Our Affordable Warmth service re-unites one individual with £3,000
Author: Matt Neal Date: 28/01/2015
Through our recent work, we've discovered that - unsurprisingly - there's a lot of misunderstanding, mistrust and misspending by residents with regard to energy suppliers.
Many horror stories are heard in the media of households being cut off mid-switch, or paying two companies at the same time. Switching can be seen as a daunting task, and can be complicated if debt is involved. Realistically, the costs generally outweigh the risks and, in many cases, it’s in householders' best interests to make a change. The average savings from switching supplier is around £150 per year – and very frequently more depending on the individual’s circumstances. Arguably, energy suppliers don’t honour loyalty like they should, so residents who have been with the same supplier for 10, 20, or even 30 years are likely not to be getting the best rate. Not coincidentally, those who are least likely to be ‘switchers’ are those most likely to make the largest savings.
There is also the added factor that rates change so often that even if a resident switches today, they might not be getting the best rate tomorrow. Again, it's better to switch than to wait around watching rates rise and fall as the resident will still pay less than prior to switching. It's a common and well-advised recommendation to switch energy supplier every couple of years. The central advice is: if your tariff is coming to an end, look into what else is out there. Be prepared to negotiate with your present company, if needs be, and to walk away if they’re not offering you what you’d like and can do better elsewhere.
Our Affordable Warmth team is knowledgeable and experienced in helping residents switch and understand their bills, and can make it much easier for them, providing assistance every step of the way. We do this every day – speaking with residents across all levels of vulnerability and facilitating opportunities for them to save money.
Here’s an amazing example.
Recently, our Affordable Warmth Team was hosting a drop-in session where residents could come to get advice on how to understand their energy bills, or get help with switching their energy supplier – which could be done on site. This is normally done using a price comparison website that allows residents to input information on how much they're currently spending on gas and electricity. The site then displays the full range of tariffs available to them – including costs. It’s by using this approach that the majority of UK customers save their princely sums – putting precious pennies back in pockets.
One gentleman that attended this particular session was paying over £400 per month for his gas and electricity. Obviously, concerned about the amount he was paying and suspecting it was too much for the amount of energy he was using, he sought our help. Our team, with its extensive experience in helping people with switching, was also quite alarmed by the amount being paid. After looking into the gentleman’s tariff, it was discovered that he was overpaying by approximately £250 per month! This was rather concerning, so our team rang the company and attempted to sort out what was going on. It turned out the gentleman was in credit by £3,000!
The energy supplier claims that it had been in contact with the client in question, probably by letter, but he must have been overpaying for about 12 months to rack up £3,000 in credit. The story does have a happy ending, though. Our Affordable Warmth Team was able to cut his monthly bills in half, and he now has £3,000 on its way to his bank account.
The issue here could be attributed to the over-complexity of energy bills and general misunderstanding of them – which is well-known and an ongoing point of grievance for campaigners both within and outside the industry.
However, the story also holds lessons for many consumers to ensure that they keep a tab on their bills and pester their company when they notice something incorrect or discomforting. A short phone call could give peace of mind – and, sometimes, a large financial return.