One of the UK’s Big Six energy provider British Gas has recently launched the cheapest deal among the largest suppliers in more than three years. The offer comes amid the continued energy price cuts in the current market.
Martin Lewis, a money-saving expert, shared on Good Morning Britain that British Gas customers can save an average of £315 on the supplier’s new deal, which is fixed throughout the year. He further added customers could save as much as £1,000, seeing as no surprise price hikes could happen within the first year.
Cheapest Large Supplier Tariff
British Gas’ Energy Plus Protection Mar 2021v2 is the new tariff that is touted as the most affordable for any Big Six supplier since October 2016. Dual-fuel households on typical use can expect average energy costs of £839 per year. The last cheapest deal was also from British Gas via the now-defunct Sainsbury Energy, wherein the typical energy use cost £796 per year.
The tariff is made available on gas supplier comparison sites that are approved by the energy regulator Ofgem. Consumers who avail can also get a £25 cashback on top of the deal being the cheapest for large suppliers today.
Money-saving guru Martin Lewis said the supplier has relaunched this inexpensive tariff and made it cheaper since it only costs £839 per year on average. This price is £315 less than the average standard tariff (average of £1,155 per year) of the Big Six suppliers, which includes that of the firm itself.
Both existing and new dual-fuel customers will be able to get the deal. Depending on the location, customers can get the contract for even less. It’s also beneficial for the customers to compare the tariff against offerings from other suppliers to inspect which deal is the most suitable for their preference.
The Energy Plus Protection Mar 2021v2 comprises 100% green electricity and free heating insurance for a year.
Comparing Big Six Prices
While British Gas delivers the cheapest Big SIx deal in the market, other big suppliers also offer competitive rates to attract customers. Scottish Power has the second cheapest deal at £843 per year, followed by EDF Energy with an £850 a year deal. Both suppliers provide this tariff for new and existing customers.
E.on’s standard tariff is a few pounds higher at £874 per year, while SSE offers £946 a year. Both rates are for new customers only. Npower, on the other hand, takes the most expensive deal out of the Big Six, with its tariff amounting to £1,018 on average per year for both existing and new customers.
The current overall cheapest tariff in the industry today is delivered by Outfox the Market for only £791 per year of typical use. However, the supplier lags in customer service polls and the like, which means it might not be the ideal choice for many.
However, Lewis reminds that the British Gas tariff is not available in Northern Ireland or for prepayment customers.
Reason for Low Prices
British Gas might be making rounds as it introduced the cheapest Big Six tariff, but the industry has seen some remarkable cuts in energy prices over the past year.
One of the primary reasons for this occurrence is the decrease in wholesale prices. For this instance, British Gas was able to offer a much-lowered dual-fuel deal due to the steep decline in oil prices earlier this month. The issue stemmed from the price war raged by Saudi Arabia that caused crude oil prices to take a massive slump following failed talks with Russia.
The proposal to reduce oil production did not come through even though demand has seriously gone down due to the deadly coronavirus outbreak.
According to expert analysts at Cornwall Insight, crude oil prices in the global market has gone down to more than a third of previous prices, which is the lowest since February 2016. With low gas prices on top of the oil price decline, the UK wholesale market prices for gas and electricity would likely go down further, which would consequently lower retail prices.