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How to Compare Electricity Prices & Save £££s

Illustration of a person comparing electricity prices

There are a multitude of electricity suppliers in the UK offering numerous variable and fixed-rate tariffs. With all these home energy options, it can be a bit overwhelming to try to compare electricity prices by yourself.

To help you out, we explain how to understand your energy bill and know what to look for in terms of unit rate, standing charges, billing options and exit fees, making it easier to know how to get the best deal on your electricity and start saving today.

Understand your electricity bill

Confused by your energy bills?Don't let confusion get in the way of saving money on your bills. Call us for a free assessment today. Call 0170 433 5575 or get a free callback now.

Switching your energy tariff is a surefire way to save you money and a quick and simple process if you know what to look for.

According to figures from Ofgem, around 70% of people find their electricity bills confusing. However, it’s important to understand terms such as ‘unit rate’ and ‘standing charge’ to ensure you’re getting the best deal possible. Let’s take a look at what these mean before comparing some of the electricity tariffs on the market today.

1. Unit Rate: the price of electricity

The unit rate refers to how much each kilowatt-hour (kWh) of energy will cost you. This is what makes up the biggest part of your electricity costs. The unit rate remains the same for the duration of a fixed-price contract, though will fluctuate according to wholesale electricity prices on a variable tariff.

What’s a kilowatt-hour?Electricity units are measured in kilowatt-hours (kWh) - that’s one kilowatt of electricity being used over an hour. You can usually find how much energy an electrical household appliance uses in watts on its packaging.

2. Standing Charge: a residential delivery fee

Electricity price calculator

The standing charge is a fixed price charge that is added to your bill to cover costs such as:

This cost is usually displayed on your quote as ‘per day’ in pence and remains the same for the duration of your contract.

£0 Standing Charge?

Some tariffs claim to offer no standing charge, but it would be wise to be wary of these. Generally, if an energy supplier offers no standing charge, its energy unit rate is much higher in cost than the average.

If, however, you have a property that is uninhabited for much of the year, this may be something to consider, as you will only be charged based on how much energy you are using.

3. Exit Fees

Contract lengths generally only apply to fixed-term tariffs. Technically, you do not have to fulfil your contract until the agreed termination date, however, failing to do so can incur an exit fee.

In most cases, if you wish to change providers or tariffs before the end of your term, you will have to pay a predetermined exit fee, usually in the range of £5 to £30, though this varies between suppliers.

There are some fixed-rate tariffs available in the electricity market that do offer the possibility to leave without having to pay an exit fee.

4. VAT

All electricity costs, discounts and incentives are subject to a standard VAT rate of 5%.

Paying your electricity bill

There are generally three options when choosing your payment method:

  1. Direct debit
  2. Cash or cheque
  3. Pay as You Go

Each of these has its benefits. However, we recommend that the majority of customers opt for direct debit. Not only is paying by direct debit more convenient, but most companies will even offer a discount for those who pay using this method.

How to compare electricity prices yourself

Now we know what charges our bill is made up of, we can begin to compare electricity tariffs by price. To get a better idea of annual costs, it's good to know your average electricity usage. We recommend using our handy energy consumption tool to get an accurate estimate of how much electricity you use.

Electricity prices also vary depending on where in the country you are. For our comparison, we’ll be using a home in the South-East of England with an average electricity consumption of 2,900kWh per year.

To get our final annual electricity price, we need to include:

  • Unit rate
  • Standing charge
  • VAT (5%)

Get free energy advice and switch to a great offer!Our trained advisors can find you a cheaper offer in just a few minutes. Call 0170 433 5575 or get a free callback now.

Below, we’ve calculated a fixed price electricity tariff with a unit rate of 17.604p per kWh and a standing charge of 23.72p per day. We’ve also included the standard 5% rate of VAT that applies to energy costs.

Sample Electricity Tariff
Electricity Annual Cost
Unit rate £0.17604 x 2,900 = £510.516
Standing charge £0.2372 x 365 = £86.578
Total electricity used in this period £597.10
VAT of 5% £29.86
Annual electricity price £626.96*

*Final costs are rounded.

Adding up to a whopping £626.96, we’re clearly paying far too much on this plan. This time, let’s try a Selectra exclusive tariff with the following conditions:

  • Unit rate: 15.64p per kWh
  • Standing charge: 19.32p per day
Selectra Exclusive Tariff 1
Electricity Annual Cost
Unit rate £0.1564 x 2,900 = £453.56
Standing charge £0.1932 x 365 = £70.518
Total electricity used in this period £524.08
VAT of 5% £26.20
Annual electricity price £550.28*

*Final costs are rounded.

As you can see, in this instance we could save £77 a year just by switching electricity suppliers. In other cases you may even be able to save up to several hundred, depending on the type of tariff you’re currently on.

Compare electricity prices the easy way with Selectra

Of course, going through the same process for each tariff can be incredibly time-consuming given the countless number of energy providers and electricity tariffs out there. Here at Selectra, we make things easy by doing the hard work for you, freeing up time for the more important things in life.

Armed with just a few details about yourself, your home and a rough idea of your energy consumption, our expert team of energy advisors compare electricity prices and tariff rates from across the market to find the best deal to suit you.

Give us a call today on 0170 433 5575 or get a free call back now to find out how much you could save. We’ll find you a fixed or variable tariff that works for your needs and also advise on whether direct debit billing or prepayment is the best option.

  • What details do I need when calling to compare electricity prices?
  • The name of your current supplier and tariff
  • Your average monthly or annual energy consumption in kWh or pounds
  • Your contract end date
  • You can find all of this information on your latest bill or through your current energy supplier’s online portal.

What do I need to do next?

If you like the sound of one of our exclusive tariffs we’ll set you up with a switching date. Your new supplier will take care of just about everything to do with the changeover from your current electricity provider.

You won’t need to install any new equipment, unless you’re moving from a prepayment meter to a direct debit tariff or vice-versa, or if you’re having a smart meter installed. This is usually covered by your new energy supplier and won’t cost you a penny. All that’s left to do is put your feet up and watch the savings roll in!

How long will it take to switch over?

Your switch will take no more than 21 days, including a 14-day cooling-off period. During these 14 days, you’re free to cancel the switch and stay with your current supplier if you change your mind.

What types of electricity tariffs do you offer?

The two principal tariff types offered by energy providers are fixed-rate and variable.

Variable tariffs will adjust according to the wholesale price of electricity. This means your bill could get cheaper, though it's more likely to increase over time.

If you’re on a fixed tariff the price of electricity per kWh will not change for your contracted duration, leaving you safe in the knowledge that your bills are not going to soar at any given moment.

Dual fuel: electricity and gas together

A dual fuel tariff is a plan where both your gas and electricity are supplied by the same energy provider. This means just one bill to pay for both types of fuel, with many suppliers offering discounts for signing up for both fuels.

Green electricity

With climate change increasingly playing a part in our choices as consumers, green energy tariffs offer the eco-conscious customer peace of mind that they’re doing their bit for the environment by using energy from renewable sources, such as wind, solar power and hydropower.

Green tariffs have previously been more expensive than those that rely on dirty fossil fuels, though this is rapidly changing, with many providers offering renewable electricity plans at the same price - or even cheaper in some cases.

Prepayment electricity

Customers on prepayment electricity tariffs pay for their energy ahead of time, much like a pay-as-you-go mobile phone. Prepayment tariffs use a special kind of meter that is topped up by key, card, token or online for those with a smart prepayment meter.

Prepayment electricity tariffs are generally among the most expensive, though they could be a good option for those who like to set a weekly budget and pay for their energy bills in advance.

Want to get a PAYG tariff for your gas and electricity?Call us to find out how to switch without any hassle or expensive equipment changes. Call us for a free assessment today. Call 0170 433 5575 or get a free callback now.

Economy 7 and Economy 10: off-peak electricity

Economy 7 and Economy 10 are electricity tariffs that have a cheaper off-peak rate at night and a more expensive rate during the daytime. This may suit those who use storage heaters which charge overnight.

Both Economy 7 and Economy 10 require installing a differential rate meter which offers two electricity prices. Although Economy 7 and Economy 10 meters are rapidly becoming a relic of the past, you can still find tariffs with a limited number of suppliers, on both prepayment and direct debit options.

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