Earlier this month we explained the changes we’ve been seeing in the energy market and how that might affect members’ bills. Wholesale gas costs have fallen significantly and we’re lowering our gas rates for all members. At the same time, we’ll be putting our electricity prices up to reflect higher network and policy costs. Overall, most members will save on their bill, but this won’t be the case for everyone. In this post, we explain how these changes will affect energy bills. We’ll also be contacting everyone individually to let them know what this means for them.
Gas rates down, electricity rates up
We’re lowering gas rates and putting up electricity rates. For most members, this means a saving overall. A typical home using both electricity and gas (as set by Ofgem, the energy regulator) will see a saving of £78 on gas and an increase of £22 on electricity. Overall, that’s a saving of £56 a year on their annual energy bill.
While our tariff was already well below the energy price cap, we’re glad to be passing on an extra saving to lots of members. Bulb is now £218 below the ’Default’ energy price cap, which limits the annual cost of energy for people who pay by direct debit. For Prepay members, Bulb prices are £174 below the ’Prepayment’ price cap, which limits the cost of energy for people who top up.
We’re also updating our standing charges so they reflect the different costs to transmit energy in different regions. Historically, we’ve had a single standing charge for everyone, even though our cost to supply energy varies across the country.
How does this affect your bill?
While these changes mean most members will save on their annual bill, this won’t be the case for all Bulb members. Our members buy and use energy in different ways. Some people only use electricity while others also have gas with Bulb. Some people pay monthly and others top up as they go. We’re making a number of changes and what happens to your annual bill will vary depending on your particular set up.
Most members using electricity and gas will save
Most members who use both electricity and gas at home will save. Despite an increase in electricity rates, the significant decrease in gas rates will mean an overall saving. The annual bill for a typical home on Bulb will fall from £1,000 to £944 per year. Members who use an unusually large amount of electricity may see an overall increase.
Bulb Prepay members will see a smaller decrease in their annual bill. It costs us more to serve members who top up for their energy, reducing the overall saving we’re able to pass on. After these changes, Bulb Prepay will still be one of the cheapest prepay deals on the market, renewable or not.
Electricity-only members will see an increase
Members who just use electricity at home will see an increase in their annual bill. The annual bill for a typical home only using electricity will rise from £501 to £523.
When are the changes happening?
The changes will come into effect for current Bulb members on 1st April 2020. We’re contacting everyone to let them know what this means for them. We don't lock members in, so if a member is unhappy with the new rates they can leave at any time without any exit fees.
People who pay monthly and switch from today (2 March) will be on our new rates once their switch completes. People with prepay meters who join between now and 10th March will be on our current prepay rates once their switch completes. Prepay members joining after 11th March will join on our new prepay rates. This delay is due to the time it takes to share the new prices with all the top up locations we work with across the country.
What caused the changes?
If you’d like to know what’s behind these changes to our prices, have a read of our recent update from February – there’s lots of detail in there.