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Understanding why your gas and electricity bills are unexpectedly high

With energy being a significant expense for many households, it can be difficult to adjust if you face a sudden increase in your electricity and gas bills. Fortunately, there could be a simple explanation for your unexpectedly high energy bills. Some of the most common reasons you might face a high energy bill are explained below.

You’re on an expensive tariff

One of the most common reasons why domestic customers face high energy bills is because they have been placed on their supplier’s standard, more expensive tariff – often without their knowledge. However, it is common practice for suppliers to move customers to their standard tariff once a fixed price tariff has expired. You might be on a standard tariff if:

  • You haven’t switched energy suppliers since moving into your current home: energy suppliers automatically place new occupants on their standard, most expensive tariff. If you neglected to sign up to a tariff when you moved in, you could save money by switching as soon as possible.
  • You haven’t switched suppliers in the past twelve to eighteen months: typical household tariffs run for twelve to eighteen months, after which you are placed on the supplier’s standard tariff. To prevent this from happening, it is important to find and arrange a switch to a new tariff at least a month before your current tariff is about to expire. 
  • Your fixed rate tariff has ended: fixed rate tariffs are useful for freezing the price you pay for each unit of energy you use, but these are often twelve to eighteen months in length. If you’ve suddenly noticed an increase in your bill, your tariff may have ended and you may have been placed on your supplier’s standard tariff. Your supplier should contact you before your tariff comes to an end, giving you enough time to switch to a new tariff.
  • Your bill has the word ‘standard’ in its title: household energy bills usually contain the name of the tariff in its title. If you haven’t signed up to a tariff, you’ll be placed on your supplier’s expensive standard tariff, and will be billed as such. 

Your discounts have ended 

If you were able to take advantage of introductory discounts when you first signed up to your tariff, a higher energy bill could signal that these discounts may have ended or expired. You could switch to a cheaper deal at this point if you wish, although you may face cancellation fees if you attempt to do so before your tariff is due to expire.

You’ve moved from estimated billing to accurate billing

All households receive one of two types of bill for their energy consumption – estimated or accurate. An estimated bill means your supplier has estimated how much gas and electricity you’ve used, which is done by taking into account a typical energy user’s consumption as well as your previous years’ consumption. An accurate bill means you’ve provided your supplier with meter readings on a regular basis, so they are able to charge you for the exact amount of energy you’ve used. Your bill will usually specify whether meter readings have been estimated or are accurate.

Typically, what tends to happen with an estimated bill is that your supplier either overestimates or underestimates your usage. If you’ve recently moved from estimated to accurate billing, your supplier is now using your actual usage figures to calculate your bill. If you tend to use a lot of energy and your supplier was previously undercharging you, your new, correct bill may seem high in comparison. Your supplier may also have sent you a catch-up bill to make up for undercharging you in the past. Of course, the opposite scenario is also possible – you may have been overcharged and are now paying less with accurate billing than you were with estimated billing, meaning you may be due a refund from your supplier.

You’ve used more energy than usual

Once you’ve determined that the meter reading on your bill is correctly aligned with your consumption, you’ll need to consider other aspects about your usage to figure out why your bill has increased. Think about whether anything has changed in your home since your last bill that might mean you’re using more energy than usual. This could include factors such as:

  • Weather becoming colder or warmer: increased use of heaters in the winter and air conditioners in the summer can affect your energy bill.
  • Spending more time at home: you might experience an increase in the amount of energy consumed at your home if, for example, your children are home due to school holidays or if you’ve just started working from home.
  • Having more people at your home: an example of this could be that you’ve recently had friends or relatives staying at your home.
  • Using or buying more appliances: using additional appliances will inevitably require more energy, and this increased usage will be reflected in your bill.

Your home isn’t energy efficient

You might be unintentionally using more energy than necessary if your home is not energy efficient. This means any heating or cooling systems you’re using will be working harder than typically required in order to account for the fact that air is being lost through your walls, windows and doors. The table below outlines the average energy consumption for various-sized houses:

Average energy consumption

If you’re using more energy than normal for your house, you might look into implementing energy efficiency measures at your home. Some of these measures could include:

  • Improving insulation with cavity wall insulation and loft insulation.
  • Improving insulation with double glazing.
  • Servicing your boiler regularly.
  • Installing draft excluders at all doors and windows, including your letterbox.
  • Turning thermostats down at least one degree lower than usual.
  • Turning heating down or off in rooms you don’t use often.
  • Using energy efficient light bulbs throughout your home.
  • Turning off lights when not in use.
  • Turning off and unplugging appliances when not in use, instead of leaving them on standby.
  • Using energy efficient settings on appliances such as washing machines and dishwashers.

Your meter isn't working correctly

Although it’s a rare problem, some households may find their energy bills are inaccurate because of a faulty meter generating inaccurate readings. 

If you think there may be a fault, keep a log of meter readings every day for a week. If there is a noticeable difference in your readings despite using a similar amount of energy, it might be a good idea to contact your supplier about the fault. Alternatively, you might check your usage over the last three months to see how it’s changed. If your readings are significantly different and you haven’t had any changes in your usage, you might consider contacting your supplier.

You might also be able to check whether your electricity meter is faulty by turning off all the circuits in your fuse box and monitoring your readings. If your meter is still going up when your mains electricity is turned off, there might be a fault. If you wish, you can get an electrician to check your meter for you before contacting your supplier. Your supplier may send someone to check your meter and carry out some tests, although if it is found that your meter is working correctly you may be charged for the visit.

Faulty appliances

While domestic appliances such as dishwashers, washing machines and tumble dryers – also known as white goods – can use a lot of energy, if your energy consumption hasn’t changed, you shouldn’t be faced with any sudden increases in your bills. If you’ve found that your electricity bill is higher than it should be, there might be an electrical fault in one of these machines. Faulty white goods are potentially dangerous and can cause fires or become electrically-charged. If you suspect that your appliance is faulty or defective, do not use it until it has been repaired or replaced by a qualified electrician. Your bills should go back to normal once this has been resolved.

You might also face an increase in your electricity bills due to faulty electrical wiring. When electrical wires become loose and frayed they may connect with other wires or conductive objects. In doing so, they can heat up and consume electricity. It is important to get this checked as soon as possible as this excessive heat can lead to a fire or a potentially fatal electric shock.

Your supplier raised prices

Your energy bill might have gone up simply because your supplier has increased their prices. This is usually the case if you’re on a variable tariff where the price you pay for each unit of energy fluctuates with market prices. However, if your supplier does intend to raise prices, they must give you at least 30 days’ notice, either by sending you a letter or an email. Once you’ve received this notice, you can switch to a different tariff or supplier if you wish to.

Your supplier made a mistake on your bill

It is important to check your bill carefully to make sure it’s correct. Suppliers can make mistakes on your bill, which can include:

  • Using inaccurate meter readings.
  • Billing you for the wrong property or meter – your meter reference numbers are unique to your property.
  • Billing you for the wrong kind of meter – check whether your meter is imperial (four digits) or metric (five digits) and that this matches up with the figures on your bill.

If you do spot a mistake, you should be able to contact your supplier to point out the mistake and be sent a new bill. 

Other reasons why you might have a high energy bill

At times you might find that your energy bill is slightly higher than normal. While a significant rise in your bills can be worrying, the following circumstances should only see a slight increase in your energy bill:

  • There were more days in this billing period: sometimes the number of days in a billing period differs between bills. If this is the case, you should only notice a small variation in your energy bill.
  • You had money outstanding from a previous bill: if you hadn’t paid your last bill in full, your current bill may include the remaining money you owe.
  • Energy prices have risen: if you’re on a variable tariff, you could experience slight variations in the cost of your energy.
  • Green policies: suppliers tend to buy their energy in advance on a wholesale basis. In order to sell this energy to customers, they take into account the costs of managing and transporting your energy, and incorporate the costs of environmental policies and government taxes. These costs are added to your bill and can vary by supplier.

How to resolve an issue with a high energy bill

The first course of action if you face an unusual bill is to contact your supplier to explain your situation. They should work with you to resolve the problem. Have your recent bill to hand when you contact them as you may need to give dates, reference numbers and meter readings. Make a note of the time and date of your call, as well as who you spoke to, to make it easier to follow up on your complaint later.

If you have trouble sorting out a billing problem with your supplier, you may wish to make an official complaint. At this point, you should make it clear you’re making a complaint so that the representative knows to follow your supplier’s complaints resolution procedure. If your problem is not resolved within eight weeks, you might consider enlisting the help of your local Citizens Advice Bureau, or taking your complaint to the Energy Ombudsman Service.

If, at the end of this, your supplier is not found to be at fault, you will be liable to pay the full bill. It might help to find out whether there is anything wrong with your power supply or appliances to make sure this doesn’t happen again. If you’re unable to pay your bill, you can request help from your supplier who may arrange a repayment plan. It’s also worth switching tariffs to something more affordable – or finding a way of minimising your energy consumption, which is another area where your supplier can offer advice.

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