Martin Lewis has told people to check their energy tariffs immediately to see if their bills have rocketed - despite the price cap falling last week. The Money saving Expert took to Twitter to urge those on fixed-rate contracts to check if their energy rates had 'rocketed'.
In his tweet, Martin explained that the new Ofgem price cap had been reintroduced on Saturday - this dropped the average annual bill to £2,074 from the previous cap of £2,500.
However, Martin explained that some people could actually be paying a lot more as those who had locked into expensive fixes last year lost their "Energy Price Guarantee' subsidy".
Some people locked into really expensive fixed-rate deals last year before the Government's energy price guarantee was announced. This was likely because they were unsure of what was going to happen to energy bills at this point.
Most of these fixes are over the current cap of £2,074 and some most likely went as high as £2,800. If this was the case, the Government's Energy Price Guarantee cut these fixes to £2,500 - but as the price guarantee has come to an end they will have returned to their original rate.
If this is you, Martin said you can ditch these fixes and move onto a cheaper one. However, you may likely face early exit penalties for doing this, the Mirror reports.
In his tweet Martin said: "On Sat, those who locked in on costly fixes - usually c.1yr ago - lost the govt
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"If so you will see rates jump to substantially more than the price cap rates.
"So check if your fixes rates have changed. If so, and it's materially higher than the cap rates you should consider ditching the fix and moving to your provider's price cap (though factor in any early exit penalties)
"PRICE CAP RATES:
"Average direct debit price cap rates from 1 July
- ELEC. Standing charge: 53.0p/day Unit rate: 30.1p/kWh
- GAS. Standing charge: 29.1p/day Unit rate: 7.5p/kWh
"Yet this varies by region (and doesn't apply to N. Ireland) and how you pay."
When asked whether it was illegal, Martin added: "No people fixed at a high rate. The govt then subsidised it after they'd taken it out - they are now returning to the initially contracted rate."
Martin Lewis fans flocked to tell the Money Saving Expert about their experience of this. A follower @Nickhaywardshea replied saying: "I found that with British Gas despite fixing last year, they then moved us to a rate which was HIGHER than the price cap, arguing that the price cap applied differently for fixes."
Another user @InstaSim6 shared: "I did get an Email from Scottish Power about this before the new cap came into force, it was going to jump to about 50p/kWh for Elec and 14p/kWh for gas I switched to the Standard Rate immediately."
