The Ultimate Utility Bill Guide for the UK
Are you a new home owner or moving out of your family home for the first time? This can be hugely exciting, but equally nerve-wracking. There’s a lot of information to take in about your newfound responsibilities.
The likelihood is, this will be your first time paying utility bills. It’s a term we’re all familiar with, but may not fully understand. What are utility bills? How do I pay them? Can I make savings on my utility bills? The list goes on.
Thankfully, acasa is here to tell you absolutely everything you need to know. acasa is a home management platform and bill-splitting app for house sharers and we’ve put Utility Contractor Manchester together this ultimate guide to UK utility bills.
You will learn everything about utility bills
We’ll give you the low-down on:
What utility bills are.
What household bills are not utility bills.
How your utility bills impact your credit score.
How to set up utility bills in a new or rented house.
How utility bills can provide proof of address.
Where to change your address if you move.
How to reduce your utility bills.
Alternatively, use acasa to manage your bills
With acasa you can manage all your bills in one place – learn more.
What are utility bills and why do you need them?
Your utility bills reflect the most basic costs associated with running your home. This includes gas, electricity and water.
These are all things that you simply can’t do without. Nearly everything in your home relies on power, from your lights to your TV, your computer, WiFi connection and any security system you might have in place—such as a burglar alarm. Gas heats your water and living spaces and fuels your oven, ensuring you can cook your food!
We need utility bills to account for how much of these vital services we use, and to let us know how much we owe to our suppliers.
Utility bill meaning
The purpose of any utility bill is to collect payment for the gas, electricity and water you’re using.
Your utility bill breaks down your use of gas, electricity and water over a set period and lets you know how much this costs. It should display how many units you have used and the cost per unit. It will also display the total cost for services used.
Most utilities rates are fixed for a certain period of time so you should know what to roughly expect from your bill.
You should expect to pay for utility bills such as gas and electricity in regular monthly instalments. Any underpayment or overpayment will be settled at the end of your contract with the supplier.
Facts about utility bills
Water bills are more likely to be charged on a quarterly basis, so you can expect 4 bills per year.
Paper utility bills are sent to your address, although many companies are now moving to email based bills.
Choosing to go paperless with your billing can come with incentives such as £5 – £10 off your bill.
Each bill will indicate appropriate methods of payment, as accepted by your supplier.
What is the difference between utility, electricity, energy and gas bills?
Utility bills is an umbrella term that includes your electricity, gas and water usage and costs.
It can also include bills for essential services such as those provided by the council, like sewer services. Optional services such as cable tv or mobile phones are not considered to be utility bills.
Often the words utility, electricity, energy and gas are all used to mean the same things. Utility bill or energy bill commonly covers electricity, gas and sometimes even water. A landline phone is not considered to be a utility bill.
What other household bills do I need to worry about?
Aside from electricity, gas and water bills, you may have other costs associated with running a household. These could include:
Rent or mortgage payments
Internet and mobile phone connections
TV licence, cable TV contract
Credit card payments
These bills are not considered utility bills. Other general household costs such as grocery bills are also not included.
How do utility bills impact my credit score?
How you pay your utility bills does impact on your credit score (or “credit rating”), as utilities companies often share payment history with credit companies.
What does this mean?
Well, if you have a solid record of paying your bills on time, you will usually have an easier time securing a loan or contract (for example a mobile phone contract). If you miss a payment it may show you have a higher risk of defaulting on a loan. That means lenders may not loan you money, or you may be charged a higher interest rate.
The last twelve months of credit history is usually the most important. If you have missed payments in the last twelve months, wait until you build up a stronger credit profile. Lenders can be forgiving of past blemishes. This should happen if your current payments are happening on time.
You can help avoid late payments by setting up direct debits with your bank. You could also set a recurring reminder in your calendar. Making regular payments will reassure lenders that you are trustworthy.
How to set up utilities
How to set up utility bills for the first time
It is important to establish your utility connections when you first move into your new home. It doesn’t matter if you are renting or buying – you must take care of it. The agent or landlord is not responsible for this.
If you are moving into an established home the electricity and gas supply will already be in place, ready for connection once you choose your energy provider.
You will need to make sure the bills are being charged to you and not to the previous owner or tenant. The utility company will usually set the tariff to the ‘standard’ option. This is typically the most expensive rate. Here’s how to take control of your utilities and make sure you are getting the best prices.
Find out which company is providing the utilities. If you are unsure, visit the UKPower website to find out.
Take a meter reading on the day you move in. Photograph the meter if you can to verify. This will help you avoid paying any charges the old tenants incurred.
Find out which tariff you are on, and if it’s the best deal. Comparison sites such as Moneysupermarket.com and uSwitch will help you compare utility prices based on your usage. Investigate your options and choose the right one for you.
There are two different ways you can be supplied electricity. Which one is being used at your property will influence how you set up paying for it.
Each month or quarter you will receive a bill that outlines how much energy you used and how much you need to pay. Make sure to read the meter, then call the energy provider and switch to the best tariff for you when you move in.
This option is popular with landlords. There is little risk a tenant can leave without paying an outstanding bill. Instead of receiving a bill, you buy credit (usually on a key, card or voucher) and add it to the energy account.
The downside is this option is usually more expensive than a postpaid credit meter. It is important to keep track of your credit so you don’t lose power at a time when you are unable to buy more credit.
Make the switch by contacting the provider and start saving money.
How to set up utility bills when renting
If you are renting your utilities may be included in your rent. Confirm with your landlord if you are unsure. If your utilities are not included in your rent you will need to set up accounts yourself, and follow the guide above under the ‘How to set up your utilities for the first time’ section.
If you are sharing a house with others or renting a room in a property there are other factors to consider. The utilities may already be established in another tenant’s name. If so, you may need to come to a private arrangement about how you will contribute to the cost of utilities.
You may wish to add your name to the utility account so everyone is liable for the cost. It can be a risk to take on the bill in your name alone. Using a bill splitting and household management app like acasa (previously called Splittable) can help to keep track of when bills are due. It will also track who needs to pay their share.
How to set up utility bills in a new home
The process to establish utilities in a brand new home are similar to an established home. Often an energy supplier will make a deal with a property developer to supply the new homes.
It is up to you to investigate and make sure you are on the best tariff for your needs. As you can’t establish your usage history, you will need to estimate your usage.