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It’s official: You’re paying too much for energy

After 18 months of investigation, the government’s Competition and Markets Authority (CMA) has released their report on the energy market.

The CMA found around seven in ten customers of the big six energy firms are on the most expensive tariff – costing a total of £1.7 billion every year. If they were to switch to the best deal, the average saved would be more than £300 per household.

These results have led to the proposal of some big changes. Here’s what you could expect to see:

Price control for anyone using a prepayment meter

There’s limited competition and it can be harder for people to switch, but fixing prices could help four million homes. Starting in 2017 for four years, the cap could provide savings of £80 to £90 a year for households with a prepayment meter.

It’ll also be easier for customers with debts to switch supplier.

Ending the four tariff rule

At the moment energy companies can only provide four different pricing structures. The rule was introduced to make things simpler, but it’s going to be scrapped to encourage more competition and bespoke tariffs.

Comparison sites will also be able to negotiate special tariffs direct with the energy companies, though they’ll no longer have to show every deal on the market.

Direct contact from companies

The government energy regulator Ofgem are going to look after a database of customers who have been on their suppliers most expensive prices for three years. At that point, the contact information will be shared with energy companies to get in touch by post and offer better deals.

What you can do now to pay less on your energy

These proposals are just that – proposals. If they are agreed they could help you pay less on your energy, but it’s all still in your hands, whether or not the proposals go through or not.

It’s actually very easy to find out if you’re on the best energy deal. The simplest option is to call your supplier and ask them. They have to tell you if it’s possible to save with them.

If you want to pay the least you possibly can, you need to do a search via one of the various comparison sites. Once you’ve found a deal that works for you, it’ll only take 17 days for the process to go through. You won’t see any difference to the gas and electricity you use or have a gap in service. You’ll just be paying less!

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