Since energy bills are one of the most significant hidden costs for students living in the UK, choosing the right electricity supplier could help you save money. Considering energy costs is just as crucial as essential expenses, such as accommodation, transportation, and general living costs. Luckily, the UK energy market is highly competitive, allowing you to choose from a range of providers to find the best deal. 

In this guide, we’ll highlight some of the cheapest gas and electricity suppliers in the UK to help you make an informed decision and lower your monthly bills.

General Living Costs in the UK

The average cost of living in the UK depends on a number of factors, including location, lifestyle choices, and individual circumstances. Generally, living in the UK can be quite expensive compared to other countries, and many students spend the most on accommodation, transportation, and food. 

According to Edwest Global, renting accommodation in London can cost between £750 and £1,200 per month, while outside London, the average cost ranges from £500 to £900, depending on the type of accommodation. Utilities and bills can add up to around £90 to £160 per month in London, while in the rest of the UK, they average between £50 and £100.

Transportation costs can vary, but in a major city like London, it typically costs around £100 to £150. Groceries and food can also be significant expenses, with a monthly food budget ranging from £200 to £300 in London, and from £150 to £250 in other cities. Other expenses, such as healthcare, insurance, and entertainment, should also be taken into account when calculating the overall cost of living in the UK. 

There are several ways to reduce cost of living in the UK, including choosing the right energy supplier. 

Understanding the UK Energy Market

First and foremost, it’s important to understand the UK energy market structure before exploring the most affordable suppliers. The market is divided into two segments: the wholesale market and the retail market. 

Wholesale energy prices fluctuate based on various factors, including demand and supply, global events, and weather conditions. Retail suppliers purchase energy in bulk from the wholesale market and sell it to consumers, setting their own prices and tariffs.

Energy Price Rises

Energy prices in the UK have surged in recent years, driven by several key factors. Mainly, the country’s reliance on natural gas as its primary source of electricity generation has been a factor. Natural gas prices have also been on the rise worldwide, since it’s a major component of energy production, and its cost directly impacts electricity costs.

The UK has been directing their efforts towards utilising renewable energy alternatives such as wind and solar power. While this shift is beneficial for environmental reasons, the initial investments and infrastructure development required for renewable energy generation have contributed to the overall increase in energy costs. However, these investments will lead to a long-term reduction of costs. Moreover, due to some global influences, there has also been an increase in energy prices.

Why Switch Gas and Electric Suppliers in the UK

Switching suppliers can make a real difference to your monthly budget, and people often consider switching as an option due to the following reasons:

1- Cost savings

Among the top reasons people switch suppliers is to save money. Since the rates and tariffs proposed by different suppliers vary, consumers can potentially save on their energy costs by securing better deals.

2- Fixed-Rate Tariffs

Some suppliers offer fixed-rate tariffs, where the price per unit of energy remains consistent for a specific period, typically 1–3 years. This can provide stability and protection against price increases in the volatile energy market.

3- Green Energy Options

More and more people are increasingly concerned about the environmental impact of their energy consumption. By switching to suppliers that offer renewable or green energy options, individuals can support a cleaner and more sustainable energy sector.

4- Improved Contract Terms

Switching suppliers provides an opportunity to review and choose contracts that meet specific preferences and needs. This involves considering factors such as contract length, payment options, and billing frequency.

Affordable Gas and Electric Suppliers in the UK

• Octopus Energy 

Octopus Energy has gained popularity due to its competitive prices and excellent customer service. It offers a range of tariffs, including fixed and variable options, which promote flexible plans. Octopus Energy is also a good choice for eco-conscious consumers due to its commitment to renewable energy.

• E.ON

E.ON is a prominent supplier offering a range of tariffs, including fixed-rate and flexible options. They offer competitive rates for electricity with a strong focus on renewable energy, making them a popular choice for eco-friendly consumers. E.ON also provides innovative solutions, including energy efficiency products and smart meters.

• Home Energy

Home Energy is a smaller UK supplier that stands out for its straightforward pricing and competitive variable tariffs, even though it doesn’t offer loyalty rewards like larger suppliers. Its simple pricing structure and transparent service make it a budget-friendly choice for those who prioritise savings, flexibility, and low-cost energy.

Unit Cost per kWh in the UK

The unit cost per kilowatt-hour (kWh) in the UK varies depending on several factors, including the energy supplier, the type of tariff, and the region. Here is the average cost of electricity per kWh in the UK for 3 of the most affordable energy suppliers:

Unit rates and standing charges are based on national averages, and prices may vary slightly by region and metre type.

How to Choose the Best Energy Suppliers

Choosing the best energy supplier involves considering various factors to ensure that the supplier meets your specific needs and preferences. Here are some key steps to help you make an informed decision:

1- Research and Compare Suppliers

Start by researching and comparing different energy suppliers in your area. Look for reputable companies with a track record of reliable service and positive customer reviews. Consider factors such as pricing, customer satisfaction ratings, renewable energy options, and additional services they offer.

2- Decide What Matters Most to You

Identify your priorities and preferences. Are you primarily focused on finding the lowest price or prioritising renewable energy options? Consider factors such as customer service, billing methods, online account management, and any specific requirements you may have.

3- Compare Tariffs and Pricing

Energy suppliers offer various tariffs and pricing structures. Compare the unit cost per kWh, standing charges, and any additional fees or discounts associated with different tariffs. Look for transparent and competitive pricing that suits your energy consumption patterns and budget.

4- Consider Contract Terms

Review the contract terms offered by each supplier. Pay attention to the contract length, exit fees, and any terms and conditions that may impact your flexibility as a customer. Ensure that the supplier's contract terms align with your preferences and requirements.

5- Check Customer Service and Support

Reliable customer service is crucial when dealing with energy suppliers. Research customer reviews and ratings to assess the level of customer satisfaction with a particular supplier. Consider factors such as ease of communication, responsiveness to queries or complaints, and support channels offered (phone, email, online chat, etc.).

Switching Energy Suppliers’ Process

Switching energy suppliers in the UK is a relatively straightforward process. Here's a step-by-step guide to help you understand the general process:

1- Choose A New Supplier

Once you have identified a suitable supplier, initiate the switching process by contacting them directly or visiting their website. Most suppliers have online forms or dedicated phone lines to assist with the switching process.

2- Provide Information

You will need to provide certain information to the new supplier to facilitate the switch. This may include your current energy supply details, metre readings, personal information, and your current supplier's name and account number.

3- Review the New Contract

The new supplier will provide you with a contract or agreement outlining the terms and conditions of your new energy supply. Read the contract carefully, paying attention to pricing, contract length, exit fees, and any special terms or conditions.

4- Cooling-Off Period

After you sign the contract, you typically have a 14-day cooling-off period during which you can change your mind and cancel the switch without any penalties.

5- Inform Your Current Supplier

Your new supplier will handle most of the switching process on your behalf, including notifying your current supplier of the switch. However, it's a good idea to inform your current supplier about your intention to switch to avoid any confusion.

6- Metre Readings

On the day of the switch, take metre readings for both your gas and electricity metres. This ensures accurate billing and prevents any disputes later on. Provide the metre readings to both your old and new suppliers.

7- Final Bill and Account Closure

After the switch, your previous supplier will issue a final bill based on the metre readings you provided. Pay any outstanding amount and ensure a smooth account closure.

It's important to note that the time it takes to complete the switch can vary, but it usually takes around 21 days from the initiation of the switch. During this period, your energy supply should not be interrupted, and both your old and new suppliers will keep you informed about the progress of the switch.

Finding the cheapest gas and electric suppliers in the UK involves researching and comparing various options. Remember, it's not only about finding the cheapest supplier but also considering your specific energy needs, customer service quality, and any additional benefits or rewards programmes offered. 

Always keep an eye on the energy market, as prices and deals change regularly. By staying informed and proactive, you can make the most cost-effective choices for your gas and electric supplies.