Tackle energy tariffs Our tariff investigation

We gave 36 people the 'Which? tariff test' to see how difficult it was to work out the cost of energy. The results surprised even us. Only one of our 36 testers got the correct price for their gas and electricity.

Tariffs are too complicated

We asked our group to tell us what they'd pay on standard tariffs from Eon, Scottish and Southern Energy (SSE) and British Gas. They had to use only the companies' own websites to find the rates and tariff's details, but could use spreadsheets, calculators and pen and paper to calculate the answers.

Only one of the 36 – a company director – could do it. And a maths expert we consulted told us that even A-Level mathematics students would struggle to work it out.

 

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What’s so hard?

Energy tariffs are calculated in different ways depending on the company you are with and the type of tariff you're on. To calculate your bill you need to understand the unique way that your supplier calculates your energy, factoring in discounts and other tariff tricks that affect the final total.

To understand your energy costs it's not just a question of seeing who sells the units of energy at the lowest price. If you pay £20 per month for broadband, it's fairly easy to multiply that by 12 to work out that your annual cost will be £240.

But to calculate your energy bill you need to:

  • understand the structure (tiered structure or standing charge with unit rate)
  • for a tiered tariff, apply the right rate to the right consumption
  • calculate electricity and gas separately
  • apply direct debit and dual fuel discounts, if relevant
  • take into account possible discount caps
  • add it all together

These complicated steps all add up to one big headache – no wonder our tariff testers struggled. It doesn't have to be this way. 

Simpler tariffs

We also asked our testers to work out the cost of their energy using a much simpler tariff offered by Ebico and the Co-operative Energy – two of the smaller energy companies.

With the Ebico tariff, all the discounts had already been applied to the energy unit price. For our testers, it was simply a matter of multiplying the unit price by the number of units they had used. When we gave them this tariff, six out of 14 testers managed to complete the calculation without help. And four out of 14 got it right for the Co-operative.

Although that figure might still sound low, most of the problems they encountered were down to being unable to find the right information on the website. As the tariff involved just one simple calculation, when customers had the right figures, they got the right answer.

So how do I work out my bill?

Although you can use a switching site to help, we found that 1 in 5 do not use a switching site when choosing the best energy tariff for them. What's more, Ofgem data shows that only 60% of switchers achieve a price reduction when they switch supplier.

At the moment, without a switching site, the only way to accurately work out your bill is to go through the tariff with a fine toothcomb – and we'd advise you to ask someone to double check!

So we need your help to tackle tariffs – over 6,500 of you emailed Ofgem asking for a simple tariff system for all energy tariffs. But Ofgem has proposed a simple tariff system just for standard energy tariffs - meaning anyone not on a standard deal could still struggle to work out the cost of their energy.

We're asking Ed Davey to step in and make sure that we tackle confusing and unfair energy tariffs.

Find out more about the Which? simple energy tariff. As part of our Affordable Energy Campaign we've designed a tariff that will make the energy companies be fairer and more upfront about their tariff pricing.

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