Is saving money among your new year’s resolutions? Your gas and electricity bills are a good place to start as we’ve found deals that could shave £343 a year off an average household’s payments.
And if you’re keen to combine a good price with great service, you could still save £267 a year and find an energy firm rated highly by its customers.
Plus, as the first energy firm announces a gas price cut for January, we look at whether lower bills could be coming your way in 2020.
Keep reading to see the top five cheapest energy deals or compare gas and electricity prices using Which? Switch, our independent energy comparison website.
You can also phone us on 0800 410 1149 or 01259 220235.
Cheapest gas and electricity deals
Below we’ve listed the five cheapest energy tariffs available now, based on the annual price for a household using a medium amount of gas and electricity.
The prices stated are the average across all regions, plus how much you would save compared with the current price cap limiting how much suppliers can charge per kilowatt hour (kWh) of electricity and gas.
This price cap is currently set at £1,179 per year for a medium user until April. But because the cap is based on the price of units of energy, your exact bill could be higher depending on how much electricity and gas you use.
Top five cheapest gas and electricity deals
Only the cheapest deal listed has exit fees. This means you can switch away from the other four deals at any time if you spot a better deal or don’t like the service. None of the firms has been rated in the annual Which? satisfaction survey yet so we can’t comment on their service.
Two of the tariffs are fixed deals. This means the price you pay per kilowatt hour of gas or electricity used will stay the same throughout your contract (12 months). This doesn’t mean the amount you pay is fixed though. If you use more (or less) energy than expected, your payments will change to match.
Companies can change the prices of variable deals as long as they give you at least 30 days’ notice.
Check the terms and conditions of tariffs carefully before you switch to see whether you’re happy with them. For example, The People’s Energy Company tariff requires customers to pay a security deposit of two months’ payments before your supply starts.
Cheapest deals from top-rated energy firms
To get the best on price and service, pick from our list of the cheapest deals from firms that are among the five highest-scoring in our latest annual energy companies’ satisfaction survey.
Top five cheapest deals from highly-rated firms
Although you’ll save slightly less with these deals than the five cheapest overall, you could still see your bills reduce by £267 a year.
So Energy and Robin Hood Energy’s deals come with exit fees payable if you wish to switch before the tariff comes to an end (they don’t apply in the last 49 days though).
All tariffs are fixed so you get price stability but Robin Hood Energy’s is the only one to last for two years.
It’s worth noting that So Energy’s tariff has ‘seasonal payments’. This means you pay 25% more in winter and 25% less in summer. You can opt out at sign-up and make equal payments year-round if you would prefer.
Gas prices are falling – will your bills follow?
Octopus Energy announced a price cut for around 250,000 of its customers from 15 January. They will save around £80 a year. The price cut applies to Affect Energy and Co-operative Energy customers too, as the latter was recently acquired by Octopus Energy. Co-operative Energy customers will save £160 on average a year.
It was the first company to announce a price drop for 2020, but other firms are expected to follow suit.
Octopus Energy CEO Greg Jackson said: ‘We’ve invested heavily in technology to enable us to deliver long-term low prices. Whilst other companies gleefully set prices close to the price cap level, we cut prices for new, loyal and acquired customers alike.’
Find out more about Octopus Energy.
Wholesale gas prices fell by half in 2019. This is owing to increased supplies of liquefied natural gas (LNG) to Europe from the US, Russia and Qatar. The beginning of winter has also been mild in many parts of the country so gas supplies have built up.
Next month, energy regulator Ofgem will announce the new level of the price cap on standard variable, or default, energy tariffs. This is the type of tariff you’re likely to be on if you haven’t switched deal or provider in several years.
Its calculations are based on the ‘underlying costs required to supply energy’. These include wholesale energy costs, based on forward prices for 12 months. So it may decide on a lower price cap from April.
But don’t let this stop you switching. Follow our simple steps to switch energy supplier to get the best deal for you.
Which? energy pricing research
Prices are based on a dual-fuel tariff available in the regions stated, paying by fixed monthly direct debit, with paperless bills.
Energy use is based on Ofgem’s annual average figures for a medium user (12,000kWh gas and 3,100kWh electricity per year).
Data is from Energylinx. Prices given are averages across regions, rounded to the nearest whole pound and correct on 2 January 2020.