Comment on recent activity in the utilities market

Published:

22/07/2009

Topic:

Press Release,Gas & Electricity

Scott Byrom, manager of utilities at moneysupermarket.com, said: "EDF has toppled British Gas off the top spot with what could be a 'fly-by-night' tariff.

"It has become a long-standing tradition that British Gas strives to offer British bill payers the best value online energy deal on the market. However, the last few days have seen a flurry of activity to the contrary - challenging British Gas' reign. We have seen Scottish Power improve its online product offering, npower launching market leading products for 'high' and 'low' consumption energy users, and a move from EDF which has seen British Gas's WebSaver 3 product take a direct hit - knocking it from the top position to offer the cheapest annual online dual fuel deal at a competitive £983 a year. These moves will hit British Gas hard, and there's no doubt it'll only be a matter of time before the energy giant retaliates.

"This activity is perfectly timed for all the UK customers poised to come off a fixed energy tariff. Fixed rate deals were in vogue last year - 70 per cent of moneysupermarket.com customers who swapped provider in July 2008 chose a "fixed" energy tariff saving themselves an average of £134.50 a year against a back drop of sharply rising prices, Ofgem research also found that around 4.6 million people are on a price guarantee tariff of some sort.

"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. Timing is crucial when proactively looking for a new energy product, move off your fixed rate too early and you could face termination fees of up to £75.  Move too late and you might find yourself automatically switched to the standard deal or locked into a less attractive fixed deal, this isn't ideal as we move into the colder autumn and winter weather when bills are traditionally higher as consumption increases.

"Customers on the npower One deal for example see their 12 month fixed tariff come to an end next week (31 July 2009) and will face an automatic price hike of £231 a year if they revert to the supplier's standard offering while all those on Scottish Power's Fixed Price 2009 deal, which ends on August 31, could see their bills rise by £340 a year."

-Ends-

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