When can I switch energy suppliers without penalty?
If you are looking to switch to a new energy supplier without paying a penalty, here are a few tips to keep in mind.
There are many reasons people might want to switch from their current energy supplier to a new one, from high prices to poor service.
When choosing an energy retailer, there are two factors that repeatedly come up: price and customer service. Which one you give more importance to depends largely upon your personal situation. Individuals on a tighter budget may give the price factor more importance. If you don’t mind spending a little more, then customer service may be just as important to you as price.
At the same time, it’s worth remembering that there are energy retailers in Australia who offer various types of incentives, such as discounts for signing up for a longer contract or using the supplier for both energy and gas.
Why you might want to switch energy providers
Different people switch from one energy retailer to another for different reasons, such as:
- You’re looking out for a better price.
- You’re not happy with the customer service provided.
- You’re looking to change to renewable energy.
- You’re moving home.
- You wish to take advantage of a solar energy rebate.
If you live in Western Australia or certain parts of Queensland, you cannot choose your energy provider. The only exception in WA is in Perth, where you can decide for yourself.
Why will making the switch cost me money?
It can take several months to switch energy providers unless you request your current retailer to make an immediate reading of your meter. Once this reading has been taken, your new retailer can start billing as soon as you settle what you owe to your current provider. If you wish to speed up the process, you may have to pay an extra charge for this, as power companies normally record a meter reading just a few times in an entire year. Of course, the process of switching energy providers may be a bit different if you also have a smart meter.
If you’re switching over from one retailer to another before your contract period with your current retailer has expired, then you may be charged a termination fee for this.
When you’re moving house, you may have to pay an additional charge for a new connection.
When can you switch energy suppliers without penalty?
When you switch over to a new retailer, you can terminate your contract with your previous company without incurring any charges or penalties, provided you do this within the cooling-off period mandated by this retailer. Most of the time, this varies from five to 10 business days.
Also, the following situations could result in further penalties:
- Requesting an unscheduled meter reading.
- Switching over before your contract with your current retailer expires.
- When you move house; however, this can’t be considered a penalty. But it’s an additional payment.
- You have not made the complete payment due to your current retailer.
- You’re terminating your contract with the new retailer after the cooling-off period.
If you keep these points in mind, you can plan when to switch energy suppliers to avoid penalties, saving a few dollars in the process.
How do you compare and switch energy suppliers?
One simple way to compare energy providers is to use a comparison table like you’ll find on RateCity. Using the filters, you can make sure you’re comparing apples with apples, and look closely at the prices and services being offered to give you a better idea of which option may best suit your household.
When you’re choosing an energy plan and looking at market contracts from an energy retailer, it could be worth checking:
- Whether there are any incentives for taking a longer-term contract of two to three years;
- If there are break costs, which could mean paying additional charges if you switch to a more suitable provider in the future, and;
- If the rates offered are fixed for a specific period or variable.
Remember that there’s a lot more to an energy plan than just its price. Any extra features and benefits may offer additional value in different circumstances. It’s also often worth chatting with friends and family to get word of mouth recommendations on which energy companies provide the best customer service.
Once you know which energy retailer and contract you want to switch to, making the switch is often as simple as contacting the new provider to sign their contract. The retailer should then do the work behind the scenes, contacting your current provider to get your plan switched over. There should also be a 10-day cooling off period, so you should be able to cancel the contract without penalty if you change your mind within this period.
Keep in mind that the actual switch could take up to three months as it happens at the time of your next meter reading. Also, the energy distributor that owns the wires and poles connected to your home will not change, so your home’s energy supply should not be affected by the changeover.
