Is It Time to Switch? Exploring Gas and Electricity Deals in 2025
Is It Time to Switch? Exploring Gas and Electricity Deals in 2025.
A new energy price cap of £1,738 for Great Britain will take effect on 1 January; however, there are opportunities to secure more advantageous deals.
The most recent energy price cap was implemented on 1 January 2025. Set at £1,738 annually, this figure represents a 1.2% increase compared to the previous quarter. The price cap pertains to the standard tariffs offered by energy providers, and this amount is calculated for an average household consuming gas and electricity while utilizing direct debit for payments. It is important to note that the actual bills for most households will vary, as they are determined by individual energy consumption.
Do I have to pay the standard tariff?
No. During the initial phase of the energy crisis, it became unfeasible for providers to offer rates below the price cap, leading to the closure of several companies due to their obligations, and effectively halting the switching market.
Currently, however, consumers can secure better deals than the default rates. There are both fixed and variable tariffs available at lower prices, and with the price cap expected to rise again in April, it is possible to lock in rates that are below those anticipated for spring.
Elise Melville, an energy expert at the price comparison platform Uswitch.com, indicates that there are “significant savings” available, noting that “the average household could save up to £148 per year compared to the January price cap by opting for a 12-month fixed deal.” This saving pertains to the Big January Sale – Fix’d Dual v1.0, offered by a company named Outfox the Market.
Melville indicates that customers with outstanding debts may have the opportunity to change suppliers if their unpaid bill is not older than 28 days. If the bill exceeds this timeframe, customers must settle their debts before they can switch providers.
However, she says: “Even if you’re in debt, it’s worth checking if you can save by moving to a new deal with your current supplier, which could help you to lock in lower rates.”
How do I find a better deal?
Utilizing a price comparison website such as Uswitch, GoCompare, or The Energy Shop is the most straightforward approach. These platforms generally gather extensive information from energy suppliers, allowing you to input minimal details to receive a quote, which may surprise you with the volume of data available.
After entering your usage information and selecting the type of energy you wish to compare—likely both gas and electricity—as well as your payment method, you will be presented with a list of available tariffs. This list will indicate the cost for your current energy consumption, the nature of the deal—whether fixed or variable—and its duration. A fixed deal ensures that the unit price of gas or electricity remains constant, although your bills will fluctuate based on your usage.
Additionally, the comparison will highlight any exit fees associated with the tariffs. These fees apply if you decide to switch providers before the contract term concludes, typically comprising one fee for gas and another for electricity. While some exit fees may be as low as £25 each, others can reach £100.
It is important to note that comparison sites often prioritize deals from providers that offer them commission for referrals. However, you should be able to access a comprehensive list of all available offers by utilizing filters that display the entire market.
Currently, the most affordable tariffs include a variable deal from Home Energy and fixed tariffs from Outfox the Market. These providers do not participate in switching sites, so they will only appear if you select the option to view all deals. To switch to either provider, you must contact them directly.
How do I know which one is best?
Emily Seymour, the energy editor at the consumer group Which?, says: “You should compare what your monthly payments would be on a fixed deal with what you’d expect them to be if you remain with the price-capped variable tariff to see what the best option is for you.
“As a rule of thumb, we’d recommend looking for deals cheaper than the price cap, not longer than 12 months and without significant exit fees.”
Other useful information?
If you are currently on the standard tariff, you should not incur an exit fee when switching providers. If you have made a recent switch, it is advisable to verify whether any penalties apply, and if so, ensure that the potential savings exceed those costs.
For those who choose to remain with their current provider, it is prudent to confirm that you are not overpaying for your energy consumption by submitting a meter reading this week. It is important to avoid paying January 2025 rates for energy consumed at the lower December 2024 prices; therefore, if you do not possess a smart meter, please take a reading now and submit it.
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The recent energy price cap increase to £1,738 highlights the ongoing strain on household budgets as energy costs continue to rise. While some fixed deals offer modest savings, they are often short-term solutions with potential exit fees, leaving consumers with limited options for long-term financial relief.
The 1.2% rise in the price cap underscores a worrying trend, as further increases are anticipated in April. For many, even the cheapest tariffs remain unaffordable, and reliance on price comparison tools feels insufficient against systemic issues driving costs upward. The rising energy costs exemplify the challenges facing consumers in an increasingly volatile market.
