Five of the Big 6 energy companies have rapidly increased their ‘standard variable tariff’ (SVT) in recent months, with some increasing it by as much as 15%. The Government has reacted.
Against a backdrop of rising inflation hurting households and growing concern in Government over the effectiveness of the energy market, the Conservatives have pledged to rein in energy companies by putting a price cap on the SVT. Energy Scanner understands from energy lobby groups that the policy is almost certain to be implemented.
Approximately 2/3rds of Britons pay the SVT. They pay it unnecessarily, because it’s simply a default tariff that applies if you don’t switch or don’t lock in a fixed price deal. And new analysis reveals how much this costs you, and how lucrative these tariffs are for the energy companies.
The policy announcement has had an immediate effect on the value of the Big 6, with British Gas’ and SSE’s share prices falling quickly. Investment bank, Berenberg, calculated the policy would cost energy suppliers collectively at least £1.7bn a year, while analysts calculated that British Gas’ earnings will fall by as much as £300m.
SVT is a big deal, and an expensive option for customers. But simply by switching your home energy to a better deal, you can avoid the SVT. It’s easy, and could save you £100s a year and help the economy to the tune of billions!
Visit energy-scanner and compare electricity and gas prices for your home.