It is reported that more than half of UK households are on standard energy tariffs. This results in a financial headache for millions, after last week’s energy price cap by UK energy regulator, Ofgem. But why are there no domestic tariffs available?
Are there any domestic tariffs options?
For years, experts, media and commentators have implored customers to ‘compare and switch’. Consumers were told to avoid standard variable tariffs and ensure they are on the cheapest energy tariff. However, a simple search today would yield vastly higher than expected prices and fewer, or even no tariff options.
Quite simply, the wholesale prices energy suppliers are currently being forced to pay has resulted in them removing tariffs, as few, if any, want new customers.
Why are energy suppliers not offering domestic tariffs?
Consider that larger energy suppliers, who are currently taking on customers from suppliers who have gone out of business have, more than likely, not hedged for this outcome. The cost of onboarding these customers is roughly estimated at £500 per customer. Therefore, it is predicted, that the cost of the energy crisis is expected to run into billions.
The April 2022 price cap is set to see an increase of £200 plus. Inevitably, customers will be left to foot the cost of the energy crisis for years to come.
What can customers on standard rate tariffs do?
Customers currently on a standard variable tariff are protected by the Ofgem energy price cap. This means that unless already tied to a fixed rate tariff, they may be better off staying where they are, due to the protection it offers.
Consumers should be safe in the knowledge that Ofgem's Supplier of Last Resort (SoLR) will ensure those households with an at-risk supplier are not left without gas or electricity. However, they should contact their current energy supplier to ensure they are on the very cheapest tariff available, even if that does mean it’s the standard variable tariff.
How can households save money by reducing their energy usage?
- Switch all electrical appliances off at the wall, rather than leaving them on standby to save you £35
- Cut back on the use of kitchen appliances, such as the washing machine, dishwasher, tumble dryer - Washing at 30° can save an extra £9
- Only fill the kettle with the amount of water required to save £6
- Turn down your main thermostat by 1 degree, you can save around £60
- Reducing the time spent in the shower by 1 minute, could save a family of four £75 a year
- Turn off the tap whilst brushing your teeth can save up to 200 gallons of water per month
- Use a washing up bowl rather than running water and save £25 a year
- Turn lights off when you’re not using them and save you around £15 a year
- Make the most of the energy you’re paying for by installing a smart meter to help track and manage energy use
Click to find out more information about our void energy management service.