British Gas dumps early cancellation fees - so long as you don't leave
British Gas has moved to scrap early cancellation fees for customers switching to other tariffs from the energy giant.
British Gas has removed cancellation fees for existing customers who want to switch to a different British Gas deal.
From now on, users on any British Gas tariff - whether new or existing, fixed or variable - can switch without penalty to tariffs that better suit their needs. Cancellation fees have been removed from existing tariffs that are no longer available, as well as new tariffs that are currently available to buy. Also, no cancellation fees will apply to any new tariffs launched.
A bonus for 12 million homes
British Gas is the UK's leading energy supplier, serving around 12 million homes, or almost half of British households. So millions of its customers - both present and future - will benefit from this decision to scrap early-exit fees.
What's more British Gas is the only UK energy supplier to contact customers every six months with a personalised 'Tariff Check'. This sets out various ways to save money by lowering energy bills, including moving to a different tariff if this is cheaper.
Then again, cancellation fees will still apply on fixed tariffs for customers switching to other suppliers, as British Gas doesn't want to lose out when these users jump ship.
Cancellation fees charged by other suppliers
British Gas is the biggest of the UK's 'big six' energy suppliers. The other five are EDF, E.ON, npower, SSE and ScottishPower. Let's find out what these other major suppliers charge when users end contracts early:
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Energy supplier |
Cancellation fee |
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EDF charges an 'Early Termination Fee' if customers end some fixed-rate tariffs early. For example, for its 'Fix to June 2014' tariff, this penalty is either £15 or £35 per fuel, depending on timing. |
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E.ON charges a cancellation fee for exiting fixed-rate tariffs early. This is either £5 or £10 per fuel supplied. |
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npower charges a cancellation fee on some fixed-rate tariffs. For example, this penalty is £50 per fuel for its 'Price Fix December 2015' tariff and £30 per fuel for its 'Energy Online October 2014' tariff. |
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On its '1 Yr Fixed Price Plan' tariff, SSE charges a cancellation fee of £50 if users cancel more than 49 days before the end of the 12-month period. |
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ScottishPower charges a cancellation fee of £25 per fuel on these three tariffs: 'Platinum Fixed Energy October 2015', 'Online Energy Saver 23' and 'Unifi Fixed Energy November 2014'. |
As you can see, cancellation fees across these five major suppliers vary from as little as £5 at E.ON to as much as £50 at npower and SSE.
Then again, even the highest of these cancellation charges -- £100 for dual-fuel contracts -- shouldn't necessarily deter you from switching suppliers, as the projected savings can exceed £300 a year or more. So even if your existing energy supplier does charge an early-exit charge, this should not put you off grabbing the super savings to be had from switching tariffs and suppliers. Just make sure you do your sums first!
To see which energy tariffs are available in your area, why not use the Lovemoney gas and electricity comparison tool?
More on gas and electricity:
British Gas considers free electricity on Saturdays offer
Standing charges: what does your energy supplier charge?
How to get your boiler repaired or replaced for free
Five reasons energy bills will go up imminently
Energy tariffs to avoid!
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Comments
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As I am with British Gas I checked my tariff and how it might be reduced (given that I am a pensioner) - they kept me held on the phone at my cost talking for nearly half an hour and then told me that on the new tarrif I would have to alter quite a lot of my contract conditions to my detriment and that I would save the princely sum of 10p (the phone call will have cost me much more than this) !!! When they have all brought out their winter rates I will look at swopping.
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Well, i supose its good news but I wonder how many of its 12 million customers will actually benefit from this move. Given that something around 70% have never switched suppliers, I'd be surprised if more than 2 or 3% actually benefitted. But it would be churlish to condemn the move, which will be beneficial in a limited way to BG , helping them to retain customers. Discounts to new customers (through comparison site rebates)probably cost them more than the income forgone from exit fees.
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14 August 2013