The move comes shortly after it reduced its standard gas prices by 3.3% earlier this summer, and follows a 9% cut in electricity costs back in March.
Dual fuel customers who sign up to this new web-based tariff will pay an average of £1,017.41 a year.
That’s more than EDF Energy’s Online v5 tariff, which is the market leader at an average of £982.49 a year, but means E.ON is undercutting British Gas by £0.97 on average.
What next for customers?
British Gas has still not responded to E.ON and EDF’s price cuts, but it’s known for trying to provide the cheapest tariffs and could well retaliate with still lower bills.
These developments can only be good news for stretched UK households. Bills soared last summer, with the cost of electricity rising 28% and gas by an average of 47%.
Although further cuts are needed to offset last year’s hikes, any drop in prices will be welcome to customers as we move into the colder weather.
When to act
People wanting to take advantage of the EDF deal should move soon, according to moneysupermarket.com utilities expert Scott Byrom.
He comments: “EDF Energy still has the gold medal for cheapest tariff with its ‘fly by night’ product – this product is unlikely to remain on the market for long and the provider has the right to pull it at any time.”
Many homes fixed their energy tariffs last year to insulate themselves against any further rises and these deals will now be coming to an end. Once they do, most customers will be shifted onto their provider’s standard tariff.
Scott says this makes it particularly important for people to move to a competitive deal as soon as their fix ends. “All this activity is great news for bill payers and is perfectly timed for all the UK customers poised to come off a fixed energy tariff.
“Bill payers need to be aware that the big increases they could face when their current deal ends could wipe out any savings that they made when they fixed last year. Customers on Scottish Power’s Fixed Price 2009 deal, the next to end on August 31, could see their bills rise by £134.91 a year.”
What to do
If you’re one of the thousands of people whose fixed tariff is about to end, you’re probably wondering how to maximise your potential savings.
Read Scott’s recent article ‘Take advantage of the energy price war’ for some tips and advice on finding the best deal for your household.