Experts recommend changing fuel tariffs for lower bills

With the price of oil down almost 50 percent last year, many customers of the big six energy providers are not seeing any decrease in their monthly bills. The government is starting to get involved now, and may even start an investigation as many MPs are calling for one to occur. As that may take time, experts do say consumers should change tariffs as there are cheaper alternatives out there. They can realise immediate savings on their energy bills by doing so.

The investigation by Treasury is expected to show the cause of why bills payers are not benefiting, and it will put added pressure on the energy companies to reduce their rates. But this review could take months for results, and even longer for standard tariffs to reflect the new prices.

The ironic thing is that by the government starting an investigation, this alone could help reduce utility bills for households. The big six can feel pressure from the treasury to do so, and do not want a full audit to occur. So this review by treasury may result in lower bills being paid by millions of families, as they want to try to minimise any pressure from the government. However, it will take time.

People do not need to wait for this investigation to commence or be concluded. There are steps households can take right now. There are some tariffs provided by independent fuel suppliers that reflect the lower cost of wholesale energy, and consumers could save over £100 right now by making the change. This suppliers have been aggressively passing the lower wholesale prices to their customers in an effort to pick up market share.

To get these lower rates however, the big six suppliers are usually not the place to turn to. The average fuel bill for them is about £1,265, or about the same as January 2014. This is the case even though wholesale electricity prices are at the same level as 2012. So savings are not being passed on to families.

By shopping around for a better tariff, experts such as Energy UK are saying people could save between £100 and £150. The exact savings will vary by usage and other factors. Some of the cheapest tariffs will usually be available from independent suppliers, such as Co-operative Energy, First Utility, or Extra Energy.

While the wholesale prices can change at any time, right now it is expected that lower tariffs could continue to be rolled out in 2015. This is expected as there is still an abundance of oil on the market, and with slow economic growth, that is not projected to change over the year year.

It is a shame that the lower prices of gas and oil are not being passed on to millions of households. The big six providers, such as British Gas, are just keeping more of the money for themselves. Families do not need to sit back and take this though. As the experts say, shop around for new plans and tariffs. Taking a little time to do this can amount to substantial savings on heating and fuel costs.