Which energy tariffs are cheaper than Ofgem’s price cap?
The energy regulator announced in August that the price cap will fall from £1,126 to £1,042 a year, with an effective date of 1 October.
But research from MoneySupermarket found there are currently 67 tariffs cheaper than the new Ofgem price cap. The price comparison site said households who haven’t switched for a while could potentially save hundreds of pounds a year by switching.
The energy price cap places a limit on the maximum price for each unit of energy suppliers can charge domestic energy users.
For the average customer, Ofgem’s reduction means an annual bill will come down from £1,126 to £1,042 a year.
But MoneySupermarket says households shouldn’t rely on the price cap to lower their bills as switching can result in greater savings.
For example, one of the cheapest tariffs currently on the market – E.ON’s Fix Online Exclusive V50 – is £172 cheaper than the cap at £870 a year and comes with 100% renewable electricity as standard.
Stephen Murray, energy expert at MoneySupermarket, says: “Winter is very much around the corner and we’re expecting higher than normal energy usage this year with more of us working from home as a result of social distancing measures. As a result, if you haven’t switched your energy supplier for a while, you should consider it. This is especially the case if you’re on an expensive standard variable or default tariff as you’re likely to save money as a result.
“Ofgem signalled its intention to lower its price cap to from £1,126 to £1,042 in August, with the move effective from October. But relying on the price cap to reduce your bills could result in you missing out on hundreds of pounds of savings.
“Our research shows that there are currently 67 tariffs on the market that are cheaper than the price cap, and some of the best value could save you up to £200. So, if you’re in a position to do so, our strong recommendation is to shop around for a new deal. Switching supplier is easy – it only takes a few minutes online.”
Five of the best energy deals on MoneySupermarket are:
Just Up 20 Wk39 (only available in 13 regions)
Fixed tariff, average bill value of £869 a year
Fix 1 Year Exclusive September 2020 v2
Fixed tariff, average bill value of £870 a year
Energy January 2022
Fixed tariff, average bill value of £874 a year
Green Network Energy
GNE Summer Sizzler v9
Fixed tariff, average bill value of £876 a year
100% Green 12m Fixed Sep20 v1
Fixed tariff, average bill value of £883 a year