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How to understand your energy bill

Energy Bill

With gas and electricity costs so high, it’s essential to understand how your energy bills are calculated. Providers have improved the way they present their charges, but the average bill can still be daunting. We’ve analysed typical gas and electricity bills to help you understand what you’re paying and why.

Choose your energy provider:

1 Account Number

This is your unique account number. If you have it to hand when you call the company, it will help them identify you more quickly.

2 ‘Actual’ or ‘Estimated’ reading

Your supplier will state whether your bill is based on an actual meter reading or on an estimate of what you’ve used. Obviously, your bill will be more accurate if you provide actual readings or your meter is read by the company. If you have a smart meter, the device will send the information direct to the company. All homes will have smart meters by 2020.

3 Statement period

This is the period of time for which you are being charged.

4 Your tariff

This is the name of your tariff. When you shop around for a competitive energy deal, you will be asked for the details of your current tariff.

5 Next steps

The bill used here is settled each month by direct debit, where payment is collected automatically from your bank account, meaning no action is necessary. If you pay by cash or cheque, you’ll be told how much you need to pay, and by when. If any other action is required on your part, details will be included here.

6 Account information

This section provides a breakdown of recent account activity, including how much you have been charged, how much you have paid and the current account balance (in debit or credit). It also provides details of any discounts you enjoy, along with additional charges, and provides the amount of VAT you are paying. VAT on energy bills is levied at 5%. A detailed breakdown of charges is provided at the end of your bill.

7 Could you pay less?

You may well be able to switch to a cheaper tariff from your existing supplier. The details of its other competitive tariffs are provided here. You should also check what is on offer from other suppliers via the MoneySuperMarket comparison service.

8 Your energy use

This part of the bill shows you how much energy you have used in the period covered by this bill compared to the same period last year. If actual meter readings were not used, this will have been estimated. Once you can compare your current and past consumption, you can consider energy saving measures to help you bring your bill down.

9 Electricity MPAN

The Metering Point Administration Number (MPAN) sits inside a panel of seven boxes with a capital ‘S’ in front. MPANs are used as a reference point by suppliers to help them identify an electricity supply point. You might be asked for this number when you switch supplier.

10 Energy charges in detail

This is a detailed breakdown of what you are being charged for this billing period. It includes details of how much you are being charged for each unit of fuel you use. Some suppliers levy a standing charge, which is a flat rate you pay before you’ve consumed any energy. Other companies don’t have a standing charge, preferring to charge a higher rate for a set amount of units, then a lower rate for all the units you use after that. This might be described as primary and secondary consumption. NSC Option refers to a no standing charge arrangement

11 Meter serial number

This meter serial number is printed on the front of each of your meters (gas and electricity). If you have a problem with your meter, you might need to quote this number when you contact your provider.

12 Gas MPR

The gas Meter Point Reference number is 10 digits long and identifies the meter at your property. MPRs are used as a reference point by suppliers to help them identify a gas supply point. You might be asked for this number when you switch supplier.

13 Additional charging information

This section provides details of any discounts to which you are entitled – such as a discount for getting both gas and electricity from the same supplier. You might also earn a bonus for settling your bill by direct debit.

14 Gas units to kWh

If your meter uses imperial measurements, this formula can be used to convert the amount you use into meters cubed, which is a metric measurement.

15 Where does your money go?

This pie chart shows the typical costs for each £100 you spend on energy.

16 Your energy use

This part of the bill shows you how much energy you have used in the period covered by this bill compared to the same period last year. If actual meter readings were not used, this will have been estimated. Once you can compare your current and past consumption, you can consider energy saving measures to help you bring your bill down.

17 Contact numbers if you have a supply problem

These are the numbers to call if you suspect a leak or smell gas, or if there is interruption to your electricity supply.

18 Previous reading

This shows the readings from your previous bill and this one. The amount of energy used between these two readings determines how much your bill is.

19 Units used

Your meter measures electricity in units known as kilowatt hours (kWh). This sections shows how many units you used since your last bill. Depending on the age of your meter, gas is measured in either cubic meters or cubic feet. A formula is used by the energy companies to convert these units into kilowatt hours. The reading in kWh is then used to determine the charges to you.

20 Standing charge

A set charge that covers maintenance costs for your supply. Some companies omit this and instead charge a higher rate for the first set number of units consumed, then a lower rate afterwards.

21 TCR

The tariff comparison rate (TCR) is designed to help you compare the cost of tariffs from across the energy market.

22 Predicted cost

This is an estimate of the cost of your energy based on what you have used to date.

Ready to compare and save?

What you'll need to begin

  1. Your postcode
  2. Your latest dual fuel bill or gas and electricity bills
  3. Your annual Energy Statement
Compare Now

Don’t worry if you haven’t got your bill or statement to hand – if you know the name of your energy provider, we can ask a few basic questions to come up with an estimate of how much energy you use.

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