Ofgem
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Energy customers who don’t fix could be paying up to £250 more than needed

  • Fixed price deals could save consumers up to £250 a year compared to variable tariffs
  • Fixed tariffs currently offer lower rates, plus the added benefit of helping with budgeting
  • Ofgem rules ensure consumers can trust fixed price deals and they will be protected when these deals come to an end

Recent research from Ofgem has shown that the gap between average variable tariffs and the cheapest fixed tariffs is so wide most consumers would be better off on a fixed deal. Despite the recent cuts to variable prices, the potential saving of up to £250 means that most consumers would be better off moving to a fixed deal.

Ofgem’s research also found that some of the cheapest fixed tariffs were with independent suppliers with some fixed deals at around £915 per year, compared to £1,1651  for the average variable tariff with one of the larger suppliers. Around half of customers switching supplier now move to independent suppliers.

Ofgem CEO Dermot Nolan said: “While recent price cuts are a step in the right direction, many customers could be better off to the tune of up to £250 by moving from a variable rate to a fixed rate deal. If you’re not sure where to start, then I’d strongly recommend the Be An Energy Shopper website for an independent and impartial guide.

“We are seeing companies compete for consumers interested in taking a fixed price deal. However, we are not seeing rigorous competition between suppliers that benefits all consumers. Around 60 per cent of customers are on variable tariffs, and the lack of competitive pressure on prices for these customers is another reason why the Competition and Markets Authority is investigating this market. In the meantime, I would like as many consumers as possible to look for a better deal, as it’s never been easier to shop around for their energy.”

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Channel website: https://www.icaew.com

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