EDF Energy Pledges Over £100 Savings Below New Ofgem Price Cap
Energy regulator Ofgem has announced a 7% reduction in its energy price cap, effective from April 1, lowering the typical annual household bill for dual-fuel customers paying by direct debit to £1,641. This decrease follows the government's removal of certain levies and a recent drop in wholesale gas prices.
Understanding the New Price Cap
The £1,641 figure represents the annual cost for a typical household with average gas and electricity consumption, not a maximum bill. Customers using more energy will pay higher amounts, while those using less will see lower costs. The cap sets maximum unit rates for gas and electricity, along with maximum daily standing charges, which are fixed fees covering network connection and infrastructure maintenance, payable regardless of energy usage.
EDF's £101 Offer to Customers
EDF Energy has enhanced its fixed-term tracker tariff, Simply Tracker Extra Jun27, by reducing annual standing charges by £100 for dual-fuel customers. Based on the new price cap, EDF claims this tariff results in a typical annual bill of £1,540, saving households £101 compared to the cap. Unlike many tracker deals that focus on unit rate cuts, EDF applies the saving directly to standing charges, guaranteeing £50 per fuel off these charges relative to the price cap.
This approach ensures every customer receives the same £101 saving, irrespective of their energy consumption, making it particularly attractive to low-usage households who often benefit less from reductions in unit rates.
Industry Battle for Switchers
The move highlights a renewed competition among energy suppliers as wholesale costs ease and companies aim to lure households away from standard variable tariffs. With 57% of customers still on default deals, firms are increasingly offering fixed and tracker tariffs priced just below the cap to secure market share ahead of the next price review.
Philippe Commaret, Managing Director of Customers at EDF, stated, "It is welcome news that Government support means the price cap is decreasing, but we wanted to go further in reducing costs for EDF customers. By opting for a fixed or tracker tariff, customers can start saving today. This tracker tariff guarantees a £100 saving against the price cap over the next year, and by applying the discount through standing charges, we ensure all customers benefit equally, including those improving energy efficiency."
The tariff is available for a limited time to new and existing customers, including those paying by direct debit, cash cheque, and pay-as-you-go methods.
