Cheapest fixed energy deals disappear ahead of £155 bill rise this winter – how to dodge the increase now
TOP fixed-energy deals have started to disappear ahead of bills going up again this winter.
The energy price cap is predicted to rise by £155 to £1,723 a year from October, up from £1,568.
This week, several energy firms withdrawn their cheapest fixed-rate deals, which could have saved customers hundreds of pounds.
Outfox the Market and EDF have removed their cheapest fixed energy tariffs from the market.
British Gas, Octopus Energy, and Co-Op Energy have also upped prices their fixed tariffs.
It means the best fixed deals are now between £7 and £103 more expensive, according to uSwitch.
It’s not unusual for suppliers to reprice or remove their fixed energy tariffs from the market, as this can be a reaction to fluctuating wholesale market conditions.
Just yesterday, EDF Energy discontinued one of the market’s most affordable deals.
This offer could have saved a typical customer up to £156 annually, assuming Ofgem’s predicted price cap increases to £1,763 a year in October.
The deal, exclusive to price comparison website uSwitch, was pulled at 4pm on Tuesday.
While it’s now too late to take advantage of this particular offer, there are still a range of deals available, and one has the potential to save households £159 a year.
How do fixed deals work?
Fixed deals work to protect customers from bill hikes if Ofgem were to increase the price cap in the future.
Customers on their supplier’s standard variable tariff see their energy prices change every three months, as these are tied to Ofgem’s price cap.
However, those who lock into a fixed energy deal are charged the same gas and electricity rates throughout the contract’s term.
Of course, doing so carries a slight risk of you paying more than those on the standard variable tariff if Ofgem’s energy price cap were to fall within your deal’s term.
However, this risk is minimal as analysts at Cornwall Insight predict that the energy price cap will rise by £155 to £1,723 a year from October – up from £1,568.
It’s then expected to remain at this level until April 2025.
At the moment, those on the standard variable tariff (SVT) have their rates capped by Ofgem at the following levels:
- 5.48p per kilowatt hour (p/kWh) for gas
- 22.36p/kWh for electricity
- A standing charge of 31.41p per day for gas
- A standing charge of 60.12p per day for electricity
For a typical household that uses an average of 11,500kWh of gas and 2,700kWh of electricity every year, these rates will cap bills at roughly £1,568.
As this is only an estimate for a typical household, if you use more energy, you’ll pay more.
However, as households on the standard variable tariff are set to see their bills rise from October, it’s worth checking to see if you can get a fixed deal now.
If you’re offered a fix that’s cheaper than October’s price cap prediction, it’s always worth considering.
Elise Melville, energy expert at Uswitch.com, said: “With the energy price cap predicted to increase in October, it’s never been more important to look at what deals are available.
“It’s important to prepare now for future price rises and consider locking in rates while there are competitive deals to choose from, as deals could get more expensive over winter.
“Energy suppliers are always repricing their fixed deals, both up and down, due to fluctuating wholesale market conditions.
“There are plenty of 12-month fixed tariffs available that are cheaper than the predicted price cap for October, which can offer price certainty on what you’ll pay for a year and potentially help you save on your bills.”
How can I check future price cap predictions?
EDF Energy has launches a brand new Ofgem price cap prediction tool on its website.
The energy company updates the tool with new information about changes to the cap on energy prices every Tuesday.
It also includes advice on how this affects your energy tariff choices.
You can find out more by visiting www.edfenergy.com/gas-and-electricity/price-cap-predictions.
Which suppliers are offering the best-fixed deals?
Outfox The Market is currently offering the cheapest deal on the open market to new and existing customers.
Its Fix’d Duel Aug24 v2.0 tariff, costs a typical household £1,577 a year.
This means it is £4 cheaper than Ofgem’s current price cap and £159 cheaper than the forecasted cap from October.
This comes with a £25 exit fee per fuel, or £50 if you lock in with a dual fuel tariff.
Next is Octopus Energy’s 12M Fixed August 2024 tariff, which costs a typical household £1,599 a year.
This means it is £31 more than Ofgem’s current price cap but £124 cheaper than the forecasted cap from October.
This comes with no exit fees and is open to both new and existing customers.
Co-op Energy’s 12M Fixed August 2024 v1 offer charges the same as Octoput Energy’s deal above.
Existing customers at Ovo Energy can save more by switching to its 1 Year Fixed Loyalty Tariff direct.
This tariff costs a typical household £1,577 a year – £146 less than the predicted cap from October.
However, it’s always best to compare prices before switching as energy tariffs vary based on where you live.
What are the alternatives?
Customers unwilling to commit to long-term fixed energy deals may want to consider flexible tariffs.
Kara Gammell, personal finance expert at comparison site Money Supermarket Group, says: “These will almost always be at or below the price cap.”
For example, E.ON Next’s Pledge variable tariff offers a fixed discount of around three per cent on the price cap rates for 12 months.
It will save the average household around £50 a year but comes with a £50 exit fee if you switch before the year ends.
The deal is available to both new and existing customers.
EDF Energy’s Ensure Tracker works in a similar way and offers a £50 discount off the price cap’s standing charges for 12 months.
For a bigger reward but at a higher risk, Octopus Energy offers two variable tariffs which track wholesale gas and electricity costs.
Customers on the Octopus Tracker see their prices change daily, but unit rates have remained consistently lower than the price cap in recent months.
For example, in the last 30 days, people living in Southern England on the Octopus Tracker paid a maximum of 22.7p per kWh for electricity and 4.85p per kWh of gas.
The Agile Octopus tariff works similarly to the Octopus Tracker, the main difference is the former’s prices change every half hour.
Remember that those wishing to switch to any of these tracker tariffs must have a smart meter.
What energy bill help is available?
THERE'S a number of different ways to get help paying your energy bills if you're struggling to get by.
If you fall into debt, you can always approach your supplier to see if they can put you on a repayment plan before putting you on a prepayment meter.
This involves paying off what you owe in instalments over a set period.
If your supplier offers you a repayment plan you don’t think you can afford, speak to them again to see if you can negotiate a better deal.
Several energy firms have grant schemes available to customers struggling to cover their bills.
But eligibility criteria varies depending on the supplier and the amount you can get depends on your financial circumstances.
For example, British Gas or Scottish Gas customers struggling to pay their energy bills can get grants worth up to £2,000.
British Gas also offers help via its British Gas Energy Trust and Individuals Family Fund.
You don’t need to be a British Gas customer to apply for the second fund.
EDF, E.ON, Octopus Energy and Scottish Power all offer grants to struggling customers too.
Thousands of vulnerable households are missing out on extra help and protections by not signing up to the Priority Services Register (PSR).
The service helps support vulnerable households, such as those who are elderly or ill, and some of the perks include being given advance warning of blackouts, free gas safety checks and extra support if you’re struggling.
Get in touch with your energy firm to see if you can apply.