Not only are British Gas and ScottishPower not introducing cuts until February, but even then their tariffs won't be competitive.
Both British Gas and ScottishPower have announced cheaper gas prices in the past few days, grabbing lots of headlines in the process.
Great news, you might think, except for a few fairly important details. For one, the cuts don’t actually come into effect in February, when in theory much of the coldest winter weather is over and we’ll be using less gas.
There’s also the fact that despite the price reductions these two suppliers remain pretty expensive and easily beaten by other suppliers in many parts of the UK.
And the cuts are still well below the drop in the wholesale price of gas, which has plummeted by 20% in the past year.
Price cuts
British Gas announced that it is cutting gas prices by 5% from 27th February, reducing the average bill by £37 a year.
Meanwhile, ScottishPower says it is lowering its gas prices by 4.8% from 20th February, which it says will cut the annual average bill by £33.
Yet even with these changes between them both companies only offer one tariff that makes the current top 10 best buy table for dual fuel. That’s ScottishPower’s just-launched Online Fixed Price Energy February 2016 tariff.
British Gas currently doesn’t have a dual fuel tariff with an average annual cost below £1,000, putting it way behind the competition.
Even with the gas price reduction, its tariffs aren’t going to trouble the market leaders.
[SPOTLIGHT]And, rather than cut prices for customers, instead it’s offering a £50 Amazon gift certificate to people who switch to its Fix & Reward February 2016 tariff.
Only E.ON passed on its gas price cut of 3.5% immediately.
British Gas and ScottishPower have both said that they have had to wait until now to pass on the drop in wholesale prices. There's also the spectre of possible Government price intervention in the energy market after May's General Election, which means the bigger energy companies don't want to cut too much now.
What this means is it's worth looking at what other, smaller companies are offering if you want to potentially save on your bills.
Compare all the gas and electricity tariffs in your area and see if you could save
Cheapest tariffs right now
As you can see from the table below, there's a price war going on to offer the cheapest tariff among the smaller suppliers.
|
Energy supplier |
Tariff |
Type of tariff |
Average annual cost |
|
Extra Energy |
Fresh Fixed Price Jan 2016 v8 |
Fixed (until January 2016) |
£918 |
|
Extra Energy |
Clear Fixed Price March 2016 v4 |
Fixed (until March 2016) |
£919 |
|
First Utility |
iSave Fixed March 2016 (v44) |
Fixed (until March 2016) |
£919.49 |
|
OVO Energy |
Better Energy Fixed (Online)* |
Fixed (for 12 months) |
£920 |
|
E.ON |
EON Fixed 1 Year v14 Paperless |
Fixed (for 12 months) |
£922.99 |
|
Extra Energy |
Bright Fixed Price Jan 2016 v8 |
Fixed (until January 2016) |
£925 |
|
ScottishPower |
Online Fixed Price Energy February 2016 |
Fixed (until February 2016) |
£930 |
|
Green Star Energy |
Rate Saver 12 Month Fixed 1501 |
Fixed (for 12 months) |
£931.60 |
|
E.ON |
E.ON Fixed 1 Year v14 Paper |
Fixed (for 12 months) |
£932.99 |
|
Co-operative Energy |
Fair & Square March 2016 v2 |
Fixed (until March 2016) |
£944 |
Source: lovemoney gas and electricity comparison centre
Prices based on average consumption as measured by Ofgem of 13,500kWh of gas and 3,200kWh of electricity and a customer paying by monthly direct debit including VAT.
*Not available in region 17 - Scottish Hydro area
With the rest of the Big Six (EDF, npower and SSE) likely to follow suit and implement small cuts in gas prices only, it's not worth sticking with a Big Six supplier simply in the hope of lower prices soon.
Compare all the gas and electricity tariffs in your area and see if you could save
More on household money:
The quickest energy firms to switch to
Extra Energy: little-known provider that's beating the Big Six