The price of energy is back in the news is it?
It hasn’t gone away. On Tuesday the executive director of Electric Ireland appeared before a Joint Oireachtas Committee and outlined some of the difficulties the operator’s customers were facing. He said that around 125,000 people were behind in paying their energy bills as prices have soared. And he suggested the worse might be to come with wholesale electricity prices set to climb even further. He said Electric Ireland’s wholesale costs would be around €2 billion compared with €300m in 2020.
Does that mean I might end up paying even more than I am already?
It is too early to say, not least because the last round of price increases are only now coming into effect. Price hikes of between 20 per cent and close to 50 per cent are being implemented this week which will see many households worse off by more than €500 over the course of the next 12 months. And of course those increases are coming on the back of multiple earlier increases that have seen average domestic energy bills climb by over €2,000 since 2020.
At least the energy credits announced in the budget will help?
They will, but only marginally. Details of when the payments will be applied to bills have become slightly clearer this week. There will be a €200 credit applied to bills starting in November followed by two further credits of €200 early in the new year.
What about switching? Is there still value to be found there?
Yes, but not perhaps as much as there once was and only if you have not changed provider within the last 12 months. Even six months ago, companies were offering new customers discounts of up to 40 per cent but incentives of that scale are largely off the table now and many of the current discounts are close to 10 or 15 per cent.
Where have all the good deals gone?
Well, as Electric Ireland made clear at the Oireachtas hearing, the companies are feeling the pinch and many are struggling with dramatic increases on wholesale markets — just as their customers are struggling to cope with the increases on the domestic front — and can no longer afford to offer substantial discounts to new customers.
So, is it still worth it to switch?
If you can knock 10 or 15 per cent off a €4,000 bill you can still save between €400 and €600 on your energy costs over the next 12 months so the answer to that question would have to be yes.
So what do I need to do to make the switch?
Well, your first port of call should be your existing provider. Call them and say you are going to move to a different provider unless they offer you a discount comparable to what they might offer you if you were a new customer. If they offer you nothing for your loyalty, it is time to move.
Where do I go?
You could check out switcher.ie or bonkers.ie. Both price comparison and switching websites are regulated and will give you sense of what is on offer. Switching using either of the websites is also an option and can save you having to make calls to individual providers. You simply fill in some forms on the website and they do the rest.
Do I run the risk of being disconnected when making the switch?
No. Many people think that they might suffer an interruption of supply when moving from one company to another but — unlike say the broadband of telecoms market — that simply cannot happen when changing energy provider.
What information will I need if I switch?
Note the MPRN (meter point registration number) on your electricity bill or your GPRN (gas point registration number) on your gas bill and your billing details. Take a meter reading. This is the measure your new supplier will start billing you from. Your old supplier will use it to close your account. Call the company you are currently with and tell them you’re leaving and then call your new company and tell them you want to sign up. And that should be that.
Is there anything else I should watch out for?
You should also ensure you’re not still in contract, otherwise you could be charged an early exit fee. You should also ensure any arrears on your account have been cleared as this could hinder the switch.
What about a cash back deal?
A person who uses a lower amount of gas and electricity might benefit from a smaller percentage discount that comes with a cashback offer, while a person with high energy use would benefit more from a higher percentage discount and less or no cash back.
What is the point of switching if all the companies are hiking prices?
Companies offer discounts to new customers. The discounts are not as generous as they might have been in times past but even if you can save 10-20 per cent on the standard unit rate then it is worth switching. If you move from company A which is charging you €2,500 a year for gas, for example, and get a big discount, then you could save as much as €1,000 without any interruption of supply.
But I have already switched this year?
The good news — if that is not too strong a word — is that you will get a discount on the standard rate based on your agreement, but the bad news is that you too will see prices climb dramatically even though you have made the switch.
What if I can’t pay?
Well, the good — if that is not too strong a word — news is that no household will be disconnected for not paying their energy bills during the winter months that run between December 1st and the spring, according to the Commission for the Regulation of Utilities. It has also put in place arrangements including extended debt repayment periods for customers in debt; and lower debt repayment on top-ups for customers with financial hardship prepayment meters.
But prepay meters are bad value for money, right?
They can be for sure but the Commission for Regulation of Utilities (CRU) has said customers on financial hardship meters will be offered the most favourable tariff available from their supplier.
What about smart meters? Should I switch to a smart meter rate?
Think very carefully about that and think about how you use your energy. It has emerged in recent weeks that of the more than one million smart meters that have been installed around the country, less than 50,000 have been fully switched on. What is even worse is the fact that many of the tariffs available to people with smart meters are more expensive than rates offered to customers with regular meters. That means that if you are on a discounted rate already you might lose that discount by moving to a smart meter rate and if you use a lot of energy at peak hours — between 5pm and 7pm mainly you will most likely pay more moving to a smart meter.
That isn’t very smart?
It’s not is it, not if official policy is to encourage people to switch to smart meters. The Commission for the Regulation of Utilities is looking into it to see how and when smart meters can be made better value for money.
