British Gas launches the cheapest big six deal since 2016
British Gas has launched the cheapest big six deal in almost three and a half years, as energy prices continue to fall throughout the market.
The new Energy Plus Protection Mar 2021v2 tariff costs a typical dual-fuel household £839/yr on average. The last time it was this cheap for a big six deal was back in October 2016, when British Gas offered a tariff for £796/yr based on typical use, via the Sainsbury's Energy brand (which it no longer runs).
Plus, if you go via our Cheap Energy Club – and the deal is only available via comparison sites, not direct – you get £25 MSE cashback.
Including the MSE cashback, the new one-year fix is £341/yr cheaper than the average big six standard tariff of £1,155/yr, under the new price cap rate from April. And it's very close to being the market's all-round cheapest, only beaten by a few tiddlers with little or poor customer service.
The tariff is available for both new and existing dual-fuel customers – so it's a no-brainer if you're a loyal existing customer as you won't pay any exit fees for switching to it. Your rates are locked in until 31 March 2021 (the price you pay varies with use), and the tariff comes with 100% renewable electricity and one year's 'free' heating insurance. There are £60 early exit fees and smart meters are required if you can get them (it'll install them for free if you don't have them already).
If you just want the cheapest energy deal, or want to compare against other tariffs, do a full market comparison.
How do big six prices compare?
British Gas has the cheapest tariff of the big six, though there are a few good deals from some of the other major suppliers (all are one-year fixes and average prices are based on typical use). Here's how they compare:
- British Gas – £839/yr (new and existing customers)
- Scottish Power – £843/yr (new and existing customers)
- EDF – £850/yr (new and existing customers)
- E.on – £874/yr (new customers only)
- SSE – £946/yr (new customers only)
- Npower – £1,018/yr (new and existing customers)
All of the tariffs above come with £25 MSE cashback if you go via our Cheap Energy Club, and most are only available via comparison sites. Do a big name comparison to compare all deals from the major providers.
The very cheapest deal on the market right now is a variable tariff from Outfox the Market at a typical £791/yr, though it has performed very poorly in our recent customer service polls, so think carefully before switching to it.
Why are prices so cheap?
It's not just British Gas that has been cutting the price of its cheapest fix – over the past year we've seen steady declines in the cost of energy tariffs across the market.
A key reason for this has been falling wholesale prices. However, this most recent price cut from British Gas is likely down to the massive slump in oil prices yesterday (Monday 9 March). This was after a fresh price war was sparked by Saudi Arabia slashing prices of crude oil after talks broke down with Russia over a proposed reduction in oil production to mitigate falling demand, with demand largely down due to the coronavirus outbreak.
According to energy analysts Cornwall Insight, the global price of crude oil has fallen by over a third since last Thursday – to its lowest level since February 2016. As a result, the analysts have said that this, combined with low gas prices, "has the potential to trigger further declines in the UK wholesale (and in turn, the retail) gas and electricity markets".