Researchers yesterday revealed the top 10 deals last month – many of them fixed – offered 25 times less of a buffer from the cost ceiling than in September 2020. Data analysts Cornwall Insight said the £11 saving is the narrowest the gap has been since the cap was introduced in January 2019. The firm’s James Mabey said: “The record-high wholesale prices and the resulting energy crisis has taken its toll on the energy tariffs available, with domestic tariffs seeing substantial price increases over the summer.
“Usually, a rise in the default tariff cap by Ofgem would widen the gap between the cap and the lowest deals, making switching more worthwhile.”
And he warned there is little chance of making savings any time soon, saying: “With wholesale prices remaining well above typical levels, it is not clear the savings gap will reopen. This is compounded by the fact that many tariffs have been removed from the market.
“The drastic reduction in tariffs available suggests the switching landscape will retain a low level of switching until the gap between delivered costs falls below the price cap once more.
“This will either be when the price cap is amended in April or when current highs in the wholesale market abate.”
The majority of the cheapest tariffs were fixed deals, which are not covered by the price cap rules.
But these are now becoming more expensive than the limit – designed to cushion people from soaring bills – which sits at £1,277.
This is £139 higher than the previous £1,138 ceiling, which ended last month. A large number of suppliers have gone bust as they can no longer pay the increased cost for wholesale gas.
As a result, the best tariff available on the market has remained above £1,000 per year for the last six weeks.
The cheapest 10 deals in April meant an average £906-a-year bill for a typical dual fuel user.
The equivalent figure stood at £1,127 as of September 27 – a hike of 24.3 percent.
It is feared tariffs will become even more costly with an expected price rise of £300 when the cap comes up for review in April.
Research by Electralink, another data analyst, found 399,000 customers changed supplier in August, 24.7 percent down on 2019 and the lowest since August 2016.
Gas supplies have been squeezed because a cold winter in Europe last year raided stored supplies, and there has been increased demand from Asia.
As a result, wholesale prices have soared 250 percent since January.