The energy giant has launched its ‘E.ON Secure Bill’ which it says will allow customers to “enjoy a personal price” and “peace of mind” where annual bills are fixed rather than just on price per unit and standing charge.

The price you’ll pay is based on your gas and electricity use over the past year and means that if you use more energy in the next 12 months than you did in the previous period, you’ll still pay last year’s prices. However, if your usage falls, this will be reflected in the next annual quote when you come to renew.

E.ON says an average energy user, based on 3,100 kWh electricity and 12,000 kWh gas, will pay £1,224 over the year, or £102 per month.

However, there’s one big catch. You need to agree to being contacted about having a smart meter fitted, and where eligible, have one installed. Further, if you want to exit the contract early, it will cost you £75 per fuel, £150 for gas and electricity customers.

Michael Lewis, CEO of E.ON UK, says: “Unlike other fixed term tariffs which are available today, Secure Bill means customers’ payments won’t change during the year, regardless of how much energy they use. This gives customers complete reassurance about how much they’ll pay each month for 12 months and the ability to accurately budget for their energy.

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“And we’re installing smart meters for Secure Bill customers so they don’t lose sight of how much energy they’re using throughout the year. If customers cut their energy use during the year, this will be reflected in next year’s annual quote.”

Our Q&A below explains more

How do I supply annual usage figures?

If you’re an existing E.ON customer, it will use your previous consumption information to predict the price you’ll pay. For new customers, it will be based on the billed information you provide. You can find this on your annual energy statement from your previous supplier.

I already have a smart meter, can I get this tariff?

Yes.

Can I refuse to get a smart meter?

E.ON says it will be fitting smart meters for customers “wherever possible”. However, if properties aren’t suitable for a smart meter, you can still join the tariff.

Why is E.ON pushing me to have a smart meter?

This is the second such offer from E.ON where it’s a condition to get a smart meter if possible. E.ON says “smart meters are a vital upgrade to the UK’s energy infrastructure. Smart meters will help customers keep track of their energy use and spend and we’re therefore keen to ensure customers can benefit from smart meters.”

Will I face any price hikes during the contract period?

No. The price you’ll pay will be fixed for the duration of the tariff (12 months).

Is this a time-limited offer or will it be around for a while?

E.ON says: “We constantly review our product portfolio and continue to look for ways in which we can keep prices as affordable as possible for our customers.”

How good is this tariff?

Stephen Murray, energy expert at MoneySuperMarket, says this tariff is likely targeted at those who want consistency, but it’s unlikely to be among the cheapest tariffs as customers could make savings from other cheaper deals.

“E.ON has some experience with a ‘fixed cost’ tariff, from its ‘Staywarm’ tariff that it ran for several years. That should mean many of the potential pitfalls regarding consumption and renewal have been factored in to this initiative…and the £75 exit fee per fuel also gives it some comfort should customers choose to leave before renewal.

“E.ON has been one of the foremost suppliers in smart meter roll-out, but all suppliers still have very exacting targets to hit if we are to get to the 2020 targets set by government. This initiative will no doubt be part of this strategy to continue this roll-out programme.

Rik Smith, energy expert at uSwitch.com, adds: “E.ON’s Secure Bill tariff is a good example of an energy supplier offering its customers something different. This deal won’t be for everyone as there are bigger savings to be made elsewhere but for somebody on a fixed income or expecting their bills to go up in the coming year – possibly due to a new baby or change in circumstances – then this tariff could be worth considering. As with most fixed energy deals, this plan has exit fees and at £75 per fuel these are considerably higher than usual.

“Another aspect of this plan worth mentioning is that it is the latest example of a tariff that’s only available to energy customers willing to get a smart meter. Smart meters can really help households take control of their energy use and spending, but at the moment if homes want to switch supplier after getting one of these new meters, it can lose smart functionality.”