Switching supplier or tariff is one of the rare energy savings that asks nothing of your lifestyle. You do not have to turn anything down, wear an extra jumper, or change a single habit. You just do a bit of admin once and keep paying less. The catch is that the headline price per unit is only part of the story, and the cheapest deal for a heavy user is not the cheapest for a light one. This guide explains how to compare the right things, what fixed and variable really mean, how a switch actually works behind the scenes, and how to avoid quietly rolling onto an expensive default.
The short answer. Do not compare on the unit rate alone, because a low unit rate can hide a high standing charge, and the best deal depends on your own usage. Compare the total estimated annual cost using your actual yearly consumption in kWh, which is on a recent bill. Decide between a fixed tariff (certainty, usually an exit fee) and a variable one (moves with the market). Switching is painless, nothing gets cut off, and the same gas and electricity flow through the same pipes. Recheck when any fixed term ends rather than rolling onto the default rate.
Look past the unit rate
The number suppliers shout about is the price per kWh, but that on its own tells you almost nothing about your bill. As covered in understanding your energy bill, you pay two things: the unit rate and the daily standing charge. A tariff with a tempting low unit rate can carry a high standing charge, and vice versa.
Which one matters more depends on how much you use. A heavy user benefits most from a low unit rate, because the standing charge is a small slice of their large bill. A light user is the opposite: the fixed daily charge is a big chunk of their total, so they should weight the standing charge more, as standing charges explained sets out.
The only meaningful comparison is the total estimated annual cost for your own usage, not the unit rate alone. To work that out you need one number: your actual annual consumption in kWh for each fuel.
Find your own usage first
Before you compare anything, dig out your annual consumption in kWh. It is on a recent bill, on the annual statement your supplier must send, or in your online account. You want roughly how many kWh of electricity and how many of gas you use in a year.
If you cannot find it, a rough estimate still beats nothing. The headline Ofgem cap of £1,663 a year assumes a typical household uses around 2,700 kWh of electricity and 11,500 kWh of gas. Compare your own figures against those to see whether you are a light, average or heavy user, which shapes which tariff suits you.
Here is how the same two tariffs land for different users, to show why your own usage decides it.
| Tariff (electricity only) | Light user (1,500 kWh) | Heavy user (4,500 kWh) |
|---|---|---|
| Low unit rate, high standing charge (24p + 65p/day) | £597 | £1,317 |
| Higher unit rate, low standing charge (27p + 45p/day) | £569 | £1,379 |
| Cheaper option | Higher unit rate | Low unit rate |
Illustrative tariffs only, not real deals. The point is that the cheaper tariff flips depending on your usage. Always compare total annual cost, not the unit rate.
Fixed or variable
Tariffs come in two broad shapes, and the right one depends on what you value rather than which is cheaper today.
A fixed tariff locks your unit rate and standing charge for a term, usually twelve or twenty-four months. You get certainty and protection if wholesale prices rise during the term. The trade is an exit fee if you leave early, and the risk that prices fall and you are stuck above the market.
A variable tariff moves with the market, typically tracking the Ofgem cap. It is cheaper when prices fall and painful when they climb, with no exit fee to leave. The standard variable tariff is what you land on by default, and it is rarely the cheapest option going.
Which wins depends on where prices are heading, which nobody truly knows. Fix if you value a predictable bill and prices look set to rise; stay variable if you want flexibility or think prices will ease. The mechanics of the cap that variable tariffs track are in how the energy price cap works. If you have an electric car or storage heaters, also look at time-of-use tariffs and Economy 7 and night rates, which charge different prices at different times of day.
How switching actually works
People put off switching because they imagine disruption. There is none. The switch is almost entirely paperwork happening in the background.
- Your supply is never cut off. No engineer visits, nothing is disconnected, and there is no gap.
- The energy is identical. The same gas and electricity flow through the same pipes and wires. Only the company that bills you changes; the physical supply is unaffected.
- You give a meter reading on the switch date. This lets the old and new suppliers split the account at the right point, so you pay the old rate up to the changeover and the new rate after.
- It takes a couple of weeks. The process typically completes within around two weeks, and there is a short cooling-off period in which you can change your mind.
If you have a smart meter, be aware it sometimes loses its smart functions after a switch and reverts to needing manual readings, which usually sorts itself out but is worth watching.
Things to check before you commit
Once a comparison throws up a cheaper deal, a few checks stop you swapping a known quantity for a worse one.
- Exit fees. If you are on a fixed tariff, leaving early usually triggers a fee per fuel. Weigh the saving from switching against the fee. Within the last few weeks of a fixed term, suppliers generally cannot charge the exit fee, so timing the switch to the end of the term avoids it.
- Direct debit versus other payment. The headline figures almost always assume monthly direct debit, which is the cheapest way to pay. Paying on receipt of bill or by prepayment can cost more, so compare like for like.
- Dual fuel versus separate. Buying gas and electricity from one supplier is sometimes cheaper and sometimes not. Comparison tools can show both, so do not assume bundling always wins.
- Your direct debit amount. A switch resets your monthly payment based on an estimate. Check it is sensible against your real usage so you do not build a large credit balance or a debt. Submit accurate readings to keep it honest.
- Service, not just price. The cheapest supplier with poor billing and unreachable support can cost you time and grief. A few pounds is not worth months of wrangling over a wrong bill.
If you are a tenant rather than an owner, your right to switch depends on whether you pay the supplier directly, which is set out in saving energy when renting.
Use a genuine comparison, and do not coast onto the default
To see real, current deals, use a reputable comparison service that lists the whole market and shows the total annual cost for your usage, not just a unit rate. This site deliberately does not publish a live tariff league table, because prices change constantly and vary by region, and a stale table would mislead you more than it helped. Anyone who shows you a fixed list of named deals is showing you a snapshot that may already be wrong.
Treat any comparison as exactly that, a snapshot for today. The most expensive mistake is letting a fixed deal expire and rolling silently onto the supplier's default standard variable tariff, which is rarely the best rate. Diarise the end date of any fixed term and compare again a few weeks before it lapses. That single habit, rechecking at renewal rather than drifting onto the default, saves more over the years than chasing the absolute cheapest deal each time.
Switching is the laziest worthwhile saving there is. For the savings that come from using less rather than paying less per unit, the electricity hub is the place to start.