Online energy plans and paying by direct debit slashes bills

08 July 2009 / by Rachael Stiles

Signing up to an online energy plan and paying a monthly direct debit is helping households to wage war against expensive energy bills, according to moneysupermarket.com.

Switching to online energy plans from providers' standard tariffs could save British households a collective £2.3billion a year on their energy bills, moneysupermarket.com's analysis has discovered.

And bill payers should not overlook their payment method when looking to save money on their utilities, the comparison website urges, as paying monthly by direct debit (MDD) – as opposed to quarterly by cash or cheque (QCC) – could save each household up to £200 on their annual energy bills.

Commenting on the research, Scott Byrom, utilities manager at moneysupermarket.com, said: "Paying by MDD should be the first port of call for people looking to save money. This option allows bill payers to spread the cost of their gas and electricity bills equally each month - rather than having to fork out for the large bill that lands on their doorstep each quarter.

"An online account allows customers to enter ‘actual' meter readings quickly and easily - ensuring they pay for exactly what is used, not an estimation."

Mr Byrom added that switching to an online energy plan "gives consumers the opportunity to keep track of their payments and have a clearer idea of their balance by managing their account online."

Online energy tariffs are cheaper, he argues, because there is less administration involved compared to a standard tariff, cutting down on call centers costs, staff time, and paperwork.

Mr Byrom urges households to keep an eye on the energy market, because it is constantly changing and there are more price cuts on the horizon. Various energy providers, such as British Gas, have already cut their gas and electricity prices by at least 10 per cent this year, and this week has seen Eon cut its gas prices by 3.3 per cent. 

"Scouring the market is crucial for those wishing to reduce their bills and find the best tariff to suit their needs," he concluded.

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