£7.6 billion energy saving black hole
UK households could reduce their annual energy bills by a quarter (26 per cent), the highest average saving since 2010, by simply switching for the first time.
Ofgem research shows that 62 per cent of bill payers have never changed energy provider and are still with the traditional supplier in their region. But households could save £350 on average by switching to the cheapest available product according to analysis from MoneySuperMarket.
The research carried out by the comparison site also shows that those living in Yorkshire, who’ve never switched, would benefit the most by making the move to the cheapest deal with an impressive saving of 28 per cent (£383).
Additionally, of the UK’s 14 energy regions, bill payers living in the North Scotland region who are still customers of their traditional supplier and are paying by Quarterly Cash or Cheque (QCC) have the highest average annual bills at £1,383 for their gas and electricity. Conversely, the cheapest energy bills paid by those who have never switched (and pay by QCC) are found in the East Midlands where the total dual fuel bill is £1,298 - £85 a year less on average than those in North Scotland pay.
Even those who pay their energy bills via Monthly Direct Debit (MDD) could save an average of £269 a year by switching to the best value deal.4 Customers in Yorkshire have the most to gain, with an annual saving of £297 (23 per cent).
Clare Francis, editor-in-chief at MoneySuperMarket said: “The Competition and Markets Authority inquiry into the energy market may result in a shake-up for the industry, but it will be some time before customers see any benefits. However, our research shows the possible savings to be made by switching supplier for the first time are at their highest level since 2010. Customers therefore need to take matters into their own hands and act now, not wait for changes to be forced on the industry. Ofgem highlighted very few people switch energy providers, which seems ludicrous when you see the amount that can be saved: 10 minutes of your time could result in a £349 reduction in your annual bill.
“Even if you have switched energy provider in the past, if you’ve been on the same deal for more than 18 months, chances are you’ll be paying more than you need, so look to see if you can make savings by switching to a cheaper tariff.
“And remember, if you’re currently on a fixed price plan, you need to switch when it comes to an end otherwise you’ll see your bills leap. Tens of thousands of householders are on fixed products that will end over the next four weeks, so it’s time for them to apply for a new deal. The good news is the leading deals have come down in price. We’ve seen a number of new energy tariffs launched as providers seek to take advantage of the fact so many people are on fixed deals that are about to end. And it’s the smaller firms such as First Utility, Flow Energy, Extra Energy and OVO Energy that are challenging the dominance of the ‘Big Six’ by offering the most competitive products. So in order to maximise the savings, it is probably well worth changing provider, rather than just moving onto a cheaper product from your existing supplier.”