Major energy firm launches new energy tariff that ‘guarantees’ you pay less than price cap by £50 – but is it worth it?
A MAJOR energy supplier has announced a new tariff that “guarantees” you pay less than Ofgem’s price cap by £50.
EDF has launched a new tariff, EDF Ensure, which is a one-year, fixed-term tracker deal set £50 below the July 1 price cap, at £1,518.
Through the deal, customers will also get a £25 discount applied to their standing charges.
Standing charges are fixed daily charges levied on customers’ bills to cover the fixed cost of supplying energy to homes.
By discounting standing charges as opposed to the unit rates, all EDF customers who sign up to Ensure will see the same financial benefit.
This also applies to low-energy consumers and those on a Pay As You Go meter.
The tariff will launch discounted against the July 1 price cap level, offering an annual average cost of £1,518 until the next Ofgem price cap change on October 1.
It follows the company’s launch of a deal it claimed was the “UK’s cheapest” in March this year in a bid to entice new customers, offering them £347 off the price cap.
Rich Hughes, director of retail at EDF, said: “While the price cap will come down from July, it is expected to increase once again this Winter.
“Our new tariff will guarantee that customers who have already cut back or made changes to improve energy efficiency will pay proportionately less.
“Standing charges have increased significantly over the previous couple of years and this new tariff is another way we are helping customers save cash and carbon.”
Last winter, EDF invested £7.5m by rolling back standing charges for 250,000 of its most vulnerable customers after charges rose by 55% since April 2021.
The energy provider also created a dedicated tracker webpage to inform all customers of the latest information on cap predictions.
The information page is updated every Tuesday.
How to sign up for EDF Ensure
To sign up for the tariff, customers will need to already have a smart meter or agree for one to be installed.
Smart meters are free to be installed and provide a range of benefits including EDF’s exclusive Energy Hub platform where customers can access a personalised view of their energy use.
The tariff is available to new and existing customers on direct debit, cash cheque and pay-as-you-go payment plans and is backed by zero-carbon electricity.
EDF said it found that customers who use its Energy Hub to understand their usage are able to actively reduce their bills by up to £41 a year while also reducing their carbon footprint.
Customers and their friends can also get an additional £50 off of their bill by signing up to ‘Refer a Friend’ on their online account.
What energy bill help is available?
THERE'S a number of different ways to get help paying your energy bills if you're struggling to get by.
If you fall into debt, you can always approach your supplier to see if they can put you on a repayment plan before putting you on a prepayment meter.
This involves paying off what you owe in instalments over a set period.
If your supplier offers you a repayment plan you don’t think you can afford, speak to them again to see if you can negotiate a better deal.
Several energy firms have grant schemes available to customers struggling to cover their bills.
But eligibility criteria varies depending on the supplier and the amount you can get depends on your financial circumstances.
For example, British Gas or Scottish Gas customers struggling to pay their energy bills can get grants worth up to £1,500.
British Gas also offers help via its British Gas Energy Trust and Individuals Family Fund.
You don’t need to be a British Gas customer to apply for the second fund.
EDF, E.ON, Octopus Energy and Scottish Power all offer grants to struggling customers too.
Thousands of vulnerable households are missing out on extra help and protections by not signing up to the Priority Services Register (PSR).
The service helps support vulnerable households, such as those who are elderly or ill, and some of the perks include being given advance warning of blackouts, free gas safety checks and extra support if you’re struggling.
Get in touch with your energy firm to see if you can apply.
Is the new tariff worth it?
Ben Gallizzi, energy expert at Uswitch.com, said the new tariff is an “innovative product” which could be “a viable option” for some households.
However, he said customers should keep in mind that signing up to this tracker tariff could make it harder to budget as the price cap changes every three months, making future predictions less reliable.
The expert said customers also need to be aware of the fact that they can only sign up for this deal if they’re willing to have a smart meter.
Plus, he added that there is also a £50 exit fee if you decide to switch from this tariff and leave early in case you find a better deal.
He told The Sun: “It’s encouraging to see another innovative product like this coming to market, and it could be a viable option for some households.
“EDF’s new tracker tariff is priced £50 below the July 1st price cap for the average household, offering an annual cost of £1,518.
“However, with the price cap expected to rise again in October the price you pay would increase in line with this, although still offering the £50 saving.
“A tracker tariff could be harder to budget for, as the price changes every three months and future predictions are less reliable.
“But with prices set to rise again in winter, now may be a good time to consider a fixed rate deal that provides the peace of mind that your payments will remain consistent for a year.”
What’s the Ofgem price cap?
In May, energy regulator Ofgem confirmed the new price cap, which comes into effect on July 1.
The cap will fall from the current rate of £1,690 a year to £1,568 – the lowest level in two years.
It means the average household paying by direct debit for dual fuel will see their annual bill drop by £122 – a 7% fall.
But bear in mind the exact amount you pay can be higher or lower than this cap depending on your usage, and the cap is reviewed every three months.
Only standards and variable tariffs are affected by the price cap, impacting 29 million households, according to Ofgem.
Unit rates will fall while standing charges – a fixed daily amount – will stay the same.
Free cash schemes if you're struggling
Many of us are still struggling with the high cost of living - but there's help you can get.
New or expectant parents can get up to £442 a year to spend on food through Healthy Start scheme.
Some new parents can get £500 via the Sure Start Maternity Grant. The money is designed to help you cover the costs of having a child.
Councils also offer support through the welfare assistance schemes, to help cover the costs of essentials, from buying new furniture to food vouchers.
The amount you can get varies but an investigation by The Sun found that hard-up Brits can apply for help worth up to £1,000.
Discretionary Housing Payment is a pot of money handed out by councils to those struggling to keep a roof over their heads.
A scheme is available for those who find themselves unable to cover housing costs, though the exact amount varies as each local authority dishes out the cash on a case-by-case basis.
Many energy forms offer grants to help cash-tight customers. The exact amount varies depending on your supplier and you circumstances, but could be as much a £2,000.
It means those with higher usage will benefit more from falling prices.
The energy regulator said the price a supplier can charge for gas will fall from 6.04p per kWh today, to 5.48p from July 1.
The price of electricity will fall from 24.5p per kWh to 22.36p, Ofgem said.
Standing charges, which cover things like maintaining the network and operational costs, will drop to 31.41p from 31.43p a day for gas and from 60.1p to 60.12p for electricity.
Overall, energy bill standing charges will remain at £334.
The price cap also varies depending on the way you pay.
The £1,568 price cap from July will apply to those who pay by direct debit.
For those on prepayment meter it will be £1,522 and it will be £1,668 for those paying on receipt of bills.
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