E.ON has decreased its prices twice in 2020, to bring its tariffs in line with Ofgem's energy price cap
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In August 2020, E.ON announced it would be reducing the average cost of its standard variable tariffs by 7% in line with Ofgem's revised energy price cap.
The price of the supplier's standard variable tariff dropped by an average of £84, bringing the average customer's bill to £1,042. The price change came into effect in October 2020.
In February 2020, E.ON reduced the average price of its standard variable rate tariffs by £16 — about 1% – also due to a cut in the price cap level.
E.ON previously tracked the price cap rate by lowering the average price of its standard variable rate tariffs by £77 for around 1.8 million dual fuel customers, effective 1 October 2019.
The big six supplier also lowered its costs in reaction to the energy price cap decrease announced on 7 August 2019.
These price decreases followed months of price rises from E.ON:
- In August 2018, E.ON raised its prices by an average of 4.8%, around a £55 increase for dual fuel customers
- In April 2018, E.ON removed the discounts it offered some of its customers as well as increasing standing charges for those paying by cheque or cash quarterly.
How much will the E.ON price decrease save me?
If you're on E.ON's standard tariff, the latest price decrease could save you around £84 a year.
However, this price cut will not save you as much money as switching to a cheaper fixed energy tariff. At the time of the price change announcement, there was a more than £200 difference between the price cap level and the cheapest deals available on the market.
What can I do to save more money than I would by relying on the price cap?
Variable rate energy plan
Fixed rate energy plan
If you're on a variable rate plan with E.ON then your energy prices won't be as cheap as they could be, so it's a good idea to run an energy price comparison as soon as possible to find the best deal for you. And if you switch to a fixed rate plan you can protect yourself from any future price rises for the length of your deal.
Don't be complacent about your fixed rate energy plan - when your fixed term comes to an end, you'll be automatically placed onto a default tariff. This will make you vulnerable to any potential price rises. Make sure to compare the market regularly to see if you can get a better deal.
Why did E.ON lower its prices?
E.ON's latest price change came less than a week after Ofgem announced a decrease to the energy price cap.
When Ofgem announced a reduction to the energy price cap on 7 August 2020, E.ON reacted by lowering its prices to match the cap level. The new prices set by E.ON come in at an average of £1,042 for its dual fuel standard tariff.
The default cap tariff is a limit on the unit rate and standing charge that energy suppliers can charge for their standard variable (or default tariffs). While the price cap is a maximum limit rather than a recommeded average price, E.ON has priced very close to the cap level since it was brought into effect in January 2019.
Previous price changes from E.ON
Before the price cap was introduced, E.ON raised its prices twice in 2018. These price rises came into effect in August and April.
Prior to this, in March 2017, the supplier announced a price hike amidst a flurry of price rise announcements that followed a winter of price freezes from the big six.
E.ON's price rise of 9% - 4% for gas and an eye-watering 14% for electricity - made it number four of the big six to announce that, in March 2017 (past the promised months of frozen prices), it would be increasing prices for customers on variable rate energy plans.
All of the big six did eventually go on to raise their prices in 2017, with British Gas holding out until September 2017.
Which energy suppliers have changed their prices in 2020?
E.ON was the second of the big six energy suppliers to reduce its prices when the new cap level was announced in August 2020.
You can read about previous price changes from the rest of the big six below:
Will E.ON raise energy prices in 2020?
The energy price cap is reviewed twice per year, in February and August (to come into force in April and October). Because E.ON has priced its standard variable tariff to match the cap rate as of October, it's unlikely to change again in 2020.
Remember that fixed tariffs are likely to offer better value than a variable tariff. If you are on a standard variable tariff with E.ON then now is a good time to compare the energy market and run an energy price comparison and see how much you can save on your household bills in 2020.