Energy prices £189 more in some regions due to postcode lottery

Energy prices £189 more in some regions due to postcode lottery

07 June 2010 / by Rachael Stiles

Some areas of the UK pay up to £189 more for their energy than other regions, according to research from uSwitch.com.

The energy postcode lottery has long been a bug bear for industry commentators, as some consumers are being forced to pay an average £100 difference, or nearly £200 a year more in some places, for their gas and electricity, simply because of where they live.

The cheapest place for energy was found to be Nottingham, where the average annual energy bill is £855, compared to the most expensive place, Cardiff, where it is an average £949 for the same amount of fuel.

Even on the internet, a postcode can still determine how much householders will have to pay; but, wherever they live, uSwitch.com urges consumers to go online and compare gas and electricity deals, because that is where the cheapest tariffs are to be found and it might help to counteract the difference.

Online energy plans remain the most competitive deals available, argues uSwitch, savings customers an average £300 on a standard offline tariff. The key to finding the cheapest one is to make sure it applies to their region, the comparison website suggests, because even the big six suppliers' prices vary by as much as £155 in one region.

Commenting on the energy postcode lottery, Ann Robinson, director of consumer policy at uSwitch.com, said: "Ofgem's push on cost reflective pricing may iron out some of the extremes, but the fact is that while suppliers choose to target their ultra-competitive online plans regionally we will continue to see a postcode lottery. Regional pricing is a key part of the competitive battlefield – the important thing is for consumers to avoid becoming a casualty."

Some consumers make the mistake of thinking that their local supplier will offer them a cheaper deal for their loyalty, but, Ms Robinson says, they often do not and consumers should do what they can to combat this.

"They can do this by making sure they move to the most competitive plan with the most competitive supplier in their region," she urged. "Even though all suppliers offer their cheapest prices online, these can vary by as much as £155 in one area, which is why it's so important for households to shop around."    

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