Three out of five households are still paying an average £300 more than they need to for their energy despite near-record switching rates this year.
Energy regulator Ofgem found 60% of customers are still languishing on expensive standard variable energy tariffs, though the number of customer accounts for these poor value rates dropping from 15 million to 14 million between April 2016 and April 2017.
It also found annual switching rates reached almost 17% in June 2017 - the highest since August 2011 - but is calling for more to be done to encourage others to switch.
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You could save an average £300 swapping to the cheapest tariff
Ofgem's report describes a two-tier retail market, in which there are good deals for those willing to shop around, but not for those who don't. Its key findings were:
- £300 could be saved on average each year swapping from a standard variable tariff to the cheapest fixed deal
- 58% of customers have never switched, or have only switched once
- £1,123 was the average annual dual fuel bill for a customer with one of the big six energy suppliers in 2016
- 49 dual-fuel suppliers are in the market, plus seven gas-only and four electricity-only
- 11 new energy suppliers have joined the market since June 2016
- Around 80% of all customers are supplied by the big six energy firms
- British Gas is the largest supplier, with 33% of the gas market and 22% of electricity
- 26 million switches were applied for last year, but only 22.6 million switches went ahead
Ofgem’s chief executive, Dermot Nolan, said: "Energy is an essential service and so we want to ensure that the markets work in the interest of all consumers. Transparency is crucial in informing debate and policy development in the energy sector. This annual report shines a light for the public, experts and stakeholders on where the market is, and where it isn’t, working for consumers.
"It is also a report for us, Ofgem. It will help inform the way we regulate, to protect consumers now and in the future."
