Millions of energy customers who are set for a winter energy bill cost hit could potentially save a packet by taking a switching deal to move to a fixed energy deal instead
The clock is ticking down to the next unwelcome increase in energy bills for millions of households.
For while January 1 heralds the start of another year, it is also when Ofgem’s price cap goes up. This time it isn’t much – just 0.2% – but it’s still a move in the wrong direction and will in theory leave the average customer shelling out £1,758 a year. That’s in theory because there is lot to consider next year, what with the fact Ofgem reviews the level of the cap every three months.
But an even bigger factor could be the estimated £150 a year savings from measures announced by Chancellor Rachel Reeves in last month’s Budget. But if you’re one of those impacted by the price cap – and with around 34 million customer accounts on standard variable tariffs , that’s still most – you don’t have to sit back to swallow the increase.
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Rather than facing the unknown, a growing number of households are taking out fixed energy deals instead. In fact, the figure has risen to around 21 million, according to Ofgem. Fixed doesn’t mean, sadly, your overall bill won’t rise. But the unit rate you’re charged is locked in for a set period of time. What you pay in total is determined by your usage.
And if you’re wondering whether making the switch if worth it, then consider the fact that the average customer who is still on an SVT could save around £230 a year. The process of signing-up with another supplier can be done in a matter of minutes, too, though the process of moving you across takes a little while longer. Yet you might not even have to move supplier if you don’t want to. Check with your current provider to see what deals they have on that could save you money.
And if you already having smart meter with your existing supplier, that doesn’t hold you back either. Whether your meter is a first‑generation or the newer SMETS2 type, switching energy suppliers works just like it would with a traditional meter. Research for the Mirror by price comparison website Uswitch.com found there are 26 fixed deals cheaper than Ofgem’s current price cap.
The lowest overall is Ecotricity’s EcoFixed – 1 Year Oct 25 v1, which requires customers to have a smart meter. It is a 12 month contract and works put at an average £1,527 a year. It has a £75 per fuel – gas and electricity – exit fee, that you’d pay if you left before the contract is up.
Next is Outfox Energy’s Fix’d Dual Dec25 12M v1.0, at an average £1,541 a year, and available direct via Outfox the Market. It also has £75 per fuel exit fees. Also from Outfox Energy is its Fix’d Dual Dec25 12M v1.0 – Family Advantage+ product, at an ever so slightly more £1,542 a year on average. Again a £75 per fuel exit fee applies and is direct via Outfox the Market
Then there’s E.ON Next’s Next Fixed 12m v107, which is a year-long deal that costs an average £1,578 per annum. This one has a £50 per fuel exit fee and is available through Uswitch.com and direct via E.ON Next So Energy’s So Kings One Year Green tariff works out at an average £1,580. Its exit fee is £50 per fuel and can be accessed through Uswitch.com, Confused and direct via So Energy For the same average cost is EDF Energy’s Simply Fixed Feb27v2, which is a 15 month contract. It has a £50 per fuel exit fee and is available from Uswitch.com and direct via EDF Energy.
A little more pricey is Sainsbury’s Energy’s Sainsbury’s Fix and Save 12m v6, at £1,605 over the year. The exit fees are £50 per fuel and is available direct via Sainsbury’s Energy. The supplier also has a Sainsburys Fix and Reward Fixed 12m v63 deal that’s an average £1,610 a year, with a £50 per fuel exit fee.
E.ON Next’s Next Fixed 24m v35 is the longest in the current cheapest top 10, as it lasts for two years. It works out at an average £1,630 per annum but, because of the longer lock in period, the exit fees are higher, at £100 each.
Just making it into the top 10 is British Gas’s Fixed Tariff Dec26 v3, a 12 month deal at an average £1,643, and with a £50 per fuel exit fee.
Energy Secretary Ed Miliband has written to all suppliers calling on them to pass on its promised £150 average saving for those on fixed rates. So it means that the actual amount you pay from next April onwards will be even less. Moving deal now means you will benefit from the lower prices during the first three months of the year, when energy use peaks because of the cold weather.
Suzanne Edwards, energy expert at Uswitch.com, said: “Falling wholesale prices mean fixed energy deals are now offering much better value, making it a good time for households to consider locking in a rate before the price cap rises in January. Households with typical usage could save around £228 against the upcoming cap by switching to the cheapest fixed deal. If you haven’t fixed in a year or more, you’re probably on a standard tariff and paying more than you need to. Running a quick energy comparison is the best way to find out if you could lock in a cheaper rate.”