If you’re a first-time buyer getting ready to move into your new home, congratulations! After all, getting a foot on the first rung of the housing ladder is never easy.
But your work isn’t done just yet. Before you move in, you need to find the best electricity and gas deals to help keep your day-to-day living expenses as affordable as possible. The big question is: how do you find the right energy supplier for you? Here’s all you need to know about getting electricity and gas quotes to help first-time buyers save money and stay warm.
The importance of choosing the right energy supplier.
Until the late 1980s, you simply got your gas from the gas board and your electricity from the electricity board. But nowadays you have the right to go with whichever electricity and gas supplier you prefer, choose from a wide range of competing tariffs, and switch energy providers whenever your contract is up.
Before you make a decision on an electricity and gas quote, you also need to think about things like customer service, commitment to sustainability, and suitability for your individual needs. You might even want to get your electricity and gas from two different suppliers, rather than opting for a dual fuel tariff.
Obviously, this can all make things confusing for first-time homeowners, which is why we’ve created this handy guide. It explains all the things you need to know and consider before getting electricity and gas quotes as a first-time homeowner.
Understanding electricity and gas quotes for first-time buyers.
The fact you’ve been able to save for a mortgage deposit shows that you know how to budget your income. But electricity and gas bills can still prove tricky. That’s because whichever supplier and tariff you choose, you’re always going to end up paying for the energy you actually use, not the amount you were quoted in advance.
It’s essential to understand that any electricity and gas quotes you get right now are simply going to be based on average use. If you leave your heating on 24 hours a day, you’ll pay far more than your quote. And if you’re canny with the thermostat - and turn lights off when you leave a room, like your parents always told you - it’s possible to pay less. But before we get into that, let’s talk about how to compare energy quotes that are based on average consumption.
How to compare energy prices using online quotes.
The electricity and gas quotes you can find online are all based on average use, defined by the energy regulators (Ofgem), using the standard energy measurement unit of kilowatt Hours (kWh).
To view your quote simply pick the category that applies to your home:
Low: If you’re buying a flat or small house, the average use for this scenario is calculated as 1,800 kWh of electricity and 7,500 kWh of gas.
Medium: If you’re buying a standard 2-3 bedroom home your quote will be based on average use of 2,700 kWh of electricity and 11,500 kWh of gas.
High: If you’re among the lucky first-time buyers that are buying a 4+ bedroom home, average use is calculated as 4,100 kWh of electricity and 17,000 kWh of gas.
Actual: For use if you have historic records of the property’s energy use in kWh.
What effect does the energy price cap have on your energy prices?
Before we get into all of the personal and lifestyle factors that can affect your choice of electricity and gas provider, let’s talk about the energy price cap.
In a nutshell, the energy price cap is the maximum amount of money that energy suppliers are allowed to charge you for every unit of energy you use on a Standard Variable Tariff, including standing charges. This is reviewed every three months by Ofgem, the official energy regulator, and can go down as well as up, which is why a fixed tariff may be the best option while you’re finding your feet as a first-time homeowner.
It’s important to understand that the energy price cap is also based on the average uses we talked about above. If you use more energy than the average figures, you will end up paying more than the current energy price cap figure, and more than the electricity and gas quote you received as a first-time homeowner.
Looking to keep things simple? At E.ON Next, our Next Pledge tariff guarantees to keep your costs below the Ofgem price cap, saving you £50 a year based on average annual consumption.*
Which are best for first-time buyers, fixed or variable energy tariffs?
Which type of tariff is best is really up to you. Fixed tariffs give you quite a lot of certainty, as your energy price will remain the same for the length of your contract – which can be up to 24 months long. Many people prefer fixed tariffs, as it allows them to budget more effectively, and means they aren’t subject to fluctuations in the energy price cap. Our Next Pledge* tariff is guaranteed to beat the energy price cap by an average of £50 a year for dual fuel customers.
Having said that, a variable tariff can sometimes end up being cheaper over the same timeframe. Variable tariffs fall and rise with the energy price cap every three months, which means that you could benefit from any falls in energy prices.
Should first-time homeowners choose dual fuel or single energy suppliers?
First things first, what does ‘dual fuel’ actually mean? Simply that you've chosen one energy supplier to provide you with both gas and electricity, instead of buying your gas from one and your electricity from another.
Dual fuel tends to be the most popular option, as you may simply find it more convenient to have just one bill to manage. Having said that, you may find deals that make it cheaper to buy from two separate suppliers. Or perhaps your new home doesn’t have a gas supply anyway.
What's the cheapest way to pay for my electricity and gas?
The energy price cap is set slightly differently for Direct Debit and standard credit customers, with the price for DD customers usually being lower. It's also worth bearing in mind that Direct Debit makes it easy to spread the cost of your energy use throughout the year, and helps you avoid missing payments, which might negatively affect your all-important credit score.
Do I need to have a smart meter installed?
It's not yet a legal requirement to have a smart meter, but it really does make sense to get one, for reasons like these:
No more meter readings for you, your smart meter sends us readings.
No more estimated bills, because smart meters ensure they’re always accurate.
An in-home display unit lets you see how much energy you’re using in real time.
Having all this information means you could reduce your annual bills by around 5%.5
It’s easy to find out more and book a free smart meter installation too.
Cost versus service quality of energy suppliers.
While electricity and gas are significant household expenses, especially for first-time homeowners, price isn’t the only thing you might want to consider. After all, great customer service isn’t just a nice-to-have, it can be essential if some sort of problem arises.
It’s a good idea to check out customer reviews, where you can see exactly what people like you think of each energy company, and even look at the Ofgem website to see what they say.
Incidentally, E.ON Next is rated Excellent for customer service on Trustpilot. You might also want to check out this Ofgem report into customer service levels, where they reported that E.ON Next received fewer complaints than any other major energy supplier.1
Environmental considerations and the cost of EV ownership.
We know that many first-time buyers want sustainability as well as cost-savings when they’re considering which energy supplier to choose. At E.ON Next, we like to say we’re an energy company that wants to be a sustainability company. So among our money-saving tariffs like Next Pledge, we also offer tariffs such as Next Gust, which is backed by 100% renewable2 electricity generated off the blustery Yorkshire coast.
Next Drive is our dedicated electric vehicle (EVs) tariff. As well as renewable electricity, it also offers you the longest overnight off-peak period in the market3, so you can fill up your car’s battery for less than £2.70.4
If you care about the environment, it really is worth making sure that whichever utility company you choose offers you the sustainable options you need.
Can I sell my excess energy from solar panels?
If you’re lucky enough to have solar panels on your first home - or have enough spare budget to get them fitted - you can benefit from more than just the chance to generate energy for your use. If you sign up for the Smart Export Guarantee (SEG) scheme, you can also generate some very useful extra cash by selling your excess renewable electricity to the national grid.
Are heat pumps worth it for first-time buyers?
While government plans to ban the sale of gas boilers from 2035 have now been scrapped, the fact is that air source and ground source heat pumps are a far more sustainable and efficient alternative. That’s because they’re three to four times as efficient6 at turning energy into heat as gas boilers. They can also benefit from special tariffs like Next Pumped, which not only offer periods every day where you’ll pay a fraction of the price of the standard unit price for electricity, you can also enjoy the fact that you’ll be using 100% renewable2 electricity.
How does a first-time buyer turn an energy quote into an energy supply?
We always recommend that first-time buyers do their research properly, and get a few gas and energy quotes before making a decision. After all, you could be locking yourselves into a contract for up to 24 months. So you’re entitled to make sure you’re getting the right energy deal for your budget.
Importantly, remember that your choice of energy supplier is 100% your decision. If you’re buying a new-build home, you don’t have to go with the builder’s recommendation. And if you’re buying an existing property, you don’t have to stay with the existing energy supplier. That’s because every energy deal ends when you sell and move out of a home. Leaving you, as first-time buyers, with absolute freedom to get electricity and gas quotes from whoever you like.
What happens when you’ve made your choice though? How do you set the ball rolling to get an energy supply to your new home? Well, the good news is, that’s the simple part. Once you’ve found a quote you like, you can sign up online in just a few clicks and let E.ON Next - or any other energy supplier of your choice - take care of the rest.