Research out today by Which? revealed that 95% of energy suppliers were unable to clearly explain what Tariff Comparison Rates (TCR) are. This is extremely disappointing news as we were one of the suppliers that failed this challenge.
So, first off, we’re going to start by explaining what the TCR is.
The Tariff Comparison Rate is there to act as a price comparison guide for all energy customers. It breaks down the cost of an energy tariff by combining everything from the unit rates, standing charges, VAT and discounts into one amount and then dividing it by the average annual consumption figures published by Ofgem – the energy regulator.
The idea is to allow all tariffs to be compared against one another, by giving you a single price per kilowatt hour for the energy you use. It’s similar to an APR on a credit card or a financial loan.
As we mentioned before, the calculations are based on the average amount of energy that households use in the UK and this is where the TCR can start to be confusing.
Multiply the unit rate by Ofgem’s average energy consumption figures*
Add a year's standing charge
Take away any discounts that might be applicable
Add the VAT
Finally, divide this figure by Ofgem’s average consumption figures
This gives you the TCR in pence per kWh
Not exactly simple! But that’s why it’s part of our job to help explain it, and why we’ve now retrained all our customer care agents to make sure they can.
It’s important to know how much energy you’re using to make sure you’re on the right tariff for you. As you can see, if you use more or less energy than the UK average then the TCR isn't going to be an accurate comparison for you. This is because you’re dividing the combined cost of your tariff (the bit where we add the unit rates, standing charges, VAT and then take away any discounts) by the wrong amount of energy used.
This is pretty tricky to write down so we’ve put it into a diagram...
Here are some top tips for an easy switch:
OVO Energy Ltd, registered office 1 Rivergate Temple Quay Bristol, BS1 6ED, company no. 06890795 registered in England and Wales, VAT No. 100119879
Additional terms and conditions
Please see below for full terms and conditions on 33% renewable electricity, 3% interest rewards, exit fees and saving claims.
1Monthly cost - Representative monthly direct debit costs based on a non-economy-7, dual-fuel, medium user (3100 kWhs elec. and 12500 kWhs gas) paying in advance by direct debit, including online discount. All rates correct as of 23/08/16, but may go up or down.
2Weekly cost - Representative weekly costs based on a non-economy-7, dual-fuel, medium user (3100 kWhs elec. and 12500 kWhs gas). All rates correct as of 23/08/16, but may go up or down.
3Pay Monthly Savings are based on the average estimated annual costs for new PAYM OVO customers quoted through the OVO website (based on household and/or consumption information provided by those customers), compared to their current supplier and tariff. Comparisons taken between 01/01/2016 and 11/10/16. Incl VAT. Actual savings may vary according to your current supplier or tariff, individual tariff options, household information, consumption and location.
4Pay As You Go Savings are based on the average estimated annual costs for new PAYG OVO customers quoted through the OVO website (based on household and/or consumption information provided by those customers), compared to their current supplier and tariff. Comparisons taken between 01/01/2016 and 11/10/16. Incl VAT. Actual savings may vary according to your current supplier or tariff, individual tariff options, household information, consumption and location.
We include almost twice as much renewable electricity as the national average: At least 33% of electricity in all of our tariffs comes from renewable sources. The national average, according to Ofgem as at March 2014 was 16.7%. For more information please visit this page.
33% of your electricity comes from renewable sources: 33% renewable electricity as standard as of 1st April 2015. Renewable electricity is generated from wind, solar, geothermal, wave, tidal, hydro, biomass, landfill gas, sewage treatment plant gas and biogas.
3% interest: Calculated at 3% per year, paid monthly based on number of days in credit and the amount left in your account after you’ve paid your bill. OVO Interest Reward is capped at 12 times the amount of the current direct debit amount and is available to customers paying by advance direct debit. Terms apply: http://www.ovoenergy.com/terms/
95% of new customers save when switching to OVO: Based on all new customer signups between 01/02/2016 and 31/07/2016
94% of surveyed customers would recommend us: OVO conducted a survey of their customers in between 1st January 2016 and 15th April 2016. Out of 15,312 customers who responded, over 94% rated OVO 6+ when asked 'how likely would you be to recommend us to a friend and family, on a scale of 1 to 10.
Britain's top rated energy provider: Britain's top rated energy provider in the Which? 2015 satisfaction survey. Survey conducted in October 2015. Awarded in January 2016.