Energy company Eon has announced it will cut its standard gas price by an average of 5.1% and launched a new energy tariff that it says will be the cheapest on the market.
The price drop will take effect on 1 February. According to Eon, this will mean savings of £32 a year for a typical household – roughly the same as three weeks’ gas use.
The cost cutting comes as energy companies face criticism for failing to pass on falling wholesale prices to consumers.
Want the best energy deal? Take a look at our independent comparison service Which? Switch to see whether you could save money with a different energy provider.
Why aren’t energy prices cheaper?
This is the first price cut we’ve seen from the Big Six this year, despite the fact that wholesale energy costs are falling.
Our investigation in February last year found that bills should be substantially lower because market prices have dropped – read our news story revealing that energy bills should be lower for more information on this research.
Which? executive director Richard Lloyd said: ‘Eon has taken the first step by cutting its prices for gas deals. But given plummeting wholesale costs, consumers are bound to question whether it’s enough.’
Eon has said that while the price it pays for energy has dropped other factors could increase its running costs and affect its prices.
The company has launched a one-year dual fuel tariff which, at £783, it say is the cheapest available in the UK.
Which energy company should you choose?
In October 2015 we asked more than 8,000 energy customers to rate their suppliers on customer service, complaint handling, value for money, and accuracy and clarity of bills.
The Big Six lagged behind again this year, with none of them performing well enough to beat smaller providers.
To find out how the energy companies fared in our annual energy survey, take a look at our reviews of the best and worst energy companies.