15.06.09 Are you willing to pay a loyalty tax?

If you were asked by your electricity provider to pay an annual loyalty tax of £111, would you do it? The chances are that you would be outraged at the very thought but it has been suggested that this is, in effect, what many of us are doing by declining to change provider and sticking with our local company. By having some misplaced sense of loyalty towards our incumbent supplier we are throwing money away.

It may seem bizarre but electricity suppliers have been so keen to muscle in on other providers’ local areas, offering good prices to tempt customers away from their regional supplier, that they seem to have forgotten all about the customers in their own area. Instead they depend on people’s apathy and disinclination to switch provider.

In exactly 50% of regions the incumbent supplier is the most expensive and even where this is not the case it is never the cheapest. All providers have a regional pricing policy meaning that customers pay according to where they live and Ann Robinson, of uSwitch, advises that consumers should use the postcode lottery to their advantage and shop around for the cheapest provider. Savings vary according to individual circumstances but average out at £58, with the maximum saving being £111.

Customers can also save money by opting for a dual fuel deal, an online plan or using a direct debit.

Earlier this month, British Gas announced its plans to shake up competition in the industry and said it would be offering the lowest prices in every region in the country.

« Go Back to Main Blog