Finally, some good news for our gas and electric bills. Energy provider Engie has announced that it will automatically ‘rollover’ its customers onto its lowest priced tariff after their fixed-term contract ends – hurrah!
What usually happens after your fix ends?
When it comes to being savvy with our money, we’ve been told time and time again that we should switch energy providers to find the cheapest deal. After all, the gas and electricity coming into our homes is the same, no matter who we choose to supply them, so why pay more?
And it seems we’ve been listening to this advice and switching in abundance, with Ofgem reporting that, at the end of last year, switching was at a 4.5 year high.
When switching, many of us opt for fixed-term contracts, which offer us the security that our gas and electricity cost per kilowatt hour, should remain at a fixed price for a defined time period. This proved to be a great thing for those of us who locked in, only to see the prices rise and the words ‘big freeze’ being bandied about in the press, safe in the knowledge that we wouldn’t be seeing an increase in prices until after the winter at the earliest.
There was only one problem in our smug, cheaper gas and electric bubble: when our tariff ended, we would be put on the dreaded (as it’s usually much more expensive) standard variable tariff. Time to start the deal researching process all over again, or face some potentially hefty bill increases.
So, why is Engie’s ‘rollover’ deal so good? For customers whose fixed-term contract with them ends, Engie will not place them onto a standard variable tariff but onto their cheapest tariff.
Of course, Engie’s cheapest tariff doesn’t necessarily mean it will be the cheapest tariff out there. But for those of us who haven’t had a chance to find another fix, it means that we won’t be automatically placed onto the (usually) more expensive standard tariff.
Additionally, Engie won’t make you pay any exit fees on the rollover tariff, so you can still leave when you want, at no extra cost, if you find a better deal.
Plus 100% renewable electricity
Engie has said that all of its domestic tariffs will offer 100% renewable electricity, without any additional costs. It will also have a green tariff, which will offer customers 100% green electricity and gas.
Tracker tariff due to launch this summer
In another bit of potentially good news for UK customers, Engie has also said that it is planning to launch the Engie Tracker, which will base its prices on the wholesale costs of gas and electricity.
This means that, in theory, customers on this tariff should be able to benefit from any decreasing prices in the wholesale market. However, the price of your gas and electric would also increase if the wholesale market costs rose, so this deal may not be for everyone.
However, hopefully, what it will offer is the transparency in pricing that so many of us want to see more of from our energy suppliers.
Engie’s tracker tariff isn’t the first of its type to launch in the UK. Relatively new energy firm Octopus, announced a deal that, along with an app, would enable its customers to see how much profit it was making, as well as the wholesale prices it had paid for the electricity and gas.
This type of tariff seems to be a shift in focus for energy providers in the UK, where more importance is starting to be placed on winning back consumer trust (and about time).
Who exactly is Engie?
Whilst many of us may not have heard of Engie, it is by no means a new kid on the block. This French company already powers big businesses across five continents and is now launching on the UK domestic market.
It is one of the biggest new energy providers to enter the UK market for a number of years and is well-positioned as a rival to the ‘big six’ energy providers.
Energy prices and the general election
Always big news, energy prices have made even more headlines in recent weeks, with Theresa May reportedly promising a cap on energy prices. However, this didn’t seem to appear in the Conservative party’s manifesto, starting speculation in the press that Theresa May could ‘water down’ these promises.
Whether or not the price cap will come about remains to be seen (whether it’s a good idea or not is a whole other matter), but one thing is for sure – energy prices and the tariffs energy companies are offering us, will remain an important issue, both politically and for customers, well into the future.
Always compare costs…
Whilst this is definitely a move in the right direction for the domestic energy industry in the UK, it doesn’t mean that we should all switch to Engie and then simply sit back and relax.
There is no ‘right deal’ for everyone, so it’s important to always compare the different deals that energy providers are offering.
This can be done in a few minutes online, via comparison websites such as uswitch.com.
Will the ‘big six’ follow?
Whether the ‘big six’ will follow and we’ll see more tracker and rollover-type tariffs, remains to be seen.
In a way, it would seem mad for them not to. This type of more transparent and fair pricing, where we are placed on the ‘best possible’ tariff that a provider offers when our fixed deal ends, is surely what we, as customers, want.
In reality, this may just be another small step in the right direction – but if enough of us vote with our feet and continue to switch in order to get the best deal, it can only be a good thing, for our wallets and the energy industry as a whole.