The number of energy deals priced at under £1,000 a year has surged over the past 12 months, according to analysis from Which?
The consumer group looked at the availability of cheaper energy tariffs priced under £1,000 a year for a medium user – and found 78 deals available compared with just 12 when the energy price cap was first introduced on January 1 2019.
The cap was introduced by the energy regulator Ofgem to protect customers on poor value default or standard variable tariffs.
It was initially set at £1,137 per year, but following the first review in April 2019, it was raised to £1,254.
The price cap was later adjusted to £1,179 on October 1 2019.
The analysis also found 25 energy deals at under £900 on the market – a price that was not available when the cap was first introduced in January 2019.
The average price of the 50 cheapest deals was £899 compared with £1,025 when the price cap was first introduced at the start of last year.
Which? said falling wholesale prices for electricity and gas are among the factors which have allowed energy companies to offer customers cheaper deals.
It said despite the increase in cheap deals on the market, disengaged customers on default or standard variable tariffs could still be paying hundreds more than they need to – especially as the price cap level has yet to fall below £1,000 a year.
While price will be an important factor when switching energy suppliers, customers should also consider how firms compare on customer service and their performance when it comes to complaints handling and billing accuracy, the consumer group said.
Natalie Hitchins, head of home products and services at Which? said: “The number of cheap deals on the market has shot up in recent months, but customers stuck on standard variable or default tariffs may not realise they are paying hundreds more than they need to, despite the price cap.
“Customers fed up with expensive bills should consider shopping around to secure one of the many cheaper deals available – you could potentially save hundreds of pounds a year and find a supplier that offers better customer service.”
The prices were based on dual-fuel tariffs, paid by fixed monthly direct debit with paperless bills, for a medium user, using Ofgem’s averages.