What Is a Standard Energy Plan & Am I On One?
What is a Standard Energy Plan?
A standard energy plan, also known as a standard variable rate tariff, is an energy supplier’s basic plan. Often, the word ‘standard’ will be included on your bills, but this is not always the case. Unlike a fixed rate plan, the unit energy price on a standard variable tariff can go up or down over time.
A standard energy plan is the one that any new customer (for example, one who has just moved to a new home) who does not request an alternative will automatically be put on. You will also likely be rolled onto a standard energy tariff if you do not switch supplier or arrange a new fixed rate deal after an existing fixed rate deal comes to an end.
The Benefits of a Standard Variable Rate Energy Plan
The only thing that can be described as a positive when it comes to standard energy plans is that you will be free to switch at any time. Unlike with some fixed rate energy plans, you will not be tied in for a certain length of time. There will not be an exit fee to pay if you want to switch, no matter when you choose to do so.
The Down Sides to a Standard Energy Plan
In a standard variable rate energy deal, you will be the first to be affected when an energy supplier announces a price hike. If (when) energy prices go up, your bills for energy will also increase. This can leave customers vulnerable. Unfortunately, these tariffs are also already amongst the most expensive options that are on offer. So when you are on a standard energy plan, it is likely that you will be paying more for your energy than someone who is on a better deal.
Am I on a Standard Energy Plan?
It is likely that you are on your energy supplier’s standard energy plan if:
- You have never switched energy supplier and have been with the current supplier for quite a long time.
- You have just moved home and did not request a particular deal from the supplier.
- You had a fixed rate plan that has expired, and you did not arrange a new fixed rate deal. (While new Ofgem rules are changing this, customers can currently automatically be rolled onto a standard variable rate when their fixed rate plan comes to an end.)
Some suppliers of electricity and gas are now rolling customers onto fixed rate plans on a temporary basis. These ‘temporary tariffs’ do have a fixed energy price (usually locked in for a year). However, these tariffs are extremely similar to standard plans, and are likely to be just as expensive. While these types of plan will protect you from energy price increases during their term, it is almost certain that they will not be the cheapest plans you can get. If you find that you are on one of these plans – it will likely make sense for you to use Money Pug’s comparison service and move to a cheaper deal straight away.
To check to see if your plan is standard, take a look at your energy bill. If you see the word ‘standard’ then of course you will know that you are. You may also see the word ‘variable’ when you are not on a fixed rate deal. As mentioned above, however, not all standard energy plans will be signposted with these words. For example, while big six energy companies EDF Energy, SSE and Scottish Power all use the word standard, E.ON’s standard energy plan is called the ‘E.ON Energy Plan’.
If in doubt, compare prices on Money Pug’s website. If you find that there are a number of deals that are a lot cheaper, then it is likely that you are currently on a standard energy plan. It is most definitely time to consider a switch!
What to Do If You Are on a Standard Energy Plan
The first thing to do if you find that you are on one of these expensive energy plans is to check on Money Pug’s comparison site to see how much you could save by switching plan or supplier. Shopping around and being fully informed is crucial to getting the best deal for you. By comparing the prices of standard plans with other offerings, you will begin to see that you could save a lot of money by switching to a better deal.
Fixed rate energy plans in particular can offer excellent value for money, and you will be protected from energy price increases during the period of your plan. This can not only keep money in your pocket, it can also give you some valuable peace of mind, since you will not fall prey to sudden price hikes on your energy bills.
Money Pug is here to help. Check out our other handy guides, and compare today to start saving.
Compare through MoneyPug today! and SAVE Money