New update for EDF customers ‘as £150 returned’ | Personal Finance | Finance
EDF customers could be handed a welcome £150 boost to their finances after the energy giant unveiled a new trial aimed at slashing the hated standing charge.
The firm is offering eligible customers a discount of £6.25 a month per fuel taken straight off their standing charge – the fixed daily fee households pay simply for the privilege of being connected to gas and electricity. It comes on top of savings already available through EDF’s FreePhase tariffs, with the firm claiming customers switched onto the smart, time-of-use deal have banked an average of £152 in the first five months of this year alone, despite turbulent wholesale prices.
Crucially, there are no exit fees for those who decide the trial isn’t for them. The move follows mounting pressure on the energy industry – and on regulator Ofgem – to overhaul standing charges, which now gobble up more than £300 a year of the typical household bill before a single kilowatt of energy is used.
Campaigners have long warned that the charges unfairly penalise low-income and low-usage households, including pensioners and those in second homes who cannot cut their bills no matter how hard they try to economise.
Money Saving Expert founder Martin Lewis has been among the most vocal critics, previously revealing that complaints about standing charges outstrip those on any other aspect of energy bills – and campaigning for years for a low, or even no, standing charge option.
Ofgem confirmed earlier this year that EDF, alongside British Gas, E.ON and Octopus, would take part in a landmark pilot offering lower standing charge tariffs to eligible customers, in a scheme expected to benefit some 150,000 households nationwide.
The regulator said the trial should knock at least £150 off the standing charge portion of dual-fuel bills, though unit rates are likely to rise to compensate.
Mr Lewis has previously cautioned that such deals sit outside the energy price cap, warning it risks leaving behind vulnerable customers who rarely shop around or switch supplier.
Callum Morgan, Product Design Expert for Smart Tariffs at EDF, said the company was determined to keep finding ways to help customers cut their bills.
“It is important that we and Ofgem continue to look at ways we can help all of our customers reduce their bills, so we are pleased to offer this trial tariff, focused on helping lower users save,” he said.
“Combining the trial with our FreePhase product gives customers a real opportunity to make more sizable savings which we hope will make a real difference.”
Under FreePhase Dynamic, electricity is split into three price bands: a cut-price “green” overnight rate from 11pm to 6am, a mid-price “amber” band covering most of the day and evening, and a costlier “red” peak band from 4pm to 7pm.
Prices are updated daily in line with wholesale costs, with tomorrow’s rates published in advance so households can plan ahead – running the washing machine, dishwasher or charging an electric car when power is cheapest.
For those who prefer certainty, EDF is also offering FreePhase Static, which uses the same three-band structure but locks in unit rates for a full year. EDF said off-peak “amber” rates under the static deal were up to 10 per cent cheaper, and overnight “green” rates up to 37 per cent cheaper, than the previous month’s standard variable tariff.
New customers can sign up through EDF’s existing FreePhase online process and register their interest in the trial, while existing FreePhase customers can also apply to take part.
The launch is likely to pile pressure on rival suppliers to follow suit, as households continue to grapple with sky-high bills and calls grow louder for a fundamental rethink of how standing charges are levied.
