How to Save Money on Your Utility Bills


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By Sarah Watts
Updated on Tuesday 2 March 2021

A light bulb full of pennies

With energy bills on the rise, Ofgem’s predicted price cap increase and lockdowns keeping us at home, many UK households’ energy bills are spiralling out of control. And, if you’re living on a budget, knowing how to save money on your utility bills is crucial if you want to avoid getting into debt.

According to Ofgem, the average household pays around £1,254 per year (approximately £105 per month) for their gas and electricity bills. However, due to the latest national lockdown during the cold winter months and many fixed energy tariffs ending in January 2021, we fully expect this amount to be much higher for many homes in the UK.

But, with all these price increases and non-stop lockdowns, ‘how can I save money on my utility bills?!’ I hear you ask incredulously.

Well, the good news is, there’s an awful lot you can do to slash your gas and electricity bills, so read on for invaluable tips and tricks on how to reduce your utilities and make your home more energy-efficient.

Been with the same energy supplier for years? You could save up to £300 or more per month by switching:

The 6 best ways to save money on utilities

1. Switch energy provider(s)

2. Make your home more energy-efficient

3. Pay for your utilities by direct debit

4. Heat your home more efficiently

5. Apply for a Green Homes Grant

6. Apply for other government grants

How to switch energy providers

Switching energy providers can save you up to £300 per year and because your new and old energy providers do all the work for you, switching providers is much easier and quicker than you think.

To switch energy providers you will need to:

  • Have your postcode, current supplier’s name and current tariff details to hand - check your utility bills for tariff information.
  • Compare energy quotes online to get the best deal possible.
  • Know how much energy you use - when comparing quotes, you will very often be asked how much electricity or gas you use per day. You will need to compare your last two meter readings to calculate this.
  • Decide whether you want a fixed or variable rate tariff. A fixed tariff means you will be tied to the same energy provider for 12 months but your price will not change, even if prices drop (which is highly unlikely in the current climate). A variable tariff means your price can vary and go up or down. Fixed tariffs are usually cheaper.
  • Arrange to pay by direct debit to save further costs.
  • Confirm you’re committed to a new supplier who will then take over dealing with the changeover - this usually takes 2-3 weeks. You have a ‘cooling-off’ period of 2 weeks (14 days) to cancel the agreement if you change your mind.
  • Give a meter reading - your new supplier will usually contact or email you to ask for a meter reading about 5 days before you switch. They will ensure this meter reading is passed on to your current (old) provider so you do not pay twice for the same energy.
  • Set a reminder to do all of the above next year!

How to make your home more energy efficient

The most common ways to save electricity and gas to reduce energy bills are:

  • Install cavity wall and loft insulation
  • Replace an old boiler
  • Set your thermostat and boiler temperature as low as possible
  • Use a heating timer and have the heating turned off when you’re not at home
  • Take short showers instead of long showers or baths
  • Install double or triple window glazing
  • Draft proof windows and doors
  • Shut internal doors
  • Close heavy curtains at night
  • Install solar panels
  • Use energy efficient appliances
  • Switch appliances off at the plug instead of leaving them on standby
  • Use low-energy bulbs and switch off lights in unoccupied rooms
  • Put washing machines and dishwashers on quick, low temperature ‘eco’ cycles
  • Avoid overfilling your kettle - only use what you need
  • Use smart devices and a smart meter to have more control of your usage

How to pay for your utilities by direct debit

By far the most popular way people choose to pay their energy bills is by direct debit. Not only can you save money by paying this way, but it also takes the hassle out of remembering to pay your bill every month, not to mention that missing utility payments could affect your credit score.

If you currently pay by another method, you can easily change to paying by direct debit by contacting your energy company or, if you use an app or have set up an online account, you can usually swap to paying by direct debit this way without needing to speak to anyone.

You can opt to pay your bills either monthly or quarterly, whichever best suits you and your finances best.

When you choose to pay by direct debit, your provider will calculate or estimate how much energy you will use over the next year and divide it by either 12 (for monthly instalments) or 4 (for quarterly payments) to work out your payments.

You will usually be given an option of dates to choose from for when the direct debit payment leaves your account - most bill payers opt for the first day of the month to coincide with their monthly wages being paid just before.

Most energy providers like you to provide meter readings on a regular basis (unless you have a smart meter installed which means you don't need to do this) so they can change your monthly or quarterly direct debit payment, should there be a huge deficit and they need to. Under the Direct Debit Guarantee, your supplier should give you 10 working days’ notice before making any changes to your direct debit payment.

If you struggle to manage your finances or are living on a tight budget, instead of paying by direct debit, you could opt to have a prepayment meter installed. This way, you can pay for your gas and/or electricity upfront and ensure you never get in debt. Paying in this way also makes you acutely aware of how much energy you’re using and should make you more energy-efficient in your home as a result (i.e. switching off lights in unoccupied rooms, closing doors, not leaving your TV on standby, etc).

How to heat your home more efficiently

There are lots of ways you can heat your home more efficiently from replacing an old boiler to using space heaters - take a look at our guides for lots of handy energy-saving tips:

How to apply for a Green Homes Grant

If you’re a homeowner or a landlord, you can apply for the government’s Green Homes Grant to get help with costs associated with making your home more energy efficient. To find out more and how to apply, check out our guide: What is the Green Homes Grant?

In addition to a Green Homes Grant, you should check whether you’re entitled to a free boiler replacement grant.

How to apply for other government grants

In addition to the above-mentioned grants, you could also be entitled to (click on or tap the links to find out if you’re entitled and how to apply):

  • A winter fuel payment between £100 to £300 (if you were born on or before 5 October 1954 and get a state pension or certain other social security benefits). Most people who meet the criteria for this payment do not need to apply as this payment is automated.
  • A cold weather payment from your local authority of £25 (if you’re getting certain benefits or support for mortgage interest and the average temperature where you live is recorded or forecast to be zero degrees celsius or below for 7 consecutive days). You can get more than one cold weather payment - you can apply for one every time the temperature falls below 0 for 7 days on the trot.
  • A warm home discount scheme from your energy provider worth £140 (if you’re on a low income or you get the guarantee credit element of pension credit).

So before the next energy price increase (expected this year), make sure you do all that you can to save money wherever you can by switching utility companies, saving energy and applying for any government grants you may be entitled to.

To get a new energy quote now, tap the button below to get started (obligation-free), or for more information, take a look at our related guides:

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