As the new year approaches, households are bracing for a slight uptick in energy bills due to Ofgem’s upcoming price cap adjustment. The increase, set at 0.2%, may seem minimal, but it could see the average customer facing an annual bill of around £1,758. However, there is a silver lining with potential savings of £150 annually from recent initiatives announced in the Budget by Chancellor Rachel Reeves.
To counter the impending rise, many households are opting for fixed energy deals, with approximately 21 million customers already on board, according to Ofgem. While fixed deals do not guarantee a static overall bill, they do lock in the unit rate for a specified period, leaving the total cost dependent on usage.
Switching to a fixed deal could mean substantial savings, with an average potential saving of £230 per year for customers on standard variable tariffs. The process of changing suppliers is quick and straightforward, and even existing smart meter users can seamlessly switch without any hindrances. A recent comparison by Uswitch.com revealed multiple fixed deals that are more cost-effective than Ofgem’s current price cap.
Among the top picks are Ecotricity’s EcoFixed – 1 Year Oct 25 v1, Outfox Energy’s Fix’d Dual Dec25 12M v1.0, E.ON Next’s Next Fixed 12m v107, and several others, offering competitive rates and varying contract lengths. Energy Secretary Ed Miliband has urged suppliers to pass on the promised savings to customers on fixed rates, ensuring reduced bills from April onwards.
Energy expert Suzanne Edwards from Uswitch.com recommends seizing the opportunity presented by falling wholesale prices to secure a favorable fixed rate before the price cap adjustment in January. By comparing energy deals, households could potentially save around £228 compared to the upcoming cap, making it a financially prudent move for those seeking to cut costs and stabilize their energy expenditure.