We've only just got used to paying higher bills from the April energy price cap hike when we've been told to stand by for energy costs rising again in October.
And if Ofgem gets its way, the cap will be reviewed every three months, meaning prices could be hiked not twice but four times each year.
With prices only seeming to go upwards at the moment, the vexed question of whether its worth fixing your bills has come into focus again, although your options to do so are extremely limited at the moment.
Read more: What is the energy price cap, how much is it rising and why is it in the news now?
Ofgem has warned that the energy price cap will surge to £2,800 in October, piling even more pressure on already-strained household budgets. The energy regulator said it expects the cap to rise 42% from its current level of £1,971. That’s on top of a 54% increase in April and up from £1,277 in October 2021.
The energy market has long been in crisis, with record prices and no cheap deals for switchers. So the big question is what to do – stick on the price cap, or lock in to a fix? According to Money Saving Expert Martin Lewis, even those wanting price certainty shouldn't be fixing at a rate more than 30% over the current price cap. This is based on predictions for the price cap for October and January from energy analysts Cornwall Insight, but excluding predictions for April 2023, as it's too far away for a decent forecast.
Currently there are no open-market fixed deals close to being at the right price. The cheapest is 39% over the price cap. But three energy companies are offering fixes of 30% or less above the price cap for existing customers only. So if you already get your energy from British Gas, EON or EDF, you might think they are worth considering for peace of mind.
But remember, the prices quoted for both the price cap and the fixed rates are based on an average household's use. If you use more, you'll pay more. If you use less, you'll pay less. It's also worth noting that the term fixed-rate refers to the tariff, not the price you will pay. So even on a fixed-rate tariff, your bill (and direct debit) will change according to your use, although the rate you pay for each unit and standing charge will remain fixed for the agreed term.
Here's what's on offer:
EDF
Tariff name: Fix Total Service May24v3
Fix length: Two years
Price: 24% more. £2,444 a year
Exit charge: £300
Who can get it? Customers on its standard variable tariff or those on a 'deemed' tariff.
Tariff name: Fix Total Service May24v4
Fix length: Two years
Price: 24% more. £2,444 a year
Exit charge: £300
Who can get it? Customers on a fixed deal that's ending in the coming weeks.
British Gas
Tariff name: Exclusive May 23v1
Fix length: One year
Price: 26% more. £2,480 a year
Exit charge: £150
Who can get it? Only available to customers who were moved to it after their old supplier went bust.
EON/EON Next
Tariff name: Fixed Online v14 / Next Online v14
Fix length: One year
Price: 30% more. £ 2,571 a year.
Exit charge: None
Who can get it? A ll existing customers.
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