In recent months, many people have seen their bills go up. That’s why understanding your energy bill is more important than ever. This is mainly because the OFGEM price cap, which controls how much energy companies can charge for gas and electricity, has increased. When this happens, energy companies raise their prices, which can make your bills higher. Let’s take a closer look at the typical household bill, explain what your energy bill includes, why it’s increasing and how to start understanding your energy bill in simple terms.
The ongoing increases in the OFGEM price cap has affected household budgets. When the cap goes up, energy companies typically raise their prices, which means you might see your bill go up too. If your bill is higher than you expected, it’s likely due to this change, which you can’t control. It’s important to keep track of these changes so you can manage your budget well.
If you’re not understanding your energy bill clearly, it’s easy to overlook key details or pay more than you need to.
Many people confuse estimated and actual meter readings. If your bill shows an “E” for estimated, it means the supplier has made a guess about your energy usage, which may not be accurate. To avoid this issue, always provide your actual readings when prompted.
The tariff you are on plays a critical role in determining your energy costs. Some consumers overlook this detail and don’t realise they are on a more expensive tariff, especially when not actively reviewing their supplier’s rates.
People often fail to check payment dates effectively. Understanding when your payment will be taken helps ensure you are prepared, preventing surprises in your monthly budget.
Knowing how to read and understand your energy bill can help you to make informed decisions about your energy usage and chosen supplier. Here’s a breakdown of the key parts of a typical energy bill:
These show your most recent gas and electricity usage. A “C” indicates a customer reading, while an “A” is for an actual reading, and an “E” signifies an estimated one.
This indicates how much you need to pay by the next direct debit, or the amount due if you pay upon receipt of your bill.
Your total energy consumption during the billing period, which helps to identify if any usage spikes may need investigation.
Unique identifiers for your electricity (MPAN) and gas (MPRN) supplies. These are useful when switching suppliers.
Outlines details about your contract and notifications regarding tariff changes, crucial for avoiding default tariffs.
The specific energy plan you’re on, which can help when comparing energy prices if you choose to switch.
Shows whether your account is in credit or if you owe money. A positive balance means you’ve overpaid, while a negative indicates outstanding debt.
Lists when the bill was issued and the timeframe it covers, essential for tracking usage over time.
Offers a look at predicted costs for the upcoming year based on your typical usage.
Understanding these components can help you make sense of your bills and ensure you’re not overpaying for energy.
As energy costs continue to rise this spring, arming yourself with knowledge is key. Familiarising yourself with your energy bill can help you spot errors, get better rates, and make positive changes. You can always talk to LEAP on an advice call if you need help managing this process.
