MoneySavingExpert's Martin Lewis has advised people to take an energy meter reading before huge price hikes come into force.
The energy price cap will rise by 54% on April 1, regulator Ofgem has confirmed. This means default tariffs paid by direct debit will rise from £1,277 to £1,971 - an increase of £693.
Prepayment customers will see a bigger jump, with their price cap going up by £708, from £1,309 to £2,017. However, as the higher prices come in, Martin has advised households to take a meter reading, reports the Mirror.
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By taking a reading on March 31, you can then go to your energy provider and explain exactly how much energy you used before the price cap increase came into effect. Speaking on his ITV Martin Lewis Money Show Live broadcast last week, the MoneySavingExpert founder said: "That way you draw a line in the sand that says to your energy firm, I've only used this amount at the cheaper rate.
“Don't start charging me more on the higher rate and estimating I use some of it afterwards."
In a separate video posted to social media this week, Martin also reminded those who are on older prepayment meters to check if they can “stockpile” energy now. The logic is that if you top up now, but use this energy after the price cap changes, you’ll be charged for your gas and electric at the rate that applied when you topped up.
Your rates shouldn’t change until the first time you top up following a price adjustment. If you have a smart prepayment meter, this stockpile trick sadly won’t work as these meters are updated remotely with the new rates on the day of a price change.
MSE contacted 11 of the biggest energy suppliers - including British Gas, SSE, E.on and EDF - and only one said the stockpiling trick wouldn’t work. Scottish Power was the only provider that said the additional amount you would've paid under the new rates would be recovered by adding a small amount of debt to your meter at your next annual statement.
MSE has asked Ofgem if Scottish Power is allowed to do this but hasn’t issued a further update.
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