No such thing as a quick fix

Published:
11 January 2008
Topic:
News,Gas & Electricity

With energy price hikes continuing for the foreseeable future, what should your next move be?

As the news of npower's 17.2% gas price increase and 12.7% electricity price hike grabbed headlines last week, one provider was able to quietly withdraw one of its most competitive products.

ScottishPower's PriceFall product offered new customers a guarantee that prices would not rise until November 2008. Last week however, this product was taken off the market - and this just a month after Scottish & Southern withdrew its own Price Fix 2008 deal, which was briefly the most competitive in the UK.

So just when consumers were hoping to fix their tariffs with more price increases on the agenda, two of the leading fixed products have been scrapped. So what should your course of action be now?

Well, there are two trains of thought.

The first is that you should move to the cheapest tariff in your area as quickly as possible. You can do that by comparing deals through our gas and electricity comparison tool, and in the process earn yourself a neat £30 cashback. 

Although the rest of the market is expected to increase energy prices imminently, getting on one the cheapest tariffs now could be an excellent move.

For example, when Npower increased its prices they terminated their best product (SOL 8) and replaced it with SOL 9. This meant that those quick enough to apply for SOL 8 will remain on that tariff and benefit from some of the cheapest rates we have seen in the last 12 months. However, those applying for SOL 9, i.e. new customers, will be paying more than £150 a year extra.

This is the same approach other providers should follow. If they do, you're quids in. If they don't, you simply apply for an alternative product.

The other option is to sit tight because even though the providers will be increasing most of their standard and online tariffs, they're also likely to introduce new fixed deals to grab your business, however, I expect these to be a lot higher than 2007 prices.

The problem with this approach is that you'll be paying more out now, at what is traditionally the most expensive time of year for heating bills. However, it will save you the hassle of moving around twice.

Whichever option you choose, keep your eye on the market and don't pay more than you have to.

DISCLAIMER: Please note that any rates mentioned in this article applied at the time of writing and may no longer be applicable today.

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