Ofgem publishes supplier standard variable tariff league table
Press release
- Publication date
- Industry sector
- Supply and Retail Market
- Ofgem’s league table shows SSE, British Gas and E.ON have the highest proportion of customers on standard variable tariffs
- Suppliers need to do much more to get all customers a better deal
- Ofgem plans to extend vulnerable safeguard tariff to 2 million more households while working with Government to implement wider safeguard tariff
SSE has come bottom of Ofgem’s new league table ranking the ten largest suppliers on how many customers on poor value standard variable tariffs they have.
Together with British Gas, which comes second from bottom, the two suppliers account for over half of all customers on these poor value deals.
The table also shows that standard variable tariffs are still around £300 more expensive than the cheapest deals on the market.
Of the ten largest suppliers shown, the three suppliers with the smallest proportion of customers on standard variable tariffs are all independent suppliers – First Utility (which comes top), followed by Ovo Energy and Co-Operative Energy respectively.
The decline in the overall number of customers on these tariffs is accelerating thanks to record switching rates in 2017.
As of the end of September, 57% of customers who are not protected under Ofgem’s prepayment safeguard tariff, were on standard variable tariffs. This compares to 59% in April of this year.
However, suppliers, particularly large suppliers with the highest proportion of customers on poor value standard variable deals, still need to do more to help them get a better deal.
In recent months, some large suppliers have announced plans to use new Ofgem rules to roll customers automatically onto fixed default deals instead of a standard variable tariff as part of wider initiatives by suppliers to phase out these tariffs.
While such moves are a step in the right direction, they must lead to inactive customers genuinely benefiting from a significantly better deal, and not just being put on a rebranded poor value tariff.
Meanwhile, Ofgem today set out plans to extend a safeguard tariff to more vulnerable customers on standard variable and default tariffs to protect them from overpaying for their energy for next winter.
From February, 1 million vulnerable households will be covered by Ofgem’s safeguard tariff. Ofgem is proposing to extend protection to another 2 million vulnerable households before next winter.
Separately, the Government has published draft legislation for a temporary safeguard tariff for all standard variable and default tariffs, which Ofgem will implement.
The Government’s safeguard tariff will replace Ofgem’s vulnerable safeguard tariff as these vulnerable customers will be covered by the wider protection.
If the Government’s safeguard tariff is in place before winter next year, Ofgem’s vulnerable safeguard tariff will also not need to be extended as proposed.
Dermot Nolan, chief executive of Ofgem, said: “Ofgem’s league table shows which suppliers have the most work to do to get all their customers a better deal.
“Some of the larger suppliers have a significantly lower proportion of customers on poor value standard variable deals than SSE, British Gas and E.ON in particular. This shows it is possible to help more of these customers get a better deal and it is unacceptable that so many are still paying too much for their energy.
“Ofgem is protecting some of the most vulnerable in society from overpaying for their energy by extending our safeguard tariff to vulnerable households. We are also working alongside the Government to implement its planned wider safeguard tariff for all customers left on default deals such as standard variable tariffs.
“In the meantime, we will continue to press suppliers to get all their customers a better deal.”
Notes to editors
- SVT league table
- Consultation on providing financial protection to more vulnerable consumers
- When consumers get price protection from Ofgem:
- Next year Ofgem will publish additional analysis on whether fixed deals, including default fixed deals suppliers automatically roll customers onto, offer good value.
- Ofgem is continuing its work to make it easier for consumers to engage in the market and get a better deal. Ofgem has today published its decision on personalised estimates to change the way that personalised estimates of the annual cost of energy tariffs are calculated for customers to better help them shop around and compare deals. The standardised method that suppliers and price comparison websites currently use does not work for some of the new tariffs and discounts available in the market and does not allow suppliers to tailor the estimates to different customer preferences. In future, suppliers and comparison sites will be able to develop their own methodology for estimating a customer’s annual costs. This must be personalised and based on the individual’s consumption, clearly explained, and used consistently to compare tariffs on a like-for-like basis.
Further information
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