Why it's time to fix your energy bills

Published:

10 August 2010

Topic:

News,Gas & Electricity

The cheapest fixed rate gas and electricity tariff on the market has just been pulled and energy experts are predicting more deals will be withdrawn in the next few weeks.

After a lengthy period of falling bills, and with wholesale energy costs rising, increases have been on the cards for a while. Here at moneysupermarket.com, we've been urging people to consider fixing their bills while the best deals are still cheap - and now it's even more urgent.

Energy giant npower has just removed its Go Fix v2 tariff, the market-leading fixed rate deal. It had an average annual bill of £902.38 - the next best deal now is the New Energy Fixed tariff from OVO Energy, with an average bill of £926 a year.

The writing's on the wall

Scott Byrom, moneysupermarket.com's energy manager, said: "The writing has been on the wall for a while now; in the wake of recent tariff withdrawals and price increases to leading gas and electricity tariffs. So, it's no surprise that the market-leading fixed deal has now been withdrawn."

He warned that the price of wholesale energy will continue to go up, so other cheap energy deals are likely to be withdrawn soon.

He said; "It's a kick in the teeth for hard-pressed bill payers, but it is safe to say the best deals will only continue to go up in the next few months."

Should your household fix?

With bills likely to rise, you may well be considering a fixed tariff so that you are shielded from further price hikes, especially with the colder winter months just around the corner.

However, you do pay a little more for that peace of mind. The best fixed deal from OVO Energy costs £926 a year on average but the cheapest energy deal overall is E.ON's SaveOnline v2. It has an average annual bill of just £882.

So you may prefer not to fix your energy bills and to take advantage of cheaper rates now, but remember that these could increase in coming months.

Time to switch

Frustratingly, many people in the UK fail to switch energy provider to take advantage of the cheapest deals.

That means they end up paying hundreds of pounds more for their energy than they need to. If you're on a standard tariff then you can save money by switching - and some of the figures are pretty startling.

For example, if you're a Scottish Power standard tariff customer then you're paying an average bill of £1,289.54 a year. If you switched to E.ON's SaveOnline v2, you could save £406.83.

To put that in perspective, you can get seven nights all-inclusive at a four-star resort in Greece for £442 over at travelsupermarket.com just now. That's just £35.17 extra.

Even if you think your provider has great customer service and want to stick with them, you could still save money compared to a standard tariff.

For example, if you're a Scottish Power standard customer then you could save £374.53 by moving to its Online Energy Saver 10. If you wanted to fix, you could still save over £60 by moving to its Platinum Fixed Energy tariff - plus you'd be insulated against future rises.

Here's a run-through of the standard, fixed and best deals. Don't delay switching, or you risk energy bills burning a major hole in your pocket this winter.

Provider	Average standard tariff	Average online/best tariff	Fixed tariff
British Gas	£1,157.27	£898.82 WebSaver 8	N/A
EDF Energy	£1,158.57	£903.74 Online Saver V6	£1,098.96 Annual Fix V3
E.ON	£1,151.63	£882.71 SaveOnline V2	N/A
npower	£1,196.33	£889.73 Sign Online 19	N/A
Scottish Power	£1,289.54	£915.01 Online Energy Saver 10	£1,226.75 Platinum Fixed Energy
Scottish and Southern	£1,158.76	£981.83 Go Direct 5	£1,072.36 Price Fix 4
First Utility	£1,074.37	£954.14 iSave V4	N/A
OVO Energy	N/A	£926.18 New Energy Fixed	£926.18 New Energy Fixed

Sourced by www.moneysupermarket.com 09.08.2010

Related Links

• Compare tariffs from UK gas and electricity providers