Small energy supplier Outfox the Market - which currently offers the market's cheapest overall energy deal based on typical use - is increasing some of its monthly membership fees from 1 June. But only households with more than double the average electricity use will see bills rise.
Update Wednesday 16 May: Outfox the Market has now announced it will NOT change its membership fees for anyone on its fixed 'Whack!' tariff - though those on its variable Zapp tariff will still be hit by the changes below. The supplier has said that anyone on its fixed tariff who still wants to switch away will be able to do so without paying any exit fees before Friday 11 June.
Outfox the Market, which launched in September 2017, is one a new breed of suppliers that charge a monthly membership fee instead the more common daily standing charge.
When it launched, the monthly fee cost between £6.99 and £13.99, depending on your usage. However the shake-up means that from June customers on both its variable and fixed tariffs could pay anything from £6.99/mth to a whopping £53.99/mth.
For most though, there won't be any change. You'll only pay more if your electricity use is more than 6,400 kilowatt hours (kWh) per year - more than double the typical amount used by the average household. And if you do want to leave as a result of the changes, Outfox the Market's waiving any exit fees for those who switch away before 1 June.
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How are Outfox the Market's fees changing?
Outfox the Market charges its monthly membership based on your annual electricity usage. You give all suppliers annual usage when you join, which are validated by a third party, and Outfox uses this to put you in a bracket. If your actual usage is different, and you move up or down a band over the course of the year, you may be charged extra (or credited) when Outfox the Market assesses your usage at the end of your first year.
If you use less than 6,400 kwh/year the amount you pay won't change at all when the changes come in - Outfox's existing usage bands will apply. So here's what you pay now and will continue to pay from 1 June:
- 0-2,399kwh/year - £6.99/mth
- 2,400-3,499kwh/year - £8.99/mth
- 3,500-4,599kwh/year - £10.99/mth
- 4,600-6,399kwh/year - £13.99/mth (currently this bracket covers anyone using 4,600+kwh/year, but from 1 June this will be capped at 6,399kwh/year.
This means that for most Outfox's variable Zapp tariff remains the cheapest on the market, at an average £807/year based on typical use - around £5/year less than the next-cheapest from brand-new supplier Usio Energy.
However if you use more than 6,399kwh/year, you'll now fall into one of the following 16 brand-new usage brackets - and for really heavy users this will mean a steep price increase.
- 6,400-7,199kwh/year - £14.79/mth - so 80p/mth more, or £9.60/yr
- 7,200-7,999kwh/year - £14.99/mth - £1/mth more, or £12/yr
- 8,000-9,199kwh/year - £15.99/mth - £2/mth more, or £24/yr
- 9,200-10,799kwh/year - £16.99/mth - £3/mth more, or £36/yr
- 10,800-12,999kwh/year - £17.99/mth - £4/mth more, or £48/yr
- 13,000-16,799kwh/year - £18.99/mth - £5/mth more, or £60/yr
- 16,800-18,499kwh/year - £22.99/mth - £9/mth more, or £108/yr
- 18,500-22,999kwh/year - £25.99/mth - £12/mth more, or £144/yr
- 23,000-24,999kwh/year - £29.99/mth - £16/mth more, or £192/yr
- 25,000-26,999kwh/year - £31.99/mth - £18/mth more, or £216/yr
- 27,000-29,999kwh/year - £33.99/mth - £20/mth more, or £240/yr
- 30,000-34,999kwh/year - £36.99/mth - £23/mth more, or £276/yr
- 35,000-39,999kwh/year - £40.99/mth - £27/mth more, or £324/yr
- 40,000-44,999kwh/year - £44.99/mth - £31/mth more, or £372/yr
- 45,000-49,999kwh/year - £49.99/mth - £36/mth more, or £432/yr
- 50,000+kwh/year - £53.99/mth - £40/mth, or £480 over 12 months
While the rise for anyone with a massive house or really heavy energy use could be as much as £480/year, this won't be very common. According to the energy regulator Ofgem, the average household in Britain uses a typical 3,100kwh - and even a high user would only use 4,600 kwh.
Yet if, for example, you used say 10,000kwh electricity per year and 38,700kwh of gas (scaling up from Ofgem's typical usage of 3,100kwh for electricity and 12,000kwh for gas), on Outfox the Market's Zapp tariff you'd see your bills rise from £2,421/year to £2,457/year.
With the same usage, on the next cheapest tariff, you'd pay £2,307/year. So if you've a large home or you use a lot, you may be able to save a fair whack by switching away once the price changes come into effect.
As prices vary by region as well as usage, the best thing do is a full market comparison via our Cheap Energy Club and see if Outfox the Market still works out as cheapest for you.
What does Outfox the Market say?
Bradley Goodfellow, head of operation at Outfox the Market, said: "Our business model is based on providing wholesale energy prices in exchange for a monthly membership fee, which is based on a customerís annual consumption.
"One of our aims is to ensure customers with low usage do not pay more because of the needs of those with far greater demand. This is in contrast to a daily standing charge which is universal and results in a one-bedroom property having the same cost as a four-bedroom property - I donít believe this is fair. I have decided to change the membership bands in line with this policy to make if fairer for all.
"It is important to note that for the vast majority of our customers these changes will have little, or no effect. To highlight this, I am willing to waive any exit fees for customers on our fixed price tariff who may take the decision to switch to a different supplier."
Membership fee-based Pure Planet is reducing prices
One of the few other suppliers that charges monthly membership fees instead of daily standard charges - Pure Planet - has just announced it's reduced its fees. From 1 May it's charging £8.50/fuel per month instead of £10/fuel - a saving of £36/year for dual-fuel customers
However it's worth noting Pure Planet increased the unit rates for its only tariff - 100% green - on 14 March 2018, meaning the average dual-fuel bill based on typical use rose from £858/year to £908/yr.
The latest reduction will see its average price fall to £872/year - £14/year more before the March hike and still £65/year more than Outfox the Market, based on typical use.