Cheaper Electricity & Gas costs covered by loyal customers

Cheaper electricity and gas offers are costing long standing loyal customers over £150 more than they should be paying every year, MPs have been told.

However cheap deals for switching to another energy company are soon lost when energy firms ramp up their prices to claw money back, the Commons Energy Select Committee were told

About eight out of ten families that stay with the same provider – do so not knowing that the extra cash they pay out is used to attract new business.

Labour MP John Robertson said: “There are 85% of customers who don’t switch. What do they get for being loyal?” He added: “The perception of you guys is that you’re all a bunch of money-grabbing so-and-sos.”

Robertson’s remarks came after Stephen Fitzpatrick, the head of new provider Ovo Energy, told MPs that Britain’s big six energy giants were abusing loyal customers who did not like switching tariffs.

Fitzpatrick said: “We’re seeing an increase in the big six selling products to new customers at a loss in order to squeeze out new competition.”

He added: “It is predatory pricing to stifle competition.

“This is the biggest problem in the electric and gas sector. You could have two houses next to each other, using the same amount of energy, with one paying hundreds of pounds a year more than the other.”

He added that the poorest and most vulnerable people were those least likely to switch energy suppliers. Many of the cheaper gas and electricity deals are given on 'internet only tariffs' customers who don't switch are the older generation may not have access to the internet so keep paying more, yet they are the ones who need it most!

Britain’s top energy chiefs yesterday rejected Mr Fitzpatrick’s claims – but there was an admission they had not always treated customers properly.

85% of customers are paying too much for their bills to cut the costs paid by 15% of new customers who switch. Customers should be spending around £150 a year less.

EDF director Martin Lawrence admitted the big six had been “too clever” trying to rake in more profits in the past. He said: “(Have we) woken up and smelt the coffee? I think you’re right.”

Only time will tell, however there is one supplier that is different in the UK...

Switching on to green tariffs for electric and gas

I've been doing a bit of research on "Green energy tariffs" provided by utility energy suppliers, as they always sounded a bit suspect to me. The idea is that you pay a little more for your energy which offsets your carbon foot print for the gas and electricity that you use as well as investment in to renewable energy generation.


Now I'm all up for being eco friendly and I think we do our bit in our house for the environment and importantly doing our best to keep our energy bills as low as possible, so I wanted to see how much our energy would be on an eco friendly  "green tariff" I found it hard to believe that if I switched to a green tariff it would cost us an massive £136 per year which works out to be 21%. 


I found a great site about our carbon footprint simply called carbonfootprint.com to do some calculations on the energy we use, Now the total energy that we use causes a carbon footprint of 1.43 tonnes of CO2 per year, I then looked at what I'd have to do to 'offset' this energy use (you can see the results here) and I was stunned to find that I could offset our use by donating between £9.98 - £28.52, I know there is more to green energy than just the offsetting but even if I double or triple that, what I could spend through carbonfootprint.com to 'give back' to the environment I'd still be saving money!


Surely if sourcing energy from green and renewable sources utility companies should be providing and working to that goal anyway and not charging the consumer more.
So I've decided I'm going to stay on the tariff I'm currently on and pay to have some trees planted every year so I know where my money is going also this helps wildlife too. This is of course just my opinion and results based on my home.


Paul