Compare Energy Prices and Save up to £318* by Switching!

Energy prices have been a hot topic for many of us. After a big surge that started in September 2021 and hit its highest point in January 2023, prices have slowly been coming down. However, they’re still higher than what we were used to before the crisis. Here’s why energy bills are still a bit on the high side:

• Wholesale Gas Prices: While gas prices have come down from their peak, they’re still higher than they were before. Global issues, such as supply chain disruptions and past conflicts in energy-rich regions, still play a role in keeping prices unstable.
• Energy Price Cap: Ofgem, the energy regulator, sets a limit on how much suppliers can charge for standard energy tariffs. This “energy price cap” is reviewed regularly, and even though wholesale prices are coming down, the cap is still higher than it was before, which means bills haven’t dropped as much as we’d like.
• Limited Supply of Fossil Fuels: Much of our electricity and heating comes from gas, which is still a limited resource. Although there’s a big push towards renewable energy, this transition takes time, and until then, we’re still feeling the effects of relying on fossil fuels.
• UK Energy Providers: Some people think energy companies should lower prices more, but Ofgem’s role is to make sure there’s a fair and competitive market for everyone. Energy providers also face higher costs themselves, which affects what they can charge.

Even though energy prices remain higher than we’d prefer, there are still ways to take control of your bills. Comparing energy deals and switching to more affordable providers can help you find the best option for your home.

The UK energy market remains dynamic and subject to various factors that influence price changes. Recent updates from Ofgem, the UK's energy regulator, show some fluctuations in the energy price cap. Here's an overview of recent and projected energy price caps:

• From July 1 to September 30, 2024, the energy price cap was set at £1,568 per year for a typical dual-fuel household paying by direct debit.
• From October 1 to December 31, 2024, the energy price cap has increased to £1,834 per year for a typical dual-fuel household paying by direct debit.
• Projections for January 1 to March 31, 2025, suggest a further rise, potentially reaching £1,924 per year.

These figures are based on average household energy consumption and are subject to change. The price cap is influenced by wholesale costs, network costs, operating costs, and other factors such as VAT and environmental obligations.

While the current trend shows some increases, it's important to note that the energy market can be unpredictable. Experts suggest that higher energy prices might persist due to ongoing market turbulence and global energy supply challenges. However, the Ofgem energy price cap continues to offer protection against excessive charges.

Consumers can potentially reduce their energy costs by comparing prices and switching suppliers, as well as using less energy and improving home energy efficiency. We recommend using our quick and easy price comparison tool to see if you could save money by switching to a better deal.

Comparing energy prices is essential for finding the best deals and saving money on your gas and electricity bills. By following these steps, you can navigate the energy market and make informed decisions:

1. Start with an Energy Comparison

Begin your energy comparison journey by using a reliable platform like Free Price Compare. Their user-friendly interface allows you to enter your postcode, current supplier, and energy usage details to generate a list of available deals in your area.

2. Consider Fixed and Variable Tariffs

When comparing energy prices, you'll come across fixed and variable tariffs. Fixed tariffs offer a set price for a specific duration, providing stability and protection against price hikes. Picking a fixed-price tariff means the rate you pay for your gas and electricity remain the same until the end of the fixed period. Variable tariffs can fluctuate with market conditions but may offer more flexibility. Consider your preferences and energy usage to determine which tariff suits you best.

3. Analyse Contract Terms and Additional Benefits

Look beyond the price when comparing energy deals. Consider contract terms, such as contract length and exit fees, to ensure they align with your needs. Additionally, explore any additional benefits offered by suppliers, such as renewable energy options or customer rewards programs.

4. Check Customer Reviews and Rating

Customer reviews and ratings can provide valuable insights into the quality of service offered by energy suppliers. Consider the experiences of other customers to gauge the reliability and customer satisfaction levels of different providers.

5. Switch with Ease

Once you've found a suitable energy deal, Free Price Compare can assist you in switching seamlessly. They handle the entire process, including contacting your current and new suppliers, ensuring a hassle-free transition.

• Dual fuel tariff- If you take out a gas and electricity contract from the same energy supplier under one contract then that would be classed as a dual fuel tariff contract. You’ll get one bill for your gas and electricity. Some suppliers may offer further discounts if you take out a dual fuel contract with them.
• Single fuel tariff- It means, you are agreeing to two separate tariffs for your gas and electricity with the same or different supplier. You’ll get a separate bill for your gas and electricity during the length of your energy contract.

When switching, you can simply check if dual fuel tariff will be cheaper compared to single fuel by using the available filters on our table.

There are 2 different types of energy tariffs to consider when looking to switch your energy supply.

1 - Fixed rate energy tariff

If you agree to a fixed rate contract with a supplier, your gas and electricity prices will remain fixed for the duration of your contract. You can fix your energy from a 1 to 5-year contract with a supplier of your choice. Fixed term contract offerings will vary per supplier, it is more common to see contract lengths between 12 and 24 months.

It is important to remember that your unit rate and standing charges are fixed but your monthly bill can vary depending on your energy consumption. If you use more electricity and gas then you are likely to get higher bills.

A fixed term contract is ideal for those who want to keep track of their energy usage and spending habits. While you are in a contract, you are protected from any energy price rises which means wholesale energy price rises will not affect you during your contract.

Most energy suppliers will offer a fixed-term contract but these usually come with an exit fee. If you terminate your contract before your renewal window then your supplier will charge you a set fee which is usually agreed upon while taking out a contract. Exit fees can vary per supplier and the provider can charge up to £125 per fuel. Once your fixed-term contract has ended, your supplier will roll you over to a standard variable rate which means traditionally, you are paying a higher rate for both the daily charge and the unit rate compared to your contracted rate. By law, you can also switch your energy supplier 49 days prior to your current contract end date without being charged any exit fees, this is also known as the “renewal window”. But some energy providers will offer to pay your exit fees if you join them - it's worth checking.

2 - Variable rate energy tariff

Variable rate tariffs are usually a cheaper option to start with but it can be very expensive if the wholesale market prices go up. Your unit rate and standing charges are not fixed and therefore can vary depending on the wholesale energy market, meaning your price could go up or down.

If you have moved into a new property and have not agreed to an energy contract then you are going to be on a standard variable tariff with the previous occupier’s provider. Also, if your current energy contract has ended and you have failed to switch to a new contract with the same or a new supplier then you are going to be moved to a standard variable tariff.

The main advantage of having a standard variable tariff is that you are free to switch away from your supplier at any time without being charged an exit fee.

If you are on a standard variable rate contract, you are more likely to save hundreds of pounds by switching to a fixed term contract if you are going to be in your property for a year or more.

• Standard credit meters - Credit meters are the traditional standard electricity and gas meters that most of the UK households still use. Standard credit meters need to be read by the supplier or yourself in order to get the correct energy bills. Your monthly energy bills will be estimated and adjusted accordingly when a meter reading is provided to your supplier.
• Smart meters - A new generation meter for your gas and electricity supply which are being rolled out by individual energy suppliers across the UK. These can record and report usages to your current supplier. Smart meters have a function to show you how much energy you are using in pounds and in kWh in real time.
• The government has recently engaged in discussions with suppliers and other industry stakeholders regarding its plan for 2024 and 2025. As a result of these consultations, the government has set targets for suppliers to install smart meters in a minimum of 74.5% of residential properties and approximately 69% of small businesses by the conclusion of 2025.
• Prepayment meters - Prepayment meters are also known as Pay As You Go meters. Most commonly found in rental properties and used by tenants. You have to top up an amount to your meter before using any energy, i.e. paying for your energy in advance. You can top up your prepayment meter by using a Key or card at your local shop or by using energy supplier mobile app. If your top up runs out, your energy will be cut off too.