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How to choose the best energy tariffs

Posted March 07, 2024

When it comes to choosing the best energy tariffs, deals or plan (they're the same thing), do you know your fixed rate from your variable tariff? And does your type of meter affect the deals you can get?

How you use energy is unique to you. What's best for you, might not mean the cheapest gas and electric tariff. Here's everything you need to know about choosing the best gas and electric deals and energy prices for your household.

What are energy tariffs?

Energy plans or tariffs are simply the name given to the way you choose to pay for energy you use in your home or household.

However, depending on how you use energy there're different tariffs which will better suit your lifestyle and home. We've broken them down into bite-sized chunks so you can better understand which tariff will work best for you.

Fixed energy tariffs

A fixed tariff gives you peace of mind and makes it easier to budget. You'll pay a fixed price for your energy, so if wholesale prices go up, the price you pay stays the same for the length of your contract. It helps make budgeting easier and gives you peace of mind, as you know how much you're paying, and you're protected from wholesale energy price increases for the length of your fixed contract.

It's worth remembering that it's the plan rate that's fixed and not your monthly payments. If your energy use goes up (or down), your monthly bills change accordingly. However, a fixed tariff can give you the reassurance that any market and industry price changes won't affect your budgeting.

Fixed tariff pros:

  • You’ll pay the same rate for the amount of time you're on the tariff
  • You won't be affected by price rises
  • You’re not constantly shopping around for the best deal
  • Some of the best deals cab be found for fixed tariffs
  • EDF's fixed energy plans are back by zero carbon nuclear electricity(1)

Fixed tariff cons:

  • If energy prices go down, your price stays the same and doesn't lower
  • Fixed tariffs often come with exit fees - meaning you have to pay a fee if you leave earlier than your contract end date
  • It might become a more expensive deal when your fixed rate period comes to an end

Variable energy tariffs

If you don’t mind prices going up or down, a standard variable rate could be your best option.

These tariffs track the wholesale market rate for the energy you pay. Payments change depending on wholesale costs, so budgeting isn't as easy as on a fixed tariff. If prices change, your supplier has to let you know at least 30 days before it happens, so you can decide if you’d like to switch, usually with no exit fee.

A lot of people who are on these tariffs haven't switched in a long time. If that's you, be sure to compare prices and see if you can get a better deal. Another thing to remember is standard variable tariff are affected by Ofgem's price cap. This means there's a cap on how much providers can charge customers, even if the market prices go up drastically.

Standard variable tariff pros:

  • You’ll be the first to benefit from price decreases
  • No exit fees
  • No contract end date

Standard variable tariff cons:

  • Energy price rises will affect you - only up to Ofgem's price cap
  • You’ll pay different amounts which can make budgeting more tricky
  • You're not protected from what's happening in the energy market
  • There are rarely any special offers or deals available

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Dual fuel tariffs

A dual fuel tariff means you get both gas and electricity from one supplier. Single fuel means you get either gas or electricity from one supplier. So you could have two suppliers – one for gas and one for electricity.

Dual fuel can be better because:

  • You only have to get in touch with one provider, rather than two
  • It can be cheaper than buying single fuel from two suppliers

Your energy meter type and tariffs

Depending on whether you have a prepayment, standard or smart meter, can also affect which energy tariff is available to you.

Picking a new energy tariff with a smart meter

Smart meters help you manage your energy more easily as you get a monitor that shows you how, and when, you're using your energy. They automatically send meter readings to the supplier. Getting a smart meters usually means you get the greatest choice of energy tariffs to choose from.

Smart PAYG meter tariffs

All smart meters can be programmed to be pay as you go (PAYG) meters. This just means you pay for your energy up front, rather than by Direct Debit.

Paying as you go can give you more control of the energy you use, and therefore more control on how much your energy costs you. You choose how you top up, when you top up – and how much you spend each time you top up your meter.

Most energy suppliers offer the choice of topping up by an app, online, over the phone, at your local PayPoint retailer – or even set auto top-ups.

Your smart meter shows how much energy you're using in pounds and pence, as you use it. You can also set low-balance alerts and a daily budget. To learn more, watch our guide to smart PAYG meters

Standard meter energy tariffs

A standard meter usually means a meter that isn't a smart meter. In order to get the most accurate bill, you'll need to send regular meter readings to your energy supplier. As they're not a smart meter, it may mean you can't get the best energy deal available, as they're only available to people with smart meters. Upgrade to a smart meter at no extra cost

Prepayment meters and tariffs

If you have a prepayment meter, also knows as top-up meter, there may be fewer tariffs available to you. This is because your meter isn't a smart meter, and many energy deals are now suited to the benefits that only smart meters offer.

Some suppliers may not even have any energy deals for prepayment meters. Be sure to have a look at our prepayment tariffs

If you'd like to upgrade to a smart meter (you can still pay as you go), please book a smart meter installation appointment

Deemed energy tariffs

These are standard energy tariffs you're automatically placed on if you haven't signed up for a new plan. This can happen if you move to a new home or business premise and start to use gas or electricity, (or both), without first setting up a new energy tariff. A deemed contract may also happen if your tariff comes to an end, but are continuing to use energy, before sorting out a new tariff.

Electric car tariffs

There's now a good selection of electric tariffs for EVs and some are very competitive. Consider when you're most likely to charge your car at home and look at tariffs that offer cheaper electricity when it suits you and your needs. This may seem a bit more complicated than your traditional home tariff but really, it's just thinking more about how you use your energy and choosing a tariff that works for you. It's definitely worth it!

Green tariffs

Most energy companies are investing in renewable, green or zero carbon energy. This should be important to all of us, as we're looking to reduce Britain's carbon emissions to zero. However, some of these claims may be less 'green' than others and the energy you actually get may not necessarily be what it seems. So make sure you look into what it is a supplier is actually offering. Our fixed and GoElectric fixed EV tariffs are back by zero nuclear carbon electricity as standard(1).

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