MARTIN Lewis has shared how a reader slashed their energy bills after taking his advice.
The avid MoneySavingExpert reader has saved £1,000 a year with the trick.
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The reader thanked Martin Lewis for the tip and featured as one of MoneySavingExpert’s “successes of the week” in their latest newsletter.
“Thank you – after your talks with energy firms, I’ve saved over £1,000,” said the reader, Mavis.
Mavis managed to save the cash even after energy bills for the average household rose from £1,971 to £2,500 a year on October 1.
According to MoneySavingExpert, Mavis managed to slash her bills because she benefited from Martin’s campaign to allow fixed customers to move on to the new Energy Price Guarantee penalty-free.
She said: “We locked into a two-year fix at the end of August, which would have cost £3,600 a year.
“After your talks with suppliers, we waited to see what would happen.
“We’ve now been told we will be transferred to the Energy Price Guarantee tariff without any penalty.”
The move to the Energy Price Guarantee has meant that Mavis’ energy bills will now drop to £2,300 a year.
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This means she’s saved £1,300 over the year by switching her costly fixed energy deal to the standard variable tariff which is protected by the Energy Price Guarantee.
What is the Energy Price Guarantee?
The Energy Price Guarantee is a cap on the wholesale price of gas and electricity, which came into force on October 1.
We’ve listed the new gas and electricity rates for those on the standard variable tariff – and they vary depending on how you pay for your bills.
Announced by Liz Truss in September, the cap ensures that an average household pays no more than £2,500 on their energy bills every year.
But the cap only limits the amount firms can charge customers for each unit of energy.
So if you use more energy than the average household – expect to pay more than £2,500 a year.
The Energy Price Guarantee protects those on the standard variable and those on fixed energy deals could end up paying more.
What about those on fixed energy deals?
Government guidance originally recommended that energy suppliers discount the amount customers on expensive fixes pay for their gas and electricity to bring it more in line with the EPG rates.
But a loophole in the new rules meant that those on fixed tariffs could end up paying more than the Energy Price Guarantee cap due to the way the discount would be applied.
This would have still left many on fixed energy tariffs paying more than those on the standard variable tariff and protected by the EPG.
To avoid this, at their own cost, energy firms have now waived the exit fees for those on expensive fixes – allowing selected customers to move onto the cheap standard variable rate.
British Gas, EDF, Octopus Energy, Ovo Energy, E.ON, E.ON Next and Shell Energy have all confirmed that they’ll waive their exit fees for those looking to move contracts.
The new rules mean that customers on expensive fixed deals can simply move on to the cheaper standard variable tariff, which is protected by the Energy Price Guarantee, free of charge.
What should I do if I’m still on an expensive fix?
If you’re still on an expensive fix which charges higher rates for gas and electricity than those offered under the Energy Price Guarantee, contact your energy supplier.
Most suppliers have said that they’ll proactively contact those on expensive fixed deals that would benefit from a switch to the standard variable tariff.
But if you haven’t heard from your energy company and have slipped through the net – give them a ring.
What energy bill help is coming?
Households will have started to receive a £400 energy bill discount from October 1.
In November, a £300 one-off “Pensioner Cost of Living Payment” will be paid out to eight million households.
It will be given to those who already get the winter fuel payment – which is worth between £100 and £300 for those over state pension age.
And from November 8, vulnerable households across the UK will receive a £324 cost of living cash boost.
The government says it aims to make all payments by November 23.
The second payment will automatically be paid into the bank accounts of those eligible.
Millions of households are in line to get the £150 Warm Home Discount between December and March 2023.
