SSE to cut gas prices by 4.5%

The company announce price reduction in response to falling wholesale gas costs, although no reduction in standing charge means it's actually 3.8%.

Following hot on the heels of British Gas and EDF price cuts, SSE has announced that it’s cutting gas prices by 4.5% from 26 March.

It says that will reduce the typical gas bill of its customers by around £28 a year. If you’re an M&S Energy customer, you’ll also benefit from the price drop. However, Consumer Focus says SSE is not applying the price cut to its standing charge - the daily charge customers have to pay to the supplier - so the real price cut is actually 3.8%.

SSE is also extending its cap on electricity and gas prices from August to October. The company says it won’t raise prices before October and will “implement more price reductions if it can”.

It says that it had bought much of its gas in advance but was able to pass on the drop in the wholesale price from more recent orders.

During the summer energy price rises, SSE increased gas prices for its customers by 18%.

SSE says it will publish a breakdown of all the costs that make up a customer’s bill on its website from 16 January. That breakdown will appear on all its customers’ bills later this year.

SSE came eighth in a Which? customer satisfaction survey of energy companies released yesterday.

Earlier today, British Gas announced that it was cutting electricity prices for most of its customers by 5%. Yesterday, EDF Energy revealed that it was cutting gas prices by 5% in response to the falling cost of wholesale gas.

The cheapest tariffs

With three of the Big Six still to potentially drop their prices, you might be thinking it's worth waiting to see what happens next.

And it's true that rates could continue to drop. But if you do decide to stick on a pricey deal and wait around for them, you could see the excess you’re paying now outweigh any future savings.

If you haven’t switched tariffs in a while, chances are you are on the standard and most expensive rate. Changing onto a fixed or online tariff could cut your bills immediately.

So with that in mind, here are the current cheapest energy tariffs:

Source: energyhelpline.com

All tariffs are available through the lovemoney.com energy centre.

As you can see, there’s still as much as £315 to be saved by switching onto the market-leading tariff.

The best deal currently around is the online iSave tariff from first:utility. However with the top fixed tariff just £31 pricier on average, it may be worth foregoing the cheapest deal for the peace of mind of a year-long, set-price rate.

* All calculations are for an average usage duel fuel household paying by monthly direct debit. Average usage as defined by OFGEM is 16,500 kWh pa of gas and 3,300 kWh pa of electricity.

** Against a typical bill of £1,345 per year (source: Ofgem).

More: Compare energy tariffs with lovemoney.com | The best and worst energy suppliers

For the latest news and comment on the stories that affect your money, follow us on Twitter