Switch to direct debit for lower electricity prices
Ofgem has reminded consumers that paying their energy bill by direct debit will lead to lower Electricity prices in the longer term. It issued the reminder following news that many households have abandoned this payment method.
It is thought that 40% of consumers in the UK originally took the option to pay for their electricity via direct debit to help reduce the cost. People who pay their bill by direct debit are able to take advantage of cheaper online deals - in fact, a household on a Standard Plan who pay by direct debit could make an annual saving of £214 over one that pays by cash or cheque.
Despite this, an estimated 4% of consumers cancelled their direct debit payments over the last year. It is thought that this may have been in response to the recent energy price increases.
In order to cover the price increases, energy providers have had to raise direct debits by an average of £22 per month: many consumers have reacted to this substantial rise by simply cancelling the direct debit.
For those who are concerned about the price increases, Ofgem recommends contacting your energy supplier to see if the monthly charge can be lowered, shopping around for better electricity prices from different suppliers, and cutting down on the amount of electricity you use.
Consumers should be aware that the best electricity deals are always available through direct debit. Many people have actually switched to prepayment meters in the belief that by paying up front they will be able to monitor their electricity usage better - however, prepayment meters should be avoided, as they charge the highest rates.
Electricity prices: www.uswitch.com/gas-electricity/compare-electricity-prices/
It is thought that 40% of consumers in the UK originally took the option to pay for their electricity via direct debit to help reduce the cost. People who pay their bill by direct debit are able to take advantage of cheaper online deals - in fact, a household on a Standard Plan who pay by direct debit could make an annual saving of £214 over one that pays by cash or cheque.
Despite this, an estimated 4% of consumers cancelled their direct debit payments over the last year. It is thought that this may have been in response to the recent energy price increases.
In order to cover the price increases, energy providers have had to raise direct debits by an average of £22 per month: many consumers have reacted to this substantial rise by simply cancelling the direct debit.
For those who are concerned about the price increases, Ofgem recommends contacting your energy supplier to see if the monthly charge can be lowered, shopping around for better electricity prices from different suppliers, and cutting down on the amount of electricity you use.
Consumers should be aware that the best electricity deals are always available through direct debit. Many people have actually switched to prepayment meters in the belief that by paying up front they will be able to monitor their electricity usage better - however, prepayment meters should be avoided, as they charge the highest rates.
Electricity prices: www.uswitch.com/gas-electricity/compare-electricity-prices/
