In 2018, households can change energy suppliers in 24 hours

As a result of the big six energy suppliers overcharging consumers by up to 5 per cent per year on their electric or gas bills, the government and the Competition and Markets Authority are putting new regulations in place. This will help families save money on their monthly energy costs by allowing them to switch to another, cheaper supplier in as little as 24 hours.

The results of the study by Competition and Markets Authority showed that most households were not on the correct tariff that would provide them the lowest rate on their energy bills. The CMA found that these families were paying up to £40 too much towards their electricity or gas bills. Many individuals were not either aware of the other tariffs, or they do not know how to change to them.

While there may be many reasons for this, one of the biggest is that consumers are just not selecting the least expensive tariff for their usage. People are not shopping around for the best deal, and as many as 30% of people admitted to this. Many individuals do not even know they can select a different electricity provider. There are millions of families that are still on the standard variable rate, even though there are cheaper plans available to them.

The CMA study came to the conclusion that the market for paying and finding the least expensive supplier for utility bills is not working for consumers. The current competition out there is not helping the most vulnerable households. In fact, even well off families are not taken advantage of the new pricing in place.

To help address this issue, consumers will be able to select a different supplier. The process will be simplified and also expedited, and the new rates can be selected within 24 hours. Note these changes from the government will not be effective until 2018.

It is expected that this competition, and the savings that result, will increase in 2018. This is good for consumers as it will push down the energy bills that many people have. It will also cause the companies to become more efficient as well as increase the service levels they provide to individuals.

This will be effective for all of the big 6 suppliers. They include British Gas, EDF Energy, SSE, RWE npower, E.ON and Scottish Power. While the exact savings for consumers will not be known until the changes are effective in 2018, it may come to as much as £1.2 billion a year, or £40 per home. The CMA estimates that 70% of UK households will be able to save money in 2018 from these changes to the energy market.

This will keep monthly utility bills down for all sorts of customers. The savings can also still be combined with the other financial aid programmes offered by the energy suppliers. Most of the companies do still offer financial assistance to the vulnerable, and locate the electric bill assistance schemes.