I am on the Southern Electric Fixed Tariff which ends in November 2008. I recently used the MS calculator to see how it fared and it showed up as £90 cheaper than the cheapest tariff. I assume that's on an annualised basis so means £45?

I don't understand how to work out whether I would be better off switching to a new Fixed Tariff sometime soon which may not be cheaper for six months but over say two years may be much better value bearing in mind that a deal now may be more attractive than one I may be able to do in November. As far as I am aware apart from twenty eight days notice there is no penalty switching before November. The joker in the pack is that I would be very reluctant to switch away from Southern Electric. Conversely I would be very reluctant to carry on living if I had to go back to npower! :-)

Can you help? Ty

drumster,

Southern Electric 'Price Fix 2008' is a fantastic tariff. It was the 2nd cheapest product on average in 2007 but was made more attractive due to the fact it was "fixed".

I can see why you wouldn't want to move away from Southern Electric. The group as a whole, Scottish & Southern, are renowned for providing market leading customer service as well as competitive prices. Its corporate strategy to delay passing on price hikes, as we saw this year, is also encouraging to see.

However, unfortunately, at this moment in time, the provider does not offer a "fixed" tariff.

The situation you are in is a tricky one. At the moment you are on a very cheap tariff until Nov 08 but you don't want to miss the chance to get on a different "fixed" tariff now if they are likely to be more expensive by the end of the year.

If you move now you will probably be looking at an increase of +£250 to go on a long-term fixed tariff i.e. until 2011. On an average bill for 'Price Fix 2008', £250 would equate to a 30% increase on your energy bills. In the current market, rumours are that we are going to see further price hikes in 2008 of circa 15 - 20%. On this basis, moving now doesn't quite seem feasible.

Whether prices will again continue to increase in 2009 I simply couldn't say. However, I'd expect long-term contracts to be introduced at some point in the near future and with this, if they follow Ofgem's intentions, we "should" see prices fall as providers can be assured of "keeping hold" of customers for longer meaning they can buy more energy in advance and therefore reduce costs.

By all means look around for other opinions but mine right now would be to sit tight with Southern Electric.

Hope this helps.