When I am filling contract with my energy supplier what is the best option to pay for electricity ?

Question

I have five options:
1. Monthly Direct Debit
2.Quarterly Direct Debit
3.Standard
4.Prepayment
5.Energy Card

What mean each option? Which is the best choice ?
What is an "Electricity Reference Number" ?

Thanks in advance for your answers!

M.

Answer 1

With any Direct debit, the electricity company estimates your electricity usage and bills you accordingly each month or quarter. They always overestimate your usage, and if you look at your bill, you will see that the so called meter readings are always guesstimates.

Although electricity/gas companies claim to give you a discount for using direct debit, it is seldom in your benefit. Personally, I use the standard tariff, each month I put aside a fixed sum into an instant access savings account. Then quarterly, when my bill arrives, if they have used an estimated reading, I contact the company and give them a correct meter reading and ask them to recalculate the bill. When the new bill arrives I pay it immediately from the savings account. I do this with all the utility bills, gas, water and electric.

You still have to pay the bills, but what you are overcoming is the utility companies taking excess money from your account and earning interest on that money. It may only be 4 or 5 pounds that you overpay in a year (although in my experience it is nearer 50 or 60 pounds). Just think how much interest these companies get from investing YOUR money.

Answer 2

Most energy suppliers offer discounts when you pay by Direct Debit, monthly is best for most as you spread the cost more evenly throughout the year.

Answer 3

Monthly Direct Debit

If you pay by direct debit you usually get a discount.

Answer 4

Monthly direct debit as it's easier to manage when you change providers.

Answer 5

quarterly direct debit. prepayment is the most expensive way.