ENERGY GUIDE
Best Energy Tariff UK
Energy tariffs differ on unit rates, standing charges, contract length and exit fees. This guide explains how to compare UK energy tariffs, what fixed vs variable means and what Ofgem rules apply.
TL;DR
- Fixed tariffs lock in unit rates for a set period; variable tariffs track the Ofgem price cap
- The cheapest tariff depends on your usage -- annual kWh consumption is the key input for comparison
- Standing charges and unit rates both matter -- a low unit rate with a high standing charge may not save money
- Green tariffs are backed by renewable energy certificates but do not guarantee your home receives renewable electricity
- Ofgem requires suppliers to show tariff information clearly using standardised tariff comparison rates (TCRs)
Last reviewed: June 2026
Fixed vs Variable Energy Tariffs
A fixed-rate energy tariff locks in the unit rates for electricity and gas (and the standing charges) for a specified period, typically 12 to 24 months. Your rates do not change during the fixed term regardless of movements in the Ofgem price cap or wholesale energy costs. A variable tariff (often called the standard variable rate or default tariff) has rates that can be changed by the supplier subject to Ofgem rules -- the price cap limits how high these rates can go on default tariffs.
How to Compare Energy Tariffs
To compare tariffs accurately, you need your annual electricity consumption in kWh and annual gas consumption in kWh, both available on recent bills or from a smart meter. Using these figures, you can calculate the annual cost of any tariff: (annual kWh x unit rate) plus (365 x standing charge per day). Comparing total annual cost rather than unit rates alone is essential -- a lower unit rate with a higher standing charge can cost more overall for a given level of usage.
Tariff Comparison Rates
Ofgem requires energy suppliers to publish tariff comparison rates (TCRs) for electricity and gas tariffs. TCRs are a standardised unit price that incorporates both the unit rate and a proportion of the standing charge, allowing like-for-like comparison. However, TCRs are based on a standard usage assumption -- actual costs depend on your consumption level. For heavy users, a low unit rate (even with a high standing charge) may be better value; for low users, a low standing charge may matter more.
Green Energy Tariffs
Green energy tariffs are backed by renewable energy certificates (REGOs -- Renewable Energy Guarantees of Origin), which certify that a unit of electricity has been generated from renewable sources. A green tariff does not mean electricity flows directly from a renewable generator to your home -- the UK electricity grid uses a mix of generation sources. REGOs allow suppliers to claim their tariff is backed by renewable generation. Ofgem publishes guidance on what green tariff claims must be supported by.
Smart Meter Tariffs
Smart meters transmit half-hourly consumption data to suppliers, enabling time-of-use tariffs that charge different rates at different times of day. Economy 7 tariffs (available without smart meters) charge a lower rate for a 7-hour overnight period. Smart tariffs can offer significant savings for households with electric vehicle charging or heat pumps that can shift demand to off-peak periods.
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Disclaimer
This guide is for general information only and does not constitute legal, financial or insurance advice. Kaeltripton is an independent editorial publisher, not regulated by the FCA.
Frequently Asked Questions
How do I find the cheapest energy tariff?
Compare tariffs using your annual kWh consumption for electricity and gas. Calculate the full annual cost of each tariff (unit rate x annual kWh + standing charge x 365) rather than comparing unit rates alone. Ofgem-accredited price comparison services provide standardised tariff comparison tools.
Should I fix my energy tariff?
Fixing provides certainty on energy costs for the fixed term regardless of price cap movements. If wholesale energy prices rise and the price cap rises, a fixed tariff provides protection. If wholesale prices fall, the price cap may fall below your fixed rate. The decision depends on your attitude to price risk and the current relationship between fixed tariff rates and the price cap.
What is a standing charge on an energy tariff?
The standing charge is a fixed daily charge paid regardless of how much energy you use. It covers the cost of maintaining the connection to the network. Customers who use very little energy may find that the standing charge makes up a significant portion of their total bill.
Are green energy tariffs worth it?
Green tariffs backed by REGOs support the renewable energy market by creating demand for renewable generation certificates. Whether a premium for a green tariff is worth it is a personal value decision. Some tariffs are certified under schemes such as the Green Energy Certification Scheme (GECS) which provides additional transparency on how the backing is structured.
Sources
- Ofgem: Tariff comparison rates -- Ofgem
- Ofgem: Green energy guidance -- Ofgem
- Domestic Gas and Electricity (Tariff Cap) Act 2018 -- legislation.gov.uk
