Financial guru Martin Lewis' team at Money Saving Expert has issued urgent advice that households need to do before the energy price hike comes in.
The energy price hike is just round the corner and households in Scotland can expect their gas and electric bills to sky rocket.
Already many are noticing their bills rising and from April 1, bills are set to increase by an extra £693 a year on the average household bill.
The energy price cap will rise by 54 percent, forcing the average bill to hit £1,791 while those one prepayments meters will see costs go up by £708 to £2,017.
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Martin Lewis has warned that these prices are likely to rise again in October.
While these prices are eye-watering, as the Daily Record reports, the team at MoneySavingExpert.com have shared a clever - and totally legal way - for those using a prepay meter to delay the price cap through a ‘loophole’ which will work for gas or electricity top-ups not using a smart meter.
Additionally they have also shared a range of urgent tips everyone needs to do before the new. price cap comes into force
We’ve summarised the need-to-knows below and you can read the full details on the MoneysavingExpert.com website here.
Prepayment meter loophole
Those who use older, non-smart prepayment meters, who are still using keys and cards to top up can 'stockpile' gas and electricity before prices shoot up on April 1.
Money Saving Expert explained: “The rates won't change until the first time you top up following a price change, so any credit you've added before then will be charged at the old rates.
“If you have a smart prepayment meter, this won’t work as these meters are updated remotely with the new rates on the day of a price change.”
All you need to do is top up as much as you can afford up to the limits of the meter before April 1.
This will work for all energy suppliers, except Scottish Power - the full list is here.
The team at Money Saving Expert also checked with Ofgem, who said this trick should work.
An Ofgem spokesperson said: "Smart prepayment meters update prices automatically - so topping up in advance would not make a difference. With non-smart prepayment meters, the price customers pay is fixed at the point they top-up.
"This means that any built up credit is spent based on the price of energy at which that credit was purchased. So a price increase could temporarily be avoided by building up credit in advance, though this would also work the other way if the price went down."
Start doing regular meter readings
Households are being urged to not forget about metre reading with the consumer website is urging everyone to do these on a regular basis, especially on March 31 - before the price hike kicks in.
It warns: “Don't rely on estimated use - unless you've a smart meter that does it for you, make sure your meter readings are up to date when the price cap changes on 1 April.
“This is to ensure you're not paying for more than you need to at the higher rate (as otherwise the firm will try to calculate what was used before and after).”
£150 Council Tax energy rebate update
Martin Lewis has explained exactly how the council tax rebate works-giving it the name 'loan-not-loan'. You can read more about that here.
Scottish councils will be able to decide whether to give households the £150 as a cash payment or credit off Council Tax bills - the full details haven’t been released yet.
The support will apply to those in council tax bands A to D, plus those eligible for Council Tax reductions, some 1.85 million Scots households will receive the support.
Households will be paid automatically - you do not need to apply.
The Scottish Government hasn’t provided a specific date for when the money will be distributed but said households will receive payments in April.
Energy tariffs - stick or switch?
Earlier this week, the founder of the consumer website, Martin Lewis, shared a 10-minute video on social media and YouTube sharing crucial updates on energy tariffs and whether customers should be locking into a fixed deal right now or still “do nothing”.
This comes as Eon customers are being an offered a fixed rate tariff which is the same price as the price cap-in comparison to other fixed tariffs that are higher.
He urged his followers to 'bite its hand off and take it."
He did warn though: "“Do be aware by doing this now, you'll miss out on the current much cheaper current rate by about a month, yet there's no guarantee how long it'll be on for. Overall if predictions are right, it should win though."
For those who are not with Eon, the financial journalist continues to to reiterate that people should just stick with what they have.
Martin explained: “Some of you might be lucky enough to still be on a cheap fix from before this all happened. If so, just stick with it for as long as you can, because energy prices have increased so much that you'll be paying way below what you'd be paying if you moved anywhere else.
“Even the idea of moving quickly to try and bag a bargain is just not worth it, so stick on your cheap fix for now."
He continued: "This brings me to the next issue, the big question, should you be looking into a fixed tariff right now?
“The rule of thumb is this; I would not switch to a fixed deal unless it was less than 75% more than the current price cap, or if you want to base it on the April price cap, no more than 15% more than the April price cap.
"So if you can find a fix within that price range then it is worth getting. But you will not find those prices on a comparison site. There are no open market options close to that price - they're all 40% more than the April price cap at the very cheapest.”
You can watch the full video on the MoneySavingExpert.com website here.
You can also sign up to the weekly MoneySavingExpert.com newsletter here.
