EDF has launched a new tracker energy tariff that works out £50 a year cheaper than the Ofgem price cap by discounting the much-hated standing charges.
EDF Ensure is a one-year, fixed-term tracker tariff with a £25 per fuel discount applied through standing charges. Standing charges are fixed daily amounts that you have to pay, no matter how much energy you use. The tariff is discounted against the July 1 price cap, but as EDF Ensure is a tracker tariff, it will change every three months in line with the price cap. The price cap is set to fall to £1,568 a year, meaning someone with typical energy use will pay £1,518 through EDF Ensure.
However, it isn’t quite as clear cut as this. These figures are based on someone with typical usage - so your actual energy bill can be higher or lower than this, depending on how much gas and electricity you use. Ofgem estimates that the average household consumes 2,700 kwh of electricity and 11,500 kWh of gas over 12 months. Unit rate prices also vary by region, so your location can also affect your bill, and finally, there are different rates for prepayment customers and those who pay on receipt of bill.
The headline price cap rate is for someone with typical use who pays by direct debit. Rich Hughes Director of Retail at EDF, said: “While the price cap will come down from July, it is expected to increase once again this Winter. Our new tariff will guarantee that customers who have already cut back or made changes to improve energy efficiency will pay proportionately less. Standing charges have increased significantly over the previous couple of years and this new tariff is another way we are helping customers save cash and carbon.”
To sign up to the tariff, customers will need to have already, or agree to have, a smart meter to be installed. The tariff is available to new and existing customers on direct debit, pay on receipt of bill and pay as you go customers. If you leave before the end of the year, you'll have to pay £25 per fuel early exit fee.
Martin Lewis' MoneySavingExpert.com team published recent analysis which showed this tariff could work best for lower energy users. MSE said: "The flat standing charge discount on EDF's Ensure tariff is especially powerful for lower users (say, under £100 a month). It's an easy way to cut bills without cutting your usage." For high energy users, MSE said the E.on Next Pledge tracker tariff, which promises to remain roughly 3% below the price cap, could be a better deal.