Energy prices are constantly changing, and if you’re on a variable rate energy tariff, your gas and electricity bills will change to reflect this.
Variable rate tariffs, also known as a standard variable rate tariffs (SVRs), are the default price plans offered by energy suppliers, and often carry the most expensive rate for gas and electricity. You’ll find yourself on one of these tariffs if you’ve let a fixed deal lapse without switching, or if you’ve never switched energy provider.
Variable rate tariffs, like all energy contracts, charge a specific rate for the gas and electricity you use, but the rate on these deals can go up or down in line with fluctuations in the market, meaning there’s no protection against , energy price rises.
The rates offered on variable rate tariffs don’t go up and down randomly, they track wholesale energy prices and are adjusted accordingly. Ofgem rules state your supplier must give 30 days’ notice if it plans to put prices up, but a rise or fall in wholesale prices may not immediately be reflected in the rate you pay, if at all – energy providers can be notoriously slow in passing on any drop in prices.
Even if your energy supplier does cut your rate to reflect a drop in wholesale costs, the price difference might be so small that you barely notice it, as wholesale costs account for less than half of your energy bill. Here’s how a typical energy bill is broken down:
The table below shows the top variable rate tariffs currently available on the market. If you want to see how any of the following variable rate deals compare with the rest of the energy market, enter your postcode above and click the ‘Compare prices’ button.
|Supplier||Tariff||Average Annual Bill*|
|Flex4 12month Fixed Direct Debit||£834|
|Flex4 Standard Direct Debit||£834|
|UK Fixed 1 Year v1||£848|
|Together Fixed Jun 2018 v2||£874|
|OneSelect Secure 1 Year Fixed September 17||£884|
|TOTO Discount Variable Saver 2||£888|
|Online Tariff Mollie (12 month fixed)||£909|
**Based on usage of 3,100 kWh of electric per year and 12,500 kWh of gas per year. Shows average price across all regions. Assumes payment is made by Monthly Direct Debit. Only showing tariffs which are generally available across most of the UK
If you don’t want to tie yourself into a fixed-term deal, say you’re living in rented accommodation on a short-term letting arrangement, then a variable rate electricity and gas plan could be a good option.
On the other hand, if energy prices go up, you could end up paying significantly more than necessary for your gas and electricity, so it’s worth weighing up the pros and cons before you make a decision.
Switching energy provider is a quick and easy way to save money on your monthly gas and electricity bills. Make the switch with UK Power now
You’re not contractually bound to a variable rate energy tariff, which means there’s no end date – your rate simply goes up, down or stays static according to the market and price increases imposed by your supplier.
This means you’re free to switch to a better deal whenever you want, which you should do as soon as possible to lower your annual energy bills. Make the switch with UK Power and start saving today.