We all want to save money on our outgoings each month, and one of the best ways you can do this is by switching to the cheapest energy supplier. But it’s not always easy to know who has the best deals. And with more and more different energy companies coming to the fore, it’s no surprise that people are looking to switch away from the “Big Six” in search of a better deal.
On average though, many people can cut down their overall energy costs by simply switching over to a cheaper energy suppler. But how can you find them, and will switching to a different provider have an effect on whether you have any issues further down the line? That’s what we’ll be looking through to see.
Who is the Cheapest Energy Supplier in the UK?
We recommend that our readers try out a comparison service to find the cheapest energy supplier in their area. You can do this by visiting a website like Switchd, and then entering your postcode and email address in there. They’ll automatically search to find the lowest cost possible in your area, which can vary quite a lot depending on where you’re located.
There can be a drastically different cost if you’re located up in the Scottish highlands in comparison to down South; this can be down to a variety of different reasons, such as access to gas, and less controllable circumstances can have a massive effect on your energy usage too. If we travel a little further South than this, then the North of England actually has the lowest average energy costs in the United Kingdom.
Variable vs Fixed Rate tariff
When it comes to finding the lowest possible pricing for your energy, then the type of tariff that you’re on is definitely worth looking at. They’re pretty simple to understand, and many different energy providers will give you the option to choose between the two.
The good thing about a fixed tariff is that your energy rates are going to be set across the entire year. So if you use a certain amount of energy, you’ll pay the fixed rate, which doesn’t change throughout each month. Though you’re likely to still have more expensive bills come December, they’re not going to be affected by an increase in your energy rate cost too. For those looking for the cheapest energy, going for a fixed rate is usually best, as all of the very cheapest deals are at a fixed rate (usually 12 or 24 months).
A variable rate tariff is typically going to be more expensive over the course of a year, though it can end up being cheaper depending on whether the rate goes up or down. The benefit of this is that you can usually cancel your variable rate contract very easily. This means if you’re only looking for a short term deal then they may be worth looking into.
The Big Six
When it comes to reducing your energy costs, it’s often suggested that you move away from the big six. If you’re not aware as to who they are, they’re made up of British Gas (& Scottish Gas), EDF Energy, Scottish Power, SSE, Eon and NPower. However, things have changed a little, as Npower was eventually bought by Eon back in 2019. So it’s more of a big five now than a big six, but these few companies still dominate the market overall.
The price cap, which is the maximum that an energy provider can charge for your energy, is usually reviewed every six months to make it fair. However, the truth is that the big six often try to keep their costs right at the limit of the price cap, which means they charge the maximum they possibly can. This isn’t always the case, but it is in many circumstances.
This is why smaller providers like Bulb have become so popular, and are actually closing the gap on the big six in terms of customers – their main focus isn’t making the maximum profit they can. Instead, they take more things into consideration, especially when it comes to green energy and our consumptions affect on the environment (check out our Bulb Energy review here).
All in all, there is no one energy company that’s the cheapest all across the UK. If you live in a certain location in the South West, then the cheapest energy supplier for you will likely be different than someone living in London, or in the North of the UK. This is why energy switching services have become so popular in recent years, as they do all the leg work for you in finding a cheaper supplier than your current one.
Not only does your broad location matter, but it can also come down to the postcode your address is too. So, having a browse around the different switching options on the market is definitely worth your time, as you may be able to shave a huge chunk off your energy bills. You can look to brands like Octopus (check out our Octopus review) or Good Energy if you want to go direct to a supplier too, as they often have pretty good deals.