Best energy deals: How to switch supplier and find cheap deals

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As the colder weather draws in, and the heating goes on, now’s the time to make sure you are not paying over the odds for your gas and electricity.

To boot, typically the end of January sees many of the previous year’s fixed-rate deals come to an end. 

Those who fail to switch are automatically moved onto their provider’s more expensive deal, adding hundreds of pounds to annual bills.

But moving suppliers doesn’t have to be a hassle. Below we explain how to search for the right deal for you, which providers offer the cheapest rates and what switching involves.

If you’ve never switched supplier, you could save a lot of money by moving to a different firm

Golden rule – ditch the standard variable rate tariff

Standard variable rate tariffs (SVT) are the out of contract deals your energy provider will move you to once your fixed deal ends.

People who have been on an SVT for the last 12 months instead of switching to a cheap fixed deal could have over-paid by around £325 on average, according to uSwitch. 

Plus these are the tariffs which energy suppliers can hike costs on. 

The Big Six’s grip on the energy market is slowly beginning to loosen as more and more households ditch them for smaller suppliers.

These energy minnows now dominate the best-buy tables as well as often offering better service.  

And you might be surprised by how simple the switching process can actually be.

Those on the hunt for a better deal have heaps of choice – whether it is a long-term fix, variable rate or tariff from a smaller or green supplier you are looking for.

Although the savings from switching are not quite as big as they were a few years ago, switching should remain a key part of your personal finance maintenance.

If you are one of the millions of people who have NEVER switched (i.e. stuck with your original supplier), then you could also save a big chunk of cash.

If you want to cut straight to comparison, you can compare energy tariffs, with the choice of entering your own energy use, using our energy comparison service provided by Compare the Market. 

How to save on energy bills now

Millions of people are needlessly overpaying for their energy as providers hike prices for existing customers and save the best deals for those who switch. 

But you don’t have to and it’s easier than you might think to fight back to beat the loyalty penalty.

With our new partner, Compare the Market, you can compare energy and exclusive deals and get rewarded with Meerkat Meals and Meerkat Movies* when you buy a qualifying product through them. 

You could save hundreds of pounds a year on your energy. 

>> Check to see if you can start saving money now 

*Meerkat Meals and Meerkat Movies are available with qualifying purchases. T’s and C’s apply. 

Things to remember 

Your bill will show two costs – a fixed standing rate charge and the price per unit (or Kwh of energy used).

Online plans paid by direct debit are still the most competitively priced and if you have never switched, choosing one of these will save you the most money.

You can either opt for a variable rate tariff, where the price can go up or down or a fixed rate tariff which gives you a secure price on each unit of electricity you use for a set period.

Savings: tricks and traps 

1) Regular meter readings: Make sure you check every time you receive a bill, rather than relying on an estimate by your energy provider’s estimate.

2) Change to online bills: You could save up to 10 per cent.

3) Avoid prepayment meters if you can, and swap to a billed meter. Even if you have to pay to get one, it’s probably worth it for the savings you’ll gain.

4) If you’re in financial trouble some companies offer special deals, which help ease any difficulties you might be facing. But don’t just assume this will be the cheapest option – make sure you still do your homework.

5) Dual fuel (gas and electricity from the same supplier) is not always the cheapest option.

6) Monthly direct debit payments could save you 5 to 10 per cent as companies are more confident that customers won’t default and earn interest on any over payments. Check any extra payments are refunded at the end of the year.

7) Swot up on how to lower your energy use: This guide gives you a few top tips to help you save more money by cutting your gas and electricity use

Should you fix?

If you are thinking of switching it could be worth considering a fixed tariff to help shield you from price hikes – including the Ofgem price cap that currently sits at £1,179. 

Tariffs of this type will fix the rate you pay for each unit of electricity used for a period, typically 12 to 18 months. 

The government initially introduced the price cap to encourage people to switch from SVT’s with Ofgem suggesting fixed tariffs are likely to be better value. 

However, you could pay slightly more than the cheapest deals to buy long-term security – and be careful as some do come with exit fees if you do want to leave early.

The cap will be reviewed every six months and altered in April and October. 

Remember: This doesn’t mean you will simply pay a fixed amount. Your bill will still depend on the amount of energy used – you just pay a certain amount per unit.

Price comparison services, like the one here at This is Money, allow you to specify which type of tariff you want.

Who is cheapest?

The table below lays out the top tariffs.

Bill sizes are based on the average medium user – remember the cheapest tariffs can be variable rates, leaving you open to price increases. 

But fixed deals currently dominate the best buys, and you could get an average bill below £1,000.

BEST BUY ENERGY TARIFFS 
Supplier Plan name Tariff type End date Green? Exit fee? (£) Average price (£)
Utility Point Just Up 20 Wk04 Direct fixed 12m N 72 818
People’s Energy People’s Energy 2 Months Upfront Winter 20 Tariff fixed 12m Y 60 828
Outfox the Market Fix’D 20 2.0 fixed 12m Y 0 829
Gulf Gas and Power Gulf Home Renewable 12 February 21 v1 fixed 28/02/2021 Y 60 831
Avro Energy Simple and SuperFlow fixed 12m N 0 835
Entice Energy Direct Only v2 fixed 12m N 60 865
Green Oak variable Y 0 867
Yorkshire Energy Green Yorkshire – Fixed until 30th September 2021 fixed 30/09/2021 Y 60 871
Green Network Energy GNE Snow Surprise V2 fixed 12m N 50 873
Tonik Energy Go Green Exclusive v3 fixed 12m Y 0 880
Source: uSwitch (correct as of 22 January 2020)           

What about green energy deals?

Switching to green energy doesn’t have to cost the earth. 

A growing number of suppliers are now offering deals that will replace the same amount of electricity you take from the grid, with electricity from renewable sources. A smaller number are also offering green gas. 

The increase in competition means prices for green tariffs are now far more affordable than they once were. 

If you are considering switching, make sure you check what percentage of green energy the supplier will match, before you sign up though. Some tariffs call themselves green, but only match a small percentage of your use. 

Here are the top deals available at the moment.

BEST BUY GREEN TARIFFS
Supplier Plan name Tariff type End date Exit fee? (£) Average price (£)
People’s Energy People’s Energy 2 Months Upfront Winter 20 Tariff fixed 12m 60 828
Outfox the Market Fix’D 20 2.0 fixed 12m 0 829
Gulf Gas and Power Gulf Home Renewable 12 February 21 v1 fixed 28/02/2021 60 831
Green Oak variable 0 867
Yorkshire Energy Green Yorkshire – Fixed until 30th September 2021 fixed 30/09/2021 60 871
Tonik Energy Go Green Exclusive v3 fixed 12m 0 880
So Energy So Alder – Green fixed 12m 10 882
Octopus Energy uSwitch Octopus 12M Fixed fixed 12m 0 884
npower Select npower Select uSwitch Exclusive v35 fixed 12m 60 884
British Gas Energy Plus Protection Feb 2021v3 fixed 28/02/2021 60 885
E.ON Fix Online Exclusive v23 fixed 12m 60 889
Source: uSwitch (correct as of 22 January 2020)         

Energy switching: The background

Suppliers tend to charge more for electricity to those customers who live in their ‘home’ region – the areas where they enjoyed a monopoly before energy deregulation. So switching away will almost always save you money. 

Prices are different all over the country and the cheapest supplier for you will depend where you live. You only need to be interested in the tariff that is going to be cheapest where you live, so do your own comparison to find the best price.

However, although some tariffs incur cancellation penalties if you leave before the term expires, it may still make sense to switch now and accept the penalty as it is likely to be small and your potential savings are big.

How to switch your gas and electricity

Switching your energy bills can save households an average of £283 each, according to uSwitch. 

The simplest and often best way to switch energy bills is to use an online service, which can compare the tariffs on offer for you.

One way of doing that to find the cheapest energy supplier for you is by using This is Money’s fuel bills switching service, powered by Compare the Market.

We have chosen Compare the Market as our partner because they are a long-standing, well respected firm with evidence to show that they can get our readers the best deal.

The service shows you the tariffs available and how much you could save by switching to each one, it allows you to choose what suits you and can rank suppliers by customer service and price.

Switching is quick and easy and can be done online. All you need to do is put your postcode into the box to the right and follow the simple steps. The service is free to use and in a few minutes can tell you whether you can save hundreds of pounds.

There’s no need to fill out any paperwork or sign a new contract – it does the hard work for you.

How to cut your energy bills now 

While switching is the main way to cut your energy costs, there are other things you can do to cut your costs quickly. Here we’ve listed five of the easiest ways to cut your energy bills.

1. If you’re in credit to your supplier you can ask for the money back. Households paying via direct debit pay a set amount each month for their gas and electricity. 

But for some months of the year – usually when it’s warmer so during summer and spring – your energy account will be in credit. This is your money and it is possible, if you want the cash and the interest, to contact your supplier and ask for this to be transferred to you.

2. Cut your energy usage. It sounds simple enough but if you change the way you’re using your gas and electricity, and if you’re able to reduce your usage, your bills will go down.

Small changes can make quite a big difference. If you turn your main central heating thermostat down by 1˚C, for example, you could typically save around £85 to £90 a year – if you live in a typical three-bedroom semi-detached house with gas central heating.

3. Paying via direct debit and using an online account could cut £10 or more off your annual bills. If you’re able to pay your energy bills via direct debit, so one fixed payment is made per month, this could be cheaper than other methods. 

Having an online account, and choosing paperless billing, can also cut your bills, often by around £10 to 20 per year.

4. You can still save money even if you don’t switch suppliers. While typically the biggest savings are still to be had by switching providers, if your current supplier is offering a cheaper tariff than the one you’re currently on, you could switch to it and cut your bills. 

To find out if you could save, contact your supplier and ask if what the cheapest tariff available is, if it’s less than your current deal then ask it if you can switch.

 

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