How switching power deals now costs more than if you just rolled onto your provider’s default tariff
Households are being charged hundreds of pounds more for switching energy deals than if they did nothing and rolled on to their provider’s default tariff.
A handful of suppliers are currently advertising fixed gas and electricity deals for around £2,000 a year, based on a family’s standard usage, after wholesale prices soared.
The surge has prompted suppliers to hike household prices by as much as £470 in a day with the most expensive edging towards £2,000.
Price hikes: A handful of suppliers are currently advertising fixed gas and electricity deals for around £2,000 a year
And, with millions of households worried about soaring bills, experts have branded the eye-watering tariffs ‘highly questionable’.
Dozens of firms could still go under after another 800,000 families lost their supplier last week when Green and Avro ceased trading.
Under regulator Ofgem’s rules, suppliers must offer at least one deal that does not breach its price cap, which will rise from £1,138 to £1,277 on Friday.
These standard variable tariffs are what customers are moved onto when their company goes bust or a fixed deal comes to an end.
But while these have long been the most expensive tariffs, they are now among the cheapest.
Outfox The Market is offering the most expensive one-year fix on the market at £1,957 for the average household, according to The Energy Shop.
The Fix’d 21 23.0 was launched last week, replacing a cheaper one-year deal which was priced at £1,640.
Meanwhile, Ovo hiked the price of its 12-month tariff by a third — the Better Smart 17 September 2021 now stands at £1,864.
However, Bristol Energy’s tariff has the starkest price difference. The BE Simply Green September 22, Issue 23, now costs the average family £1,927 — £1,005 up on Bristol’s 12-month deal this time last year.
Scott Byrom, of The Energy Shop, says: ‘To see energy tariffs launch with average yearly bills of nearly £2,000, when a year ago the cheapest deals were around £842, is at best a terrifying reality check as to just how disconnected the price cap is, compared to where energy prices could or should be.
And at worst it is questionable as to why, at up to £680 more than the cheapest deals, energy suppliers are even choosing to launch them in the first place.’
Bristol Energy said: ‘The cost of a fixed price tariff is six times higher for us this year compared to last, but the margin we make is exactly the same as last year.’
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