Use ‘people power’ to make HUGE energy savings

Unimpressed by the Big Six energy suppliers’ measly price reductions these past few days? Frustrated that these cuts – barring one – won’t take effect for weeks or even months?

If so, you can join MoneySavingExpert’s big ‘collective’ energy switch, which is offering a ‘dual fuel’ (combined gas and electricity) fixed rate tariff at just £901 per annum for those with average consumption.

That undercuts the next cheapest fixed rate deal by more than £12 and is over £200 less than a typical standard variable rate tariff.

Prime mover

MoneySavingExpert is part of the MoneySuperMarket family, and has established itself as a major force in the energy switching market.

With its collective switching initiatives, you join with thousands of others to use people power to negotiate a much better deal.

Almost 60,000 people banded together to save a collective £10 million in MoneySavingExpert’s (MSE) Big Winter Switch Event in October 2014, making it the UK’s biggest ever collective switch.

Now, MSE has launched the Big Winter Switch Event II with an eye-catching one-year tariff from Sainsbury’s that comes in at £901 a year.

Also on offer are a three-year fix and a green energy deal from Greenstar Energy. Details below.

Here’s how a collective switch works:

  • gas and electricity bill payers who want a better deal sign up for a collective switch with a ‘trusted intermediary’ – such as MSE (local councils are another example)
  • the intermediary runs an auction among energy suppliers, who bid for a chance to offer special tariffs to the thousands of big switchers who’ve signed up
  • the best deals win the auction, and the switchers save.

In the last MSE collective switch, people who signed up saved roughly £200 a year each on their energy bills, as the deal negotiated by the site cost less than the cheapest deals widely-available at the time.

How to join the big switch

If you want to be part of the Big Winter Switch Event II, you’ll need to sign up before 5pm on Thursday, February 12.

To get involved, head over to the MSE Cheap Energy Club here and fill in your details. This will be easier if you have a recent bill to hand, but you can get an estimate without one.

What’s on offer

Sainsbury’s Energy (a partner of British Gas) won the MSE cheapest tariff auction with its Discount Fix February 2016 deal, which has an average annual bill of £901.

Compare that to the absolute cheapest deal available to everyone, the Extra Energy Fresh Fixed Price Jan 2016 v10 tariff, which costs an average of £913 per year.

With a fixed energy deal, the price of each unit of energy you use is fixed for the duration – 12 months in this case. You have to pay by monthly direct debit. If you want to switch to another deal before the end of the 12-month term, you’ll be charged £30 for each fuel.

Green Star Energy won the cheapest long (three-year) fix auction with its Rate Saver 36M Fixed MSE1 tariff.

Forgive the convoluted name and you’ll be able to fix your energy costs for three years with an average annual bill of £1,013. Compared to the next best comparable tariff that’s widely available, it’s a whopping £69 cheaper.

And if you care about the environment, the cheapest green tariff category winner was from Green Star Energy again. Its Green Saver 12M Fixed MSE1 tariff has an average annual bill of £967, knocking spots off its nearest ‘green energy’ competitor outside of the Big Switch, which costs £1,232 per year, on average.

The Green Star deals also carry a £30 per fuel exit penalty if you switch away early.

MSE has a handy FAQ page which will answer any questions or concerns you might have about collective switching. You’ll find it here.

Why you should join in

Following EDF Energy’s announcement on January 27, all of the Big Six energy suppliers have now cut their gas prices. But even the biggest price cut, from nPower, was little more than 5%. And the cut by SSE won’t take effect until April 30.

If you’re on a standard tariff, and even taking the recent price cuts into account, you’ll still save a lot more by switching to the cheapest fixed deal.

Please note: any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct.

* 51% consumers, MoneySuperMarket data, December 2014

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