Well, energy customers in the UK have become too smart. They do not fall into the traps put by the energy suppliers and their complex plans. They make big savings by simply switching to another cheaper supplier of gas and electricity. As per statistics from the energy regulator Ofgem, nearly 3.8 million people switched to other energy suppliers in the first half of 2016.
The reason for this whopping number of switchers is extreme competition in the energy market. Small and independent suppliers are offering energy plans at affordable prices. Cheaper rates along with good service makes it an attractive deal for people tired of the complex plans of big energy suppliers. Also, the domination of the Big Six energy suppliers has reduced due to their high tariffs.
Image Source: Ofgem
As per the Competition and Market Authority’s report, around two-third of UK people are spending more on their energy bills. Echoing CMA’s voice, Ofgem claimed that on an average an energy customer can save £300 by switching from a standard variable tariff to a more affordable plan which could be a fixed term tariff or some other attractive energy plan.
Ofgem reported that as of 28th July, the standard variable tariff of big energy suppliers would cost a customer around £1,066. On the contrary, the cheapest deal offered was a one year fixed tariff, which would cost £758. There was a huge difference between the two and switching from variable to fixed tariff would save £308 per year. This is a big amount and must be saved to use for other amenities.
To save customers from over spending, Ofgem has decided to try to display more prompters on the energy bills. This will help customers make a comparison between various tariffs and help to find the plan that could lead to bigger savings. The energy regulator mentioned that it will not cap standard variable tariffs. This way, the CMA report and Ofgem hint that it is always advisable to switch to an affordable supplier and tariff.
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