Utility overspends and the cost of living crisis
What is the utility cap and how does it effect my tenancy?
The utility cap was introduced by Ofgem and it effectively limits what can be charged for each individual unit of electricity and gas (and the standing charge).
Now the price caps are well established, and fixed term contracts have mostly come to an end, the costs to landlords of offering an inclusive service are rapidly increasing.. Energy Consultants Cornwall Insights estimate the typical cost for a family house to be £3244 after the October rise.
We made changes to our contracts to help protect you against the rising changes but due to the timing of these changes many of you will be facing utility overspends as your contracts were signed before the scale of the utility cap increases were readily apparent. This is beyond the landlord’s control.
What this means for you
You may be asked to contribute to an overspend during your tenancy due to this additional cost. This is because the landlords will – in most cases – see a massive increase in the charge they are paying for utility use.
We recommend you take monthly meter reads (start of each month) and give them to us so we can feed back to the landlord and get updated bills. If there is high usage then you should be able to find out about it on a more regular basis and plan accordingly, including adjusting your usage where possible.
You may have noticed that there has been a cost of living allowance announced by the government, of £400 towards utility bills. If there is an overspend it would be reasonable to factor in (e.g., deduct from an overspend charge) any credits received via this scheme.
We anticipate more landlords than usual will contact us regarding overspends as the proportion of utility bills to the actual rent received will be increasing dramatically. We will be advising all landlords accordingly to find the best path for both parties.
It is also important that you do not go cold, or allow the property to remain excessively cold (this just causes damp and makes any heating even harder). It is important to ensure electricity usage is not excessive – for example ensuring laptops and desktop PCs are fully shut down when not in use and not to use any additional sources of heating. All houses should have thermostats that allow for a heating routine to be implemented so the heating is not on 24/7. Turning off the heating when you do not need it is also important as is not turning it up to maximum constantly – one degree in additional heating costs approximately 10% more in gas cost.
There is good information at the link below on saving energy:
Link to Energy Saving Trust help page
If you still have concerns over the utility overspends we recommend you speak to Liverpool Student Homes. They have already contacted all registered agents and landlords with recommendations, which we have taken on board.
The Topproperty Team