Why have my energy bills just got more expensive?
Were you accustomed to paying a certain amount for your energy only to find yourself hit by a sudden shock bill that’s left you cutting back expenses elsewhere? Before you go on a household witch hunt for the appliance or husband that’s gobbling up excessive kilowatt hours, consider another culprit: the weather and your thermostat. Your boiler was likely idling for months during our blistering summer but now that the temperatures have plunged, it’s pumping again, and you’ll see the impact on your energy bills.
Keeping our spaces warm and cozy during the cold winter months accounts for two thirds of energy use in the UK and half of our annual energy bills. You may have been running fans all summer but they can’t compete with your boiler or your storage heaters. Electric fans have a wattage of between 25 and 75. That means running them for a single hour uses between 0.25 and 0.75 kWh of electricity, costing you between .4p and 1.2p. Even continuously running a 50 watt fan for 90 days between June and August would only use 1,080 kWh of electricity. In contrast, Britons use an average of 12,037 kWH of energy each year to heat their homes, whether gas or electricity, and can easily pay in excess of £1,000 a year for that energy.
If you’ve set up a direct debit with your energy supplier, they will generally average your energy use over the year, giving you fixed monthly bills. This means you’ll be overpaying in the summer and will be in credit as you approach the winter and its higher energy consumption, and will then underpay all winter, until summer and its lower energy demand comes around again to balance the books.
But even with fixed direct debits, your costs can be re-evaluated in the winter, if meter readings reveal that you’re using more energy than expected and you didn’t accumulate enough credit over the summer (maybe because you were running fifteen fans so consistently).
Suppliers can also hike their prices throughout the year, in response to increasing wholesale energy and other costs. Nearly every major supplier has elevated its prices this year and some have done so twice. Even if you’re in a fixed tariff, you can exit without penalty if your prices have been raised within the previous 30 days. A price increase is a great time to reassess your tariff and shop around to find the cheapest energy deals.
Price increases per unit of energy can hit every time of year, but increases in your bills due to consumption generally come right at the outset or after cold weather.
Below we’ll take a closer look at the ways Britons pay for their energy and why, under each type, your bills may have increased as the temperatures dropped and your boiler switched on.
Energy suppliers will give you a discount on your energy bills for setting up a direct debit. Ensuring the charge goes directly from your bank account to your supplier also spares you the hassle of remembering to pay your bills. There are a number of types of direct debit energy tariffs on the market and the cold weather will impact your bills differently depending on the type you have.
- fixed or equal monthly direct debit: With these tariffs your supplier estimates the amount of energy you’ll use over the upcoming year and divides it by 12 and then charges you that amount each month. However, they’ll still take, or request, meter readings from you, generally twice a year, and can reassess the level of your direct debit if they find you’ve used more energy than anticipated. This often happens in the spring, after a long, chilly winter, but you might face a hike of your direct debits at the outset of winter if meter readings show you aren’t in as much credit approaching winter as you should be.
- variable monthly direct debit: If you don’t like the idea of paying for estimated use or overpaying for energy in the summer, you can opt for a variable monthly direct debit and pay for only what you use each month. Again, the cost will be directly deducted from your bank account. But while you won’t have to physically pay the bill, you’ll have to remember to supply meter readings every month and to budget ahead for the winter, after a low-cost summer.
- quarterly direct debit: With a quarterly direct debit, you’ll be billed for energy used over the previous three months. Expect to see a higher bill following the winter months.
- seasonal direct debit: Some energy companies automatically adjust the amount monthly direct debits to reflect different energy demand in winter and summer. For example, renewable supplier So Energy forecasts your annual energy consumption for the year, divides it by 12, and then adjusts it for the time of year, increasing by bills by 25% in the winter (October to March) and lowering them 25% in the summer (April to September). As you move from the discounted winter months to the winter surcharge in October, you might find your bills much higher than the month before.
Pay on receipt of bill
Some households still pay energy bills the old-fashioned way, following the receipt of a bill every three months. You’ll see a steeper bill for the three month period over the winter and should make sure you have enough money to pay it in the spring.
If you’re using a pay as you go gas and electricity tariff, you might find you have to top up your meter more frequently during the winter, as your boiler or electric heaters run. Make sure you’ve set aside enough money to be able to heat your home to a comfortable and safe level throughout the winter. Citizens Advice found the 140,000 households on PAYG energy tariffs went without gas or electricity in 2017 because they couldn’t afford to top up their meters, with more than half (56%) going without heat. If you’re struggling with your energy bills and unable to heat your home, contact your energy supplier. You may be able to get temporary credit to top up your meter enough to get you through the cold snap and then negotiate a way of paying off your balance when the weather warms and you can more safely curb your usage.
The reason your bills may have increased recently depends on the way you’re charged for your
when you might face other bills, including for warm clothing and
It depends on the way you are charged for your energy usage.