, and they can change at any time. Worryingly, Ofgem figures show close to seven in 10 households are on this type of tariff.

The best way to ensure you don't get caught out by price increases is to fix your energy deal, with possible savings of up to £300 a year.

How an energy fix works

When you move to a fixed-energy deal, the amount you pay for your energy can't go up and down. It's a set amount. Each fix is usually for a limited period, often a year. You can sometimes fix for longer though the cost of each energy unit will likely be higher.

This helps you have an idea of what you're going to spend on your energy bills, and avoid any unexpected hikes.

However, when the fix ends, you need to fix again or you'll revert to the pricey variable rate. It's also really important to realise the size of your bill depends on how much energy you use.

You can fix with your current supplier, by asking to be put on its cheapest fixed tariff. But to save even more money, you should see if you can switch and fix.

What happens when you switch

Switching is very easy to do, and the new supplier should take over in less than 17 days.

When you switch, nothing really changes except who you pay and the customer service you receive. The actual gas in the pipes and electricity in the wires will be exactly the same. You also don't lose any power while the switch is going on.

You can switch if you are on a prepayment meter, and might even be able to switch from one of these to a standard meter.

How to find the cheapest energy deal

The best way to see if you can save by switching and fixing is to use a comparison site. Enter in a few details that can be found on your bills and you'll be shown just how much you can save.

Once you've chosen your new deal you simply enter your bank details and wait for the switch to happen.

This article is provided by the Money Advice Service.



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