Spot the cheapest energy deal with simple energy pricesWhich? is calling for change to energy tariffs
30 March 2015
Research conducted by Which? shows that simple energy prices will help consumers spot the best deal for them and make them more likely to switch.
Our research, conducted jointly with EDF Energy, showed that the number of consumers spotting the cheapest energy tariff doubled when using simple pricing, compared to the current pricing format of a standing charge and a unit rate.
Around half said they’d switch energy tariffs when they'd looked at a simple pricing table, compared to fewer than four in 10 who were given the table with the prices laid out in their current format.
Simple pricing means each tariff is presented as a per unit rate with no separate standing charge. This makes understanding energy prices more like understanding petrol prices – you can easily compare the cost of energy without having to work out how much you might use.
As part of our Fair Energy Pricing Campaign, we're calling for the Competition and Markets Authority (CMA) to recommend suppliers introduce simple pricing. Over 155,000 people have signed our petition - you can help, too, click Fair Energy Prices.
Simple prices make switching easier
The research asked 2,545 UK adults who are bill payers to choose between tariffs on either a price comparison website or a flat table. We asked them to spot the cheapest tariff using our simple pricing model compared to what's displayed now. We found:
- 91% could spot the best deal with simple pricing using a price comparison site, compared with 43% using the current pricing format
- 87% could spot the best deal with simple pricing and a newspaper 'flat table' scenario, compared with 35% using the current pricing format
- The average time people took to choose a tariff under simple pricing was 36 seconds, compared with 55 seconds for the current pricing format.
We used a behavioural research approach (an online experiment), rather than a traditional survey. This allows us to generate quantitative data about what people actually do, rather than what they say they do, which can be very different.
We carried out this research with EDF Energy, which has long supported this approach to simple pricing.
Which? calls for Fair Energy Prices
The CMA is currently conducting an inquiry into the British energy market. Our campaign calls on the CMA to require energy suppliers to do more to allow people to easily compare energy prices and make the best choice if they switch.
Which? executive director, Richard Lloyd, said: 'In a truly competitive energy market people should be able to spot the cheapest deal at a glance, making it easier to switch supplier.
'It’s encouraging that EDF, one of the country’s largest energy suppliers, is backing simple pricing. The current energy market investigation is a golden opportunity to put consumers first by introducing simple pricing.'
The research will be submitted to the CMA inquiry.
Make sure that you're not paying too much for energy. Use our independent switching site to find the cheapest deal for you - go to Which? Switch.