Why Energy Price Comparison Websites Have Let Households Down For A Decade

Energy suppliers’ tariff information is almost impossible to access and compare with other suppliers’ data. That’s why most households tend to use a price comparison website to make energy decisions.

Buyer beware!

Price comparison sites are marketing platforms which normally charge energy suppliers every time their tariffs are listed in a search result, boosted to the top of the search results, given a shout out in consumer newsletters and emails, or given an ‘exclusive tariff’ badge meaning it appears higher than other, cheaper tariffs.

The money suppliers spend on price comparison sites are passed on to consumers through the energy bills. That would be okay if consumers were always guaranteed to land upon the best value tariff……but sadly that’s often not the case.

Consumers have been let down by price-comparison websites since 2015 when the Competition & Markets Authority removed the requirement for these platforms to show all tariffs. Instead, for the last decade, most have only shown consumers the tariffs that they get paid to show, and ALL price comparison sites still refuse to offer a switching service to suppliers they don’t get commission from.

"One supplier told me they’d paid more than £1 billion in comparison site fees, which they had been forced to recover via bills. When I asked why they had continued to appear on these sites, they explained that they have no choice because there’s no other place where consumers can get impartial and unbiased advice. WattsWatt is here to end the costly status quo."

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Poor tactics which have cost lives

Price Comparison Sites are designed to make money out of consumer confusion. They have proactively designed their sites to make energy appear more confusing than it is.

Here are a few lookouts:

"Opt-in to see cheaper tariffs" button

Most price comparison sites will only show you the tariffs they are paid to show you, by default. There’s often an ‘opt-in’ button at the top left hand corner which includes tariffs that they aren’t paid to show you. These will always be cheaper.

"Annual savings"

There’s no such thing as annual savings for the year ahead as they don’t know how much you are going to use and pay. The only real ‘saving’ you can make is on the unit rate and standing charge, but price comparison sites never focus on these. All you need to do is check you are on the best unit rate and standing charge - this is what WattsWatt helps you to do.

"Monthly direct debit amount"

This is irrelevant as it is only how much you are paying to the supplier each month - if you use more, you’ll be left with an energy debt at the end of the year, and if you use less, you’ll be left with a credit. What matters is the unit rates and standing charges but these are often out of sight.

"Exclusive tariffs"

This is often a ‘tease and squeeze’ tactic, where a ‘cheapest fixed tariff’ is advertised to you directly via an email marketing campaign, and then you are sent into a comparison engine never to see that tariff again.

"Ending soon"

This is how these marketing platforms create a sense of urgency to secure switches to the fixed deal they are advertising. These deals are often not the cheapest, but the price comparison website gets a bonus payment for every person they secure.

"Best tariff from ‘supplier’ since 2021"

This provides a false sense of price security, but doesn’t reference how it compares to other, cheaper tariffs on the market.

"Price cap is going up"

Price comparison websites use the price cap as a sense of urgency for encouraging switching. Once consumers are hurried into acting, they are led towards tariffs that will result in overpaying for energy.

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WattsWatt Replaces Manipulation with Merit

WattsWatt expects to replace the energy price comparison websites for UK households. Lisa Malyon comments:

"We’re taking on a public service role by making all energy tariff data easy to access, easy to understand and compare in the interest of households staying warmer during winter.

Our service is completely impartial and independent, so consumers can trust the information they are seeing as working in their best interest."