MARTIN Lewis’ MoneySavingExpert has revealed how much you’ll pay on your new tariff if your previous energy firm has gone bust.
Skyrocketing gas prices have meant lights out for vulnerable suppliers and at least six providers have collapsed in the last few weeks.
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Post pandemic demand and lack of supply is being blamed for the rise in costs.
That is then passed on to households through rising energy bills as wholesale gas accounts for around half of your energy bill.
But the energy bill price cap which is set by Ofgem, and designed not to over charge customers on their energy, limits just how much suppliers can ask for.
And not being able to make the ends meet, a number of firms have gone bust.
Millions of customers were left in the dark as their own suppliers went bust, but most have now been appointed a new tariff.
To put customers’ minds at ease, the money saving team at Martin Lewis’ MoneySavingExpert has put together a full list of tariffs that customers have been transferred to, with a comparison to what they used to pay too.
The price cap is set to rise by £139 a year, from £1,138 to £1,277 on Friday though, so unfortunately for most it means prices are only going up.
Those previously with Avro Energy will now be with Octopus Energy, paying up to £397 more for the ‘”Flexible Octopus” £1,267 tariff.
Green customers have been moved to Shell Energy’s “Flexible 6” meaning a maximum £467 hike from their old tariff which ranged from £810, to the new £1,277 tariff.
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People’s Energy customers who may have been on a £920 tariff have now joined British Gas’s “The People’s Tariff” paying up to £357 extra for the new £1,277 a year bill.
Meanwhile customers with PFP Energy have moved over to the £1,277 British Gas “Price Promise Apr 2022” tariff which is a £447 hike from the minimum tariff they may have been paying at £830.
Plus, Utility Point customers have been moved to EDF Energy “Welcome” at £1,277 a year, upping their bills by as much as £447.
For some the new tariffs work out just fine and may even be better than the previous suppliers’ offers though, but with the price cap rise there’s little many households can do to avoid the hikes.
You can use tools like the MoneySavingExpert Cheap Energy Club to find out exactly how much more you’ll be paying – just pop in your old tariff and the new supplier you’ve been dealt to get a better picture.
What happens if my energy provider goes bust?
If your supplier folds, your energy won’t be cut off, so there’s no need to panic.
Ofgem will arrange an interim supplier so you won’t have to go without.
Guy Anker, deputy editor of MoneySavingExpert, said: “For any firm going bust – the actions are simple. Do nothing, don’t panic and you’ll be transferred to another supplier.
“You will probably lose the cheap deal you’re on, but only once you know the supplier will you be able to assess the cost.
“You won’t lose your supply and your credit will be protected.”
Customers affected will be contacted by the new supplier, which will be chosen by Ofgem.
Many affected by the recent collapses will already know their new tariff now.
After the fall of People’s Energy, for example, Ofgem appointed British Gas to take on supplying the provider’s 350,000 customers.
But you should keep in mind that the new firm won’t have to honour the deal you were on with your previous provider, although any credit on your account will be protected and you won’t lose what you had.
Charities also recommend keeping old energy bills and waiting until your new supplier is appointed before cancelling any direct debits too.
Should I be looking to switch?
Being lumped with a new tariff that you didn’t chose in the first place may be frustrating for some, and it’s true that you are under no obligation to stay with what Ofgem gives you.
But even Martin Lewis himself explained how there is simply nothing on the market that’s cheaper right now.
Recently comparison giant Compare the Market even had to remove its switching service tool as it felt it couldn’t provide customers with enough quality choice tariffs to decide between.
In Martin and the teams’s latest newsletter he explained how the new price cap is now the cheapest and “cheaper than the cost price of energy.”
He said in the tips email: “There are no switchable deals meaningfully lower.”
That’s not to say you can’t shop around, but only do it once you’ve been appointed your new provider – there won’t be any exit fees to deal with so you can freely leave without penalty if you do find something better.
It’s also not been ruled out that the price cap will rise substantially in six months’ time when it’s next reviewed, so make sure to check if you can save by switching before then.
Martin Lewis explains why you need to take a screenshot of your energy bill NOW
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