The rewards for switching energy supplier plummet in a year, making it the smallest difference since 2012
- Households can save just a third of what they could a year ago by switching
- It was the smallest difference in savings since 2012, watchdog Ofgem found
- Last year the cheapest deal cost £338 less than the average default tariff
Households can save just a third of what they could a year ago by switching energy supplier.
Customers who ditched expensive default or standard variable tariffs in favour of the cheapest on the market could cut their bills by £103 last month.
It was the smallest difference in savings since 2012, energy watchdog Ofgem found.
Last year the cheapest deal cost £338 less than the average default tariff, down from £400 in 2019.
Households can save just a third of what they could a year ago by switching energy supplier
The findings come as Ofgem prepares to raise its price cap, hiking bills by £150 for 15million households.
Avro Energy’s Simple and Flow 12-month tariff was the cheapest on the market at £1,035 a year in July, according to comparison site GoCompare.
In the same month in 2020, the cheapest fixed deal was £788 with Outfox The Market.
The current price cap, which limits how much firms can charge customers on standard variable tariffs, is £1,138 a year, based on average usage.
This is expected to rise to £1,288 from October as wholesale prices soar.
Experts are also seeing more fixed-rate energy deals topping the price cap.
Karin Sode, managing director of People’s Energy, says: ‘No energy supplier can keep their tariffs low any more without them being loss-making.
‘Energy suppliers have no choice but to have higher tariffs to cover the costs associated with buying the energy.’