The price of the cheapest deals has risen sharply since October 2016, when the Tories first announced their plans to cap energy bills for those on standard deals.
One provider, SSE, raised its cheapest gas-and-electricity tariff by almost 40pc between October 2016 and May 2017 – or from £782 to £1,072, based on average household usage.
As disclosed by The Telegraph, the gap between the best deals and the standard tariffs has narrowed, even though providers have in many cases increased their standard tariff rates too.
The average “Big Six” cheapest deal is now just £137 less than the cost of a standard tariff compared with £226 in October.
Energy experts suggest that the implementation of the cap will further limit the benefits for those who shop around. So, for now, read on for the best available deals and advice on how to switch.
Scroll down for…
- Does it pay to switch?
- What to do right now
- Best fixed and variable deals
- Predictions: what next for prices?
Bookmark this page – updated regularly – to keep your bills low
LATEST: Energy prices are on the rise.
Over the past 12 months the cost of the cheapest fixed-rate tariff has increased from £745 a year (which was offered by SSE in April) to £879 (from Avro Energy) based on average usage.
At the same time the price of the best variable deal has risen even more. In spring GB Energy Supply customers could expect to pay £765 per annum – now the best tariff costs £888.
Most of the biggest energy suppliers have announced price hikes this year including SSE, npower and EON. See here for the full list.
- Compare energy tariffs across the market
Gas that will be delivered next year is being traded now. Prices change regularly and reflect expectations of supply meeting demand.
Does it pay to switch?
Avoid the traps by shopping around for a better contract. You will need to know the name of your current energy plan and an estimate of your usage.
If you haven’t kept your bills, or have recently moved and don’t have access to the previous occupant’s bills, you can ask for these details from your supplier.
Most variable tariffs will let you switch without a charge. But some fixed-rate deals and online-only offers might charge if you leave before the end of the term.
Even if you are locked into a fixed-rate tariff with an exit fee, you may be able to negotiate a better deal with your current supplier or elsewhere. Ring your supplier and ask whether it can make a counter offer. If not, check whether the saving from switching to a new supplier outweighs the costs.
Best fixed deals
The cheapest deals are currently fixed tariffs but even these are on the rise.
Back in April the cheapest fixed deal was £745 based on average usage. The average cost of the top 10 deals was £757.50. This crept up to £784 in September, according to MoneySupermarket, and is now £900.50.
Be wary of fixed deals that come with a costly exit fee, such as the £60 charged by a number of suppliers to customers who switch.
Ofgem says all suppliers must contact customers 42 – 49 days before their fixed tariff comes to an end. Once you have received the letter you are free to switch without penalty.
Even if you’re on the cheapest fixed deal be sure to switch when it comes to an end or risk being rolled onto your supplier’s standard variable fixed tariff
And for a gamble, the best variable prices
Fixed-rate prices are traditionally cheaper than variable tariffs but recently the gap has narrowed.
In theory you could take a gamble with a variable tariff and hope it could soon drop below the fixed deal costs. However, as the general sentiment is that prices are rising, it may not be the best time to take the chance.
If you’re already on a variable tariff remember suppliers must notify customers 30 days before a price rise, which means there is time to switch to a cheaper deal. Early exit fees do not apply to variable tariffs.
Advice for spring 2017: switch to a fix
Variable and fixed-rate tariffs are similarly priced but if you fix you’ll protect yourself against rises.
There are also some fixed deals, such as Avro Energy’s ‘Simple and Fix’ and Bristol Energy’s one-year fixed tariff that do not come with early exit fees, so customers can switch if something better comes along.
You may be able to make greater savings by reducing your power use, either through energy-saving appliances or smarter practices at home. Energy-saving goods may be cheaper to run, but can be costly to purchase and install. There is a risk that people who want to reduce their carbon footprint are falling for misleading claims.
• Five quick tricks saved this family £400 a year on bills
• Can I make more money by moving my solar panels?
The ‘big six’: recent ups and downs
There was little activity among suppliers until the start of 2016 when all of the big six announced reductions to the price of gas. The cuts were minimal at around 5pc.
E.On was the first to announce a 5.1pc price cut at the end of January, quickly followed by SSE. Scottish Power joined the price war on February 2 with a 5.4pc reduction. Days later NPower announced gas would be 5.2pc cheaper from March 28.
British Gas and EDF announced their cuts within hours of each other on February 11.
British Gas said it would lower the price of gas by 5.1pc from March 11. It estimated it would save its customers an average of £31 per year. EDF quickly followed and announced a 5pc cut to gas.
Last year, experts predicted energy bills would rise by 5pc in 2017 – but some providers have already pushed up prices by more than that.