When it comes to energy suppliers, loyalty doesn’t pay
Customers who remain loyal to their gas and electricity providers pay up to £230 more than regular switchers
Research carried out by uSwitch found that the cheapest energy deals currently available are up to £232 cheaper per year, than the standard plans on offer through the big six – British Gas, EDF Energy, E.ON, npower, ScottishPower, SSE.
The average household which switches from a standard tariff from one of the big six, to one of the cheapest alternatives will save £180 per year.
Prior to 2012, when Ofgem began implementing a number of measures aimed at creating a fairer and simpler energy market, the difference between the average standard plan and the cheapest tariffs was £167.
Ofgem recently announced that 62% of Brits have never switched energy supplier.
‘Households are losing out more than they were before’
Speaking on the issue, Emma Bush, energy expert at uSwitch said: “The difference between the cheapest and standard plans of the big six can be a staggering £232 a year.
“Households are losing out more than they were before. Given that just 10% switched supplier in the past 12 months, millions of people could be sat unnecessarily on the most expensive tariff.”
Energy companies have justified charging customers on standard plans, who pay by cash or cheque, more than customers on online plans who pay by direct debit, because of cheaper processing fees. However, the Citizens Advice Bureau told this is Money that the practice makes it extremely uncomfortable.
‘Other industries […] reward their most loyal customers’
Caroline Flint, Labour’s shadow energy and climate change secretary, said: “It’s outrageous that energy companies are cashing in on their loyal customers.
“In other industries, companies have all kinds of schemes to reward their most loyal customers but in the energy market loyal customers pay most.”
She added that “suppliers are charging what they think they can get away with” and said the figures were evidence that the energy sector needs a new “tough” regulator.