Big Six energy firms charging £329 more than cheapest tariff, says Which?

Big Six standard tariff rip-off worsens as two-year probe into the energy market draws to a close.

The gap between the cost of an average standard dual fuel tariff from a Big Six supplier and the cheapest deal has jumped 81% in the last two years, according to new research from Which?

The Competition and Markets Authority (CMA) has been investigating pricing and the low levels of switching in the sector since June 2014 and is due to deliver its final recommendations to improve the market later this month.

But campaign group Which? has found that, during those two years, households on standard deals have been losing out.

The difference between the average standard gas and electricity tariff from the Big Six suppliers – which includes British Gas, SSE, npower, EDF, E.ON and Scottish Power – and the cheapest dual fuel deal available has increased from £182 to £329 since 2014.

Make sure you aren't overpaying: compare energy deals now

At one point during its research in February 2016, Which? found that people on standard tariffs could save £400 a year by switching away from the Big Six suppliers to the cheapest tariff.

A standard tariff is what you are moved onto once your energy deal comes to an end, but these tend to be very expensive. Millions are thought to be on these tariffs with the Big Six and paying much more than they need to.

Switching too low

Despite the clear saving to be had by moving tariffs, Which? analysis shows switching levels are still low.

It found there has only been a 1.6% increase in the proportion of electricity and 2% increase of gas switchers over the last two years.

One of the major barriers to switching is the process itself. Generally, it can take four to six weeks. However, providers that have signed up to the Energy Switch Guarantee now promise to move your energy account in 21 days.

Around 70% of the energy market have signed up to the guarantee so far but 90% of the market is expected to be involved by October 2016. Read more in: Energy Switch Guarantee: change suppliers in just 21 days.

The energy market probe

Which? is concerned that the CMA’s final recommendations into changing the energy market won’t go far enough to improve things for customers.

So it’s calling on the regulator to outline how it will evaluate the success of its proposals, including specifically how it will deliver better outcomes for vulnerable customers that have never switched and are overpaying by hundreds of pounds.

It’s also calling for the CMA to commit to holding a review after two years to see whether the energy market has improved.

Alex Neill, Which? Director of Policy and Campaigns, said: “It is right that the energy market has been investigated, but during this time prices have continued to soar. If consumer trust is to be restored in this market then the CMA proposals must bring about real change in the energy market to benefit consumers who have been paying over the odds for gas and electricity.

“The regulator must set out how it will measure the success of its reforms and ensure they will be effectively reviewed, so that action can be taken if competition and consumer outcomes don’t improve.”

How to get a better deal

If you are on a rubbish energy deal you should switch. The best deals are charging from £751 a year!

You can compare deals using the loveMONEY comparison centre. But below we've picked out the 10 cheapest deals available right now.

* Prices based on average consumption as measured by Ofgem of 12,500kWh of gas and 3,100kWh of electricity and a customer paying by monthly direct debit including VAT.

Compare energy deals with loveMONEY

Read these next:

Extra Energy tops UK energy supplier complaints list

Call to curb National Grid's profits to bring down household energy bills

How to reclaim money from energy firms