Small energy supplier price war could save you money

Updated: 

File photo dated 18/01/12 of a gas hob as more than half of UK adults say they will have to cut their spending to cope with rising household bills over the next year, Citizens Advice has warned. PRESS ASSOCIATION Photo. Issue date: Monday January 27, 2014. Three in five people (58%) are worried about the effect that higher bills will have on their finances and 53% - or 27 million - will have to cut spending to cope, according to a study by the consumer body. It is launching the Big Energy Saving Week today, backed by Government, charities and the energy industry, to help consumers take practical steps to make cuts to their bills. A survey found that of those who plan on cutting their spending, 59% say they will have to reduce the amount they spend on food, 37% will look for ways to reduce their energy bills, 8% will consider moving to a cheaper home and 66% say they will have less to spend on time out with family and friends. See PA story CONSUMER Bills. Photo credit should read: Yui Mok/PA Wire

As First Utility launches the cheapest energy tariff around, Matt Ridout asks whether we are seeing a price war among smaller suppliers?

Are we seeing the outbreak of a gas and electricity price war beginning between small suppliers? In the past two weeks both Ovo and First Utility have launched market-leading tariffs, both costing the average user under £1,000 a year.

Ovo was the first supplier to offer a sub-£1,000 deal last week, launching its new Cheaper Energy Fixed deal. The tariff sees dual fuel prices for a typical medium-usage household set at £998 a year with rates fixed for 12 months.

Yesterday, First Utility fired its response by launching the iSave Fixed v20 July 2015. This deal costs £994 for a typical medium-usage household annually and sees rates locked until the end of July 2015.

One of the newest suppliers on the market, Green Star Energy, has launched the cheapest two-year fixed deal, with its new No Worries 24 Months Fixed version 1404 Paperless tariff costing just £1,072 a year, with prices locked for a full two years.

The catch? All the tariffs incur cancellation fees should you want to switch away prior to the end of their fixed periods, with each one charging £30 per fuel should you want to take your business elsewhere. The best recommendation we can give is to compare your current supplier and tariff with all of the deals available on the market to see how much you could save.

Here are the cheapest deals around at the moment

Supplier

Tariff

Average Cost

Average Saving*

Fixed Period

First Utility

iSave `Fixed v20 July 2015

£994

£321

July 31, 2015

Ovo

Cheaper Energy Fixed

£998

£317

12 Months

Extra Energy

Fixed Price September 2015

£1,014

£301

September 30, 2015

Green Star Energy

No Worries 12 Months Fixed version 1404 paperless

£1,041

£274

12 Months

Ovo

Greener Energy Fixed (Online)

£1,054

£261

12 Months



* based on a typical dual fuel tariff costing £1,315 (SourceOfgem). All costs are for a yearly average usage dual fuel household paying by monthly direct debit. Average usage defined by Ofgem as 13,500 kWh p.a. of gas and 3,200 kWh p.a. of electricity.

Data correct as of 16/04/14

12 ways to save £10,000 in 2014

12 ways to save £10,000 in 2014