Cheapest Energy Deals Are Under Threat
The energy regulator’s drive to slash the number of gas and electricity tariffs on the market may have the unintended consequence of killing off the cheapest deals fears Mark Todd, of energyhelpline, the price comparison website.
Mr Todd said the idea behind Ofgem’s tariff shake-up is a good one: ensuring energy companies offer a much-simplified menu of tariffs to their customers. Unfortunately, he said, Ofgem’s limit of four gas and four electricity tariffs per company is forcing suppliers to concentrate on their core business to the exclusion of many valuable, but non-mainstream, deals.
Typically they will offer a standard tariff, plus one short, one medium and one long-term fix. Mr Todd said: “As a result of the shake-up we are already starting to see a bonfire of cheap tariffs as energy suppliers begin to withdraw special rates. The reform of the pricing structure looks set to result in cheap discounted deals being scrapped. Green tariffs and those that are helping charities and the elderly could also go.”
He added: “We’ve seen the sparks from the tariff bonfire already, with E.ON’s withdrawal of its Staywarm tariff for over-60s this week. This is just the first ember. Expert the fire to rage over the next few weeks.”
Among the deals which energyhelpline expects to be dropped are virtually all the major suppliers’ green tariffs. In addition some of the cheapest deals currently on offer are expected to disappear