Why Your Energy Bills Are Higher Than Your Neighbours

Many UK households are shocked to see that their energy bills are higher than their neighbors’. This can happen even if their homes and lifestyles look alike. If your electricity bills or gas bills are more than you thought, several factors could be at play. These include how well your appliances work, your heating habits, the quality of your insulation, and the energy tariffs you are on.

Ofgem states that the average UK household pays £1,717 a year for energy costs. However, this amount can change based on your energy supplier, how you use smart tech, and your heating habits. The best way to cut down on energy consumption is to know what causes high energy usage. After that, you can make smart changes to reduce it.

Why Are Your Energy Bills Higher Than Your Neighbours’?

1. You Might Be on a More Expensive Energy Tariff

One big thing that impacts your energy bills is the type of tariff you have. Your neighbor could have a lower fixed tariff, while you may have to pay higher rates.

• If you are using a standard variable tariff (SVT), the energy price cap can change every three months. This price cap gives some protection but does not always mean you will get the cheapest rates.
• Fixed-rate tariffs let you secure a lower price for 12 to 24 months. This stops your bill from going up when prices rise.
• Some energy companies provide discounts for customers who use Direct Debit. If you are still paying every quarter or on demand, you may be spending more than your neighbors.

How to fix it:

• Look at your energy bill to find your tariff type. Compare it with the market rates.
• A smart meter can help you track your kWh usage. This way, you can see if your supplier has fair rates.
• If your neighbor pays less for electricity or gas, think about switching to a new supplier.

You could save £200-£300 each year by changing from a standard variable tariff to a cheaper fixed deal.

2. Your Home Uses More Energy Without You Realising

Even if you and your neighbor live in similar homes, little energy-wasting habits can lead to big changes in your bills.

• Using electrical appliances for too long uses more energy.
• Filling the kettle too much wastes electricity each time you boil water.
• Taking long hot showers makes your hot water tank require more energy to reheat.
• A fridge or freezer set colder than it needs to be uses extra energy.

How to fix it:

• Use a smart meter to track energy use and find out which appliances consume the most power.
• Take shorter showers and heat only the amount of hot water you need.
• Keep the fridge at 3-5°C and the freezer at -18°C to reduce energy usage.

You could save up to £150 a year by cutting down on energy use that is not needed.

3. Your Home Might Have Poor Insulation

A home with good insulation needs less energy to feel warm. On the other hand, a home with poor insulation makes the central heating system work much harder.

• Heat can escape through gaps in windows, doors, loft hatches, and chimneys.
• Old loft insulation might not work well anymore. In the UK, it is best to have at least 270mm of insulation.
• If cavity walls are not insulated, they can lose 35% of a home’s heat. This can make heating bills much higher.

How to fix it:

• Use draught excluders to close gaps around doors and windows.
• Improve loft insulation if it’s less than 270mm.
• Shut curtains and blinds at night to keep warm air inside.

Improving insulation can save you up to £250 each year on heating bills.

4. Your Heating System Might Be Inefficient

An old or poorly working boiler, thermostat, or radiator system may be making you spend more money than you need to.

• Old boilers waste a lot more energy than new A-rated models.
• Cold radiators might show trapped air, which stops good heating.
• If thermostats are set too high, the heating system works too hard.

How to fix it:

• Bleed your radiators often to make heating work better.
• Put in a smart thermostat to manage heating in different parts of your home.
• Set your thermostat to the lowest comfortable temperature (18-21°C) instead of making your home too hot.

You can save money by using a smart thermostat. If you lower the temperature by just 1°C, you could save as much as £145 each year.

5. Your Hot Water System Might Be Costing You More

Heating water for showers and taps uses around 20% of all energy in homes in the UK.

• If your hot water tank is not insulated, it loses heat. This makes your boiler heat water again and again.
• Using several hot taps at the same time wastes energy.
• Washing clothes at 60°C instead of 30°C uses double the energy.

How to fix it:

• Put a jacket on your hot water cylinder to help keep heat from escaping.
• Wash your clothes at 30°C instead of using hotter water.
• Use only the amount of water you need when filling a kettle or bath.
• You could save up to £100 every year.
• These small changes can help you do that.

6. Your Appliances May Be Using More Energy Than Your Neighbours’

Older or less efficient electrical appliances use more energy than newer models.

• A fridge freezer that is 10 years old might use double the energy of a new one.
• Keeping devices on standby can waste as much as £100 each year.
• Washing machines and dishwashers used at high temperatures use a lot of energy.

How to fix it:

• Switch to energy-saving appliances that have good ratings.
• Use eco modes on your washing machines, dishwashers, and dryers.
• Turn off appliances by unplugging them instead of leaving them on standby.
• You can save up to £200 each year.
• A good way to do this is by replacing old appliances.
• It also helps to avoid leaving appliances in standby mode.

Compare Energy Prices

Thinking about changing your energy provider?

Compare Now

How to Compare Your Energy Usage with Your Neighbours’

1. Check If Your Neighbour is Using a Smart Meter to Track Energy Use

A smart meter shows how much energy you use right now. It helps homeowners keep an eye on their electricity and gas. Many energy companies provide free smart meter installations. This helps people track their usage and cut down on waste.

• If your neighbor has a smart meter, they can see which devices use the most energy. This helps them save energy better.
• A smart meter shows daily and weekly usage trends. Because of this, they might manage heating, appliance use, or lighting more efficiently than you.
• Some smart meters let users set alerts. These alerts notify them when energy usage goes too high, which helps avoid wasting energy.

What to do:

• If you do not have a smart meter, ask your energy supplier for one to keep track of your energy use.
• If you already have a smart meter, check the display in your home often. This will help you see which appliances use a lot of energy. You can then change your usage habits to save energy.

2. Compare Energy Tariffs – Are They on a Cheaper Fixed Deal?

One main reason why energy bills differ among neighbors is the tariff they use. Even if you both consume the same amount of energy, being on a more expensive tariff can lead to paying several hundred extra dollars each year compared to your neighbor.

• Are they on a fixed tariff while you have a standard variable tariff (SVT)? If they chose a lower fixed rate before the prices went up, their bills will be more steady and lower.
• Do they pay by Direct Debit? Many energy suppliers give discounts for Direct Debit payments. Those who pay as they go or use quarterly billing might pay more.
• Did they switch energy suppliers lately? If your neighbor recently switched to a new supplier, they could be on a cheaper tariff than your standard variable rate.

What to do:

• Look at your latest energy bill to check your current tariff. You can also contact your supplier for this information.
• Compare different energy tariffs. Switching to a fixed deal might help cut your energy costs.
• Use a price comparison tool to find a better tariff that fits your usage.
• See if your supplier has Time-of-Use tariffs. These provide cheaper energy during off-peak hours.

3. Ask About Home Insulation – A Well-Insulated Home Needs Less Heating

The quality of insulation greatly impacts heating costs. If your neighbor has better insulation, they will use less energy to keep their home warm. This means their heating bill will be lower, even if they set their thermostat the same way you do.

• Loft insulation in the UK should be at least 270mm thick. This helps meet efficiency standards. If your neighbor has new loft insulation and you don’t, their home will keep heat better.
• Wall insulation is very important. If your walls are not insulated, they can let out 35% of the heat from your home. This means your heating system has to work harder to keep things warm.
• Draught-proofing is key. Sealing gaps around doors, windows, chimneys, and loft hatches stops heat loss. If your neighbor has draught excluders and you don’t, their home will feel warmer longer.
• Double glazing is better than single glazing. If your neighbor has double-glazed windows and you only have single glazing, they will lose less heat during winter. This means they will use less energy.

What to do:

• Look at your insulation levels in the loft, walls, and floors to see if they need to be better.
• Put draught-proofing strips on doors and windows to keep cold air out.
• Close your curtains and blinds at night. This will help keep warm air inside and lower heat loss.
• If you have single-glazed windows, think about changing to double glazing or adding temporary insulation films to make your home more efficient.

How Much Can You Save by Fixing These Issues?

Making these changes can help reduce your annual energy bills by hundreds of pounds.

Compare Energy Prices

Thinking about changing your energy provider?

Compare Now