The federal government wants to force energy retailers to offer customers a cheaper deal in just "one click" when a plan ends, to prevent those contracts automatically rolling over to more expensive deals.

Last week's budget contained a $1.8 million plan to save more than two million households money on their energy bills with what the Energy Minister Chris Bowen calls a "small but important" initiative.

Dubbed the "one-click switch", the measure would make it as easy as possible for customers to ensure they are on the cheapest deal available, and receiving concessions and rebates they are entitled to, ideally by enabling people to move to the cheapest plan in a single click on a retailer's website.

Separate funding has also been committed to improve the Energy Made Easy comparison website, so people can weigh up provider deals more easily.

In 2023, the competition watchdog found as many as a quarter of customers were paying more on power bills than they needed to because they had not actively pursued the lowest-cost plans with their provider, or switched providers to take advantage of new customer deals.

The Australian Competition and Consumer Commission found in some cases those households could save up to $400 a year just by switching plans.

The energy minister said the budget measure would make it easier for customers to find better plans and to switch, and further reduce cost of living over the long term.

"We know households are doing it tough and we don’t want them to be paying one cent more than necessary for their electricity bills," Mr Bowen said.

"The Albanese government wants to make sure legacy high bills are taken out of the system and that the process to get the best deal on energy is as simple as possible."