With the future for energy costs looking unclear, and some good deals around, now may be the time for us to fix
We all need to stay warm this winter, but Ofgem, the body that sets the energy price cap, has announced that from October 2025 the price cap will rise.
Households on variable rate energy bills will be paying £35/year more and bringing the average household bill up to £1,755. That’s enough to give us all the chills.
The situation may get worse, with money experts very uncertain about the future direction of energy prices. There are lots of big unknowns in the energy world at the moment. Predictions range from a slight decrease in the energy cap next April, up to another £100/year increase.
According to a recent survey by financial website totallymoney.com, 22 million households are on the standard variable rate. This is the most expensive way for us to buy energy, so the big energy companies are coining it.
Richard Neudegg of switching comparison website Uswitch told Quids in! “If you haven’t switched energy in a year or more, it’s likely that you’re on a standard variable tariff. This means the rates you pay will change with the price cap, which happens every three months. The good news is there’s a range of fixed deals available that will protect you from these changing prices and save you money.”
Fixed vs variable
Most people are on the standard variable rate for their energy supply. This means that when prices go up or down, so do their bills.
A fixed rate is different, and is a price we have agreed with the energy company for a set amount of time, usually one or two years. This means that even if energy prices go up, the amount we pay will stay the same for as long as our fix lasts.
Can we fix It? Yes, we can
There are lots of places where we can fix our energy, and the best way is to use a comparison website. We can save ourselves on average around £150 per year by doing this now.
Martin Lewis from moneysavingexpert.com has an energy comparison website that is good to use, because it does not hide results that it doesn’t make money from.
There is some good news. Anyone on means-tested benefits will automatically receive the £150 Warm Home Discount on their bills this year. Some previously did not qualify owing to the size of their property, but that condition will be scrapped.
For more winter payments up for grabs, click here.
Image: Age Without Limits/Elliot Manches
