Most people don’t know that energy suppliers charge different rates in different regions, even though they offer the same service. While there is nothing you can do about the regional variations, you can choose the supplier that offers the best deal in your region.
The Office of Gas and Electricity Markets (Ofgem) limits how much providers can charge on a unit. The price cap changes twice a year, which means you might be paying higher rates now.
If you’ve found an energy supplier than can provide you with a similar service with a much lower rate, then it’s highly recommended that you get their service instead. Fortunately, the whole switching process is simple and quick.
Read on to know more about the best energy suppliers in the UK you can check out today.
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How much can you save by switching?
Most energy providers place their customers on a standard variable rate tariff (SVT), which is a default system that charges the highest rates.
One major issue with the SVT system is that the rates are linked with market activity. This means that you pay higher bills when prices in the market go up, even when there is no change to the amount of energy you consume. In fact, energy regulator Ofgem revealed that 57% of households are overpaying their energy bills by more than £300 a year.
Experts indicate that one of the reasons that most people don’t switch energy providers is because they don’t believe the savings can be achieved. Many of the cheapest providers are probably not popular, but they still offer reliable services.
Since the rates are changed regularly, it is important to check frequently to make sure that you are paying a reasonable price. Unless you are a loyal customer, there is nothing that should stop you from switching your energy provider if you get a better deal elsewhere. The best way to make sure you are paying a reasonable price for your energy bills is to run an energy price comparison.
Table of top suppliers in the UK
|Energy Company||% Share||Customers|
|Telecom Utility Warehouse||2%||540,000|
|Green Star Energy||1%||270,000|
How to compare cheap energy suppliers
Knowing how to compare prices charged by energy suppliers will enable you to get lower rates. There are a lot of things involved in comparing energy prices than just relying on third-parties. By understanding the types of contracts available and the factors that affect the prices, you will be able to negotiate better.
The first hurdle that most people face when finding the best energy deal is choosing the contract type that meets their needs. Since there are several contract options available, it is important to know what they are and how they work.
Below are some of the energy contracts available.
1. Fixed-rate contract
In a fixed-rate energy contract, the unit rate and the standing charge remain the same during the life of a contract. In most cases, fixed rates come on a 1-3 year contract basis, though some may extend up to 5 years. Usually, the longer the contract period, the more the charges. Also, it does not mean there is better protection against the future price increase.
A fixed-rate contract is a good option for people looking for a cost-effective energy rate. It is important to note that the ‘fixed’ is only associated with the unit rate and standing charges and not the cost of energy use. This means that the more energy you consume the higher the bills will be. While some providers are involved with all billing elements, others include third-party charges such as the metering fee which can increase your bill. It is always essential to read the contract carefully and thoroughly before signing.
2. Pass-through rate contract
In this type of contract, the kilowatt-hour unit rate is influenced by several factors that include market activities and the wholesale energy cost. This means you could be paying more or less throughout the life of the contract, even when you consume the same energy.
The most significant benefit of this type of contract is that you can make substantial savings when wholesale energy prices drop during the period of the contract. Those in the fixed-rate contract do not get such benefits. On the downside, it could go the other way where the wholesale price goes up, in which case you get higher bills.
3. Time of use contract
Even though this type of contract is not as common as the other two, it is worth understanding it. In this contract, the unit rate per kilowatt-hour changes based on the time of the day. This means that you will save money if most energy consumption happens during off-peak hours.
This is can be an ideal option for people with specific energy needs. However, you may receive higher bills if you consume more energy outside the stated period. In this case, it is advisable to use a smart meter device to be on the safe side.
When looking to secure the best possible energy deal, most comparison sites will only get you so far. Although they offer a great point of reference for potential energy costs, they only provide indicative quotes that might not accurately reflect the precise price you should pay. So, to get the most competitive deals, you have to do more research.
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Can I make savings as a renter?
When renting a property, the landlord should make clear what specific utilities you have to pay. If it is your responsibility to cater to gas and electricity bills, you can switch to a provider that offers a better deal.
Right now, there are numerous energy providers in the UK with varied tariffs and rates for both electricity and gas. Even if the landlord has a preferred supplier indicated in the rental agreement, you are entitled to change the supplier. However, it is always good to discuss this with your landlord.
Keeping track of the most affordable energy supplier in the UK is a challenging task. When you think you are getting the best deals, another company emerges at a cheaper rate. The best way to get a good deal is by comparing the prices in the market.
Why should I change my energy supplier?
The primary motivation to switch energy providers is to get the best deal for your energy needs. You will be surprised by how much you can save by just switching providers. Apart from saving, you can switch to get better customer support. The primary motivation to switch energy providers is to get the best deal for your energy needs. You will be surprised by how much you can save by just switching providers. Apart from saving, you can switch to get better customer support.
How do I switch energy supplier?
Switching from one energy provider to the other is very simple. Currently, there are numerous energy comparison sites that will help you know what you should pay per energy supplier. The sites will also give you a list of alternative tariffs you should choose from.
Who is the cheapest energy supplier in the UK?
There is no precise answer to this question. In most cases, it depends on where you live in the UK and the amount of energy you consume. There are over 70 energy suppliers, which is why comparison sites are essential.
Is there a penalty to switch from one energy provider to the other?
One of the main reasons that prevent most people from switching their energy providers is the penalties involved. Check the details of your current agreement with your supplier to see whether you will incur any charges if you switch. Some suppliers charge up to £30 for leaving the contract early.
Is it possible to switch energy suppliers if I rent?
This will mainly depend on the tenancy agreement. In most cases, you will be responsible for sorting out the utility bills, including gas and electricity. This means that you can switch the energy provider if you feel you are not getting a good deal.