Two more energy giants announce price cuts

British Gas and Scottish & Southern Energy (SSE) have both announced small price cuts for their energy customers.

British Gas has reduced its standard electricity prices by 5% from today as the energy price war really starts to heat up.

It says that the cut will save its 5.3 million single rate electricity and dual fuel customers on a variable tariff £24 a year on average. It won't apply to people who are on Economy 7 or have already fixed their tariff.

British Gas claims that this cut now makes it the cheapest major electricity supplier in Britain.

Meanwhile, SSE says that it will reduce the typical gas bill of its customers by around £28 a year. If you're an M&S Energy customer, you'll also benefit from the price drop.

However, Consumer Focus says SSE is not applying the price cut to its standing charge - the daily charge customers have to pay to the supplier - so the real price cut is actually 3.8%.

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Big drop unlikely
Back in August, British Gas raised its electricity prices by a whopping 16%, so it's debatable if any existing customers will see a noticeable drop in their bills.

Yesterday, EDF cut its gas prices by 5% in response to the falling wholesale price of gas. And it's more than likely that the rest of the 'Big Six' - E.ON, npower and Scottish Power - will now follow suit.

Smaller suppliers Ovo and Co-operative Energy have gone one step further by both reducing their dual fuel tariffs in recent weeks.

Switch or wait
Despite the forecasts of further price drops, it's still well worth comparing rates and seeing if you could save.

If you haven't switched tariffs in a while, chances are you are on the standard and most expensive rate. Changing onto a fixed or online tariff could cut your bills immediately. Yes, rates could continue to drop in the coming months. But if you do decide to stick on a pricey deal and wait around for them, you could see the excess you're paying now outweigh any future savings.

So with that in mind, here are the current cheapest energy tariffs:

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As you can see, there's still as much as £315 to be saved by switching onto the market-leading tariff.

The best deal currently around is the online iSave tariff from first:utility. However with the top fixed tariff just £31 pricier on average, it may be worth foregoing the cheapest deal for the peace of mind of a year-long, set-price rate.

* All calculations are for an average usage duel fuel household paying by monthly direct debit. Average usage as defined by OFGEM is 16,500 kWh pa of gas and 3,300 kWh pa of electricity.

** Against a typical bill of £1,345 per year (source: Ofgem).

• Switch energy suppliers - see if you could save