If your bank balance is suffering the post-Christmas blues and you have not switched gas and electricity tariff recently, there is an easy £300-plus a year saving to be bagged … by switching supplier.
Despite the turmoil in the Middle East, a big drop in wholesale gas prices last year has resulted in a host of super-low tariffs – with the cheapest starting at £818 a year.
The small but established supplier Utility Point has shot to the top of the table with a host of dual-fuel (gas and electricity) tariffs costing less than £830 a year. If you are currently siting on your supplier’s most expensive standard tariff, you are paying £1,179 a year on average – or £350 a year more than the cheapest.
If you quite rightly insist on a green 100%-renewables electricity tariff, you will pay a bit more – £878 a year – with So Energy, a solid supplier with a reasonable track record that should save you about £300 a year.
Or, if you prefer to stick to a big name, E.ON’s fixed online exclusive v22 tariff also offers 100% green electricity, and is only a few pounds more. Given the high number of small companies that have collapsed recently, consumers may want to opt for a business they have heard of.
The market price for wholesale gas has plummeted across Europe as a record number of cargoes from the US, Russia and Qatar have flooded into the continent. In September, the market price for gas hit a 10-year low of 24.75p per therm, about half that of September 2018.
The result is that energy suppliers large and small have been “tripping over themselves” to offer new customers really low-cost switching deals, says Mark Todd, who runs the Energyhelpline.com switching site.
“Savings of £250-£300 are not uncommon even switching to large, reputable suppliers like E.ON’s cheapest deal in the market right now. This comes with 100% renewable electricity and a fixed price for 12 months,” he says.
“Going to smaller suppliers, savings of £350 a year can be found for a typical home, though the suppliers offering them can be rather unknown quantities; these deals are more for those who are happy to take a bigger saving for a larger service-quality risk.”
Utility Point is the first point of call for those buying on price alone. However, its cheapest deals do not offer 100% green electricity, and while it has a reasonable service rating, its website arguably is not as good as rivals. Crucially, they have been around for a while and do answer the phone – a rare thing among smaller suppliers.
Readers who want the very cheapest green deal should look at People’s Energy Company’s winter 19 tariff v2, although be aware it requires customers to pay two months upfront. It is too much of an unknown quantity for an unreserved recommendation here.
Sadly, 2019 was the year of failing energy companies. The regulator, Ofgem, has measures in place to protect customers if their supplier fails, however, plenty of Money readers reported big problems last year trying to resolve billing disputes, and getting balances owed after their supplier collapsed.
It all means switchers may want to stick to suppliers that have been in business for some time and have an established track record.
Joe Malinowski, the founder of TheEnergyShop.com, says the fact that the big five energy suppliers have been fighting back with cut-price fixed energy deals is “a great opportunity for consumers”.
He adds: “Seasonally, energy prices rise over the winter months, so now is a great time to lock in a low price in case they do.
“It is important to check the new supplier and avoid getting sucked into cut-price deals from small suppliers that ask for several payments in advance.”
* As ever, households should do an energy comparison to check the best deal in their area, for their consumption. Just remember to click on all available products – not just the deals that the site earns a commission for switching you to. You may want to stick to firms you have heard of or, at least, researched.
