Energy bills still baffle us

14 March 2014

Simplified energy bills are still baffling consumers, a new Which? investigation has found.

Only 35% of people were able to spot the cheapest deals of the Big Six energy companies despite the introduction of standardised tariffs by regulator Ofgem.

As part of the investigation, consumers were presented with bills made up of a flat-rate standing charge and a unit rate, but two-thirds of consumers were still unable to identify the best deal.

Worryingly, 31% picked the wrong tariff completely and 34% either didn't think it was possible to work out what was the cheapest deal or didn't know how to.

Four in ten (41%) used a calculator or spreadsheet to help with the maths, yet still only 50% managed to work out what was the best deal.

In April, the Tariff Comparison Rate (TCR), which will display tariffs based on what a medium energy user would pay for their gas and electricity, will also be introduced in attempt to simplify bills further.

However, the survey revealed only 8% found the TCR display easier to understand and nearly two-thirds of people chose the supplier with the lowest TCR figure - even though this wouldn't have provided the cheapest deal for a low or high energy user.

Compare energy prices and switch provider

Improve trust

Which? is calling on the government and energy companies to do more to improve customers' trust in the market and is championing an even simpler pricing format of a unit rate with no standing charge.

The survey found that 81% of people were able to pick the cheapest deal when presented with this simplified bill.

Executive director Richard Lloyd said: "In spite of Ofgem's tariff reforms to simplify the market, consumers are still failing to spot the cheapest deal because energy pricing remains too complicated."

In response to the findings, Ofgem's consumer partner Phillip Cullum said it was "confident" the reforms would help consumers find the best deals.

Add new comment