Price

• Comparing prices

Price is often the most important factor in deciding which supplier to use. See Chapter 4 for the types of meters and payment methods available.

When considering what suppliers are offering, look at the following.

•Standing and unit charges – suppliers are currently only allowed to have one structure for tariffs: a unit rate (or unit rates for time of use tariffs) and a standing charge (which can be zero). Complex tiered tariffs are banned. A ‘standing charge’ is a fixed monthly/daily amount you pay the supplier for maintenance and other costs, such as maintaining the connection to the power network. ‘Unit charges’ are the monetary amount chargeable for each unit of electricity or gas consumed and may vary considerably between suppliers, payment methods or product types.
•Payment methods – be careful when looking at figures provided by suppliers. Some advertised savings are calculated based on you switching supplier and changing to a different method of payment – eg, from quarterly cash payments to monthly direct debit. You might get the same benefit that switching would give you with your existing supplier by switching to a different payment method. Any difference in charges for different payments must genuinely reflect the cost of the differences to the supplier.1Condition 27.2A SLC
•Penalty on default – suppliers do have the power to penalise customers who do not pay their bills by disconnecting them, but typically they attempt to switch customers to prepayment (see Chapter 8). If you have difficulty paying all your bills on time, avoid such terms if possible. See the section on unfair terms on here.
•Supplier flexibility – you might want to change your payment method or some other aspect of your supply. For example, if you are on a prepayment meter, your current supplier might not allow you to change to a credit meter, whereas a new supplier might be more flexible. Ask different suppliers for this information.

Some suppliers offer dual-fuel supply deals (see here) when you take both gas and electricity from them. Consider whether this would be the best for you. In particular, the convenience of a single supplier might outweigh any price disadvantages for some people.

When deciding whether to switch to a new fuel supplier, it is best to have all the information on prices, terms and conditions so you can compare them and find the deal that best suits you. All suppliers must publish their standard terms and conditions. Citizens Advice publishes the customer performance standards of energy suppliers which you should refer to before switching.2citizensadvice.org.uk/consumer/your-energy/get-a-better-energy-deal/compare-domestic-energy-suppliers-customer-service

Note that suppliers are not allowed to enter contracts through agents who require advance payments – you do not need an agent to get you a new contract and you should not use one.

 

Condition 27.2A SLC »

citizensadvice.org.uk/consumer/your-energy/get-a-better-energy-deal/compare-domestic-energy-suppliers-customer-service  »

Comparing prices

To make a meaningful price comparison, you need to collect information about your current supplier, payment method, annual usage and bills for the last 12 months, and then use the ‘ready reckoner’ comparison tables which provide a broad overview. Several services exist that allow you to compare prices.

The potential savings depend on where you live (as prices vary in different parts of the country), whether you want to switch gas or electricity supplier or both, the payment method and whether you have time of use or ‘off-peak’ tariffs. Not all suppliers operate in all parts of the country.

There are many websites that compare gas and electricity prices. It is not possible to compare all available tariffs on comparison websites, as some tariffs are unavailable online, such as dynamic teleswitched or various time of use tariffs. Note: the ‘radio teleswitch’, which affects customers with meters and tariffs dependent on this, is due to end by the end of June 2025, although this is likely to be extended due to the low rate of smart meter installations. Websites must state that they cannot compare all tariffs,1Ofgem, Decision on Implementing the CMA’s Recommendation to Remove the Whole of Market Requirement, July 2018 as they should be transparent about the market coverage they offer to energy customers. It is important to remember that there are more websites out there. Check that any website you use has the Ofgem Confidence Code logo. The Confidence Code sets out the minimum requirements that a provider of an internet domestic gas and electricity price comparison service (service provider) must meet to be, and remain, accredited by Ofgem. The prices quoted for energy deals on the accredited websites, and the information given about the offers, must be shown in a fair and unbiased way. For an up-to-date list, check Ofgem’s website.2ofgem.gov.uk/consumers/household-gas-and-electricity-guide/how-switch-energy-supplier-and-shop-better-deal/compare-gas-and-electricity-tariffs-ofgem-accredited-price-comparison-sites

The Confidence Code requires the service provider to be independent of any gas or electricity supplier. It must be a company which runs its own website and uses its own tariff database and calculating system, not merely hosting those of another service provider, and must try to include price comparisons for all available domestic tariffs. The service provider may take commission from energy suppliers, but this must not influence the information given.

Are there other issues to consider before switching supplier?

Although the price offered by a new supplier may suit you, the other terms and conditions may not so check them carefully (see here for other terms and conditions to consider).

Before switching supplier, consider the performance and complaint-handling record of the new company. Energy companies must publish regular, detailed complaints data in a common format so that companies can be compared.

You may be entitled to a Warm Home Discount (see here). Before switching, check that your new supplier offers the discount, and that you are eligible under its criteria.

 

1     Ofgem, Decision on Implementing the CMA’s Recommendation to Remove the Whole of Market Requirement, July 2018 »

2     ofgem.gov.uk/consumers/household-gas-and-electricity-guide/how-switch-energy-supplier-and-shop-better-deal/compare-gas-and-electricity-tariffs-ofgem-accredited-price-comparison-sites »