Loyalty costs: Energy consumers sticking with standard variable tariffs rack up combined bill of £3.6bn a year

 
Francesca Washtell
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It might keep your lights on, but that standard variable tariff could be straining your wallet (Source: Getty)

Loyalty costs when it comes to energy bills, according to new research from comparison site uSwitch.

Customers staying loyal to their supplier’s standard tariff without looking for the cheapest deal are paying a combined £3.6bn more for their energy each year than they need to.

British Gas has the most standard variable customers, around 6.6m people or 74 per cent of its customer base. But their loyalty is costing them a combined £1.1bn extra a year, or extra £165 per person uSwitch found, than if they switched to the cheapest deal on the market.

Rival Big Six energy firm SSE has the highest proportion of customers on standard variable tariffs, however, at 91 per cent of its consumer base.

Read more: This is the appliance British Gas is blaming for hiking your energy bills

ScottishPower has the lowest proportion of standard variable customers, at 50 per cent.

"It’s hard not to look at these figures and come to the conclusion that energy companies are not doing enough to get their most loyal customers off expensive standard variable tariffs and onto cheaper fixed deals. This is evidence that loyalty doesn’t pay when it comes to your energy bills," said Claire Osborne, energy expert at uSwitch.

Read more: Bills may jump as wholesale electricity prices soar in November

"Energy companies must do a lot more to help their customers understand the deal they are on and what the alternatives are. The Competition and Market Authority’s package of remedies will provide more of an incentive for companies to do this, so it needs to be implemented now and given time to succeed so that competition can drive greater choice, better customer service and reduce bills."

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