Energy bills have risen by 27 percent since last October even with the introduction of the Government’s price guarantee. New analysis from Uswitch is highlighting that suppliers could be close to offering fixed-rate deals below the guarantee’s £2,500 threshold.
What is a fixed-rate deal?
These tariffs are used by households who are looking for the best way to ensure their energy bills are at an affordable level every month over one-to-two years.
This is to make sure that consumers are not seeing the prices they pay fluctuate due to changes in the market.
It should be noted that this does not mean that energy bills for households will be the same every month as households lock down the price per unit of gas and electricity, not how much they use.
Around four million families in the UK are currently on fixed deals, compared to 27 million on variable tariffs, which is down more than half from October 2021.
Suppliers could soon be offering fixed deals costing between £2,200 and £2,500, according to Uswitch.com.
Research carried out by Uswitch.com found that seven in ten households want the option to sign up for a fixed deal now.
Around 33 percent of those billpayers in the UK are wanting more certainty when it comes to their gas and electricity costs.
Some 56 percent of those paying energy bills would prefer to be on a fixed deal to help reduce how much they are spending, with two-fifths of those polled wanting to so before the end of this year.
Notably, 78 percent of suppliers said energy suppliers should do more to bring back fixed deals, while over half want more Government intervention.
In light of this, Uswitch is urging energy suppliers to begin offering fixed deals as soon as possible so households can reap the benefits of a competitive market.
Richard Neudegg, the director of regulation at Uswitch.com, outlined why suppliers have no good reason to not start lowering wholesale prices.
He explained: “Households have been witness to a rollercoaster of price rises and uncertainty over the last couple of years, while relying heavily on temporary measures such as the Energy Price Guarantee in order for costs not to spiral further.
“And although energy costs remain historically high, bill-payers deserve the freedom to choose a fixed deal if they feel it is their best option.
“For many energy customers, it is not just about the money. Many are stuck with their supplier and lack the ability to vote with their feet and move to one offering other benefits such as better customer service.”
The energy expert warned that families will need to consider all factors when locking onto a fixed-rate deal.
Mr Neudegg added: “With current price cap predictions for July at £2,153, households will need to think carefully before committing to a fixed deal in the coming months.
“Some may want to lock in the certainty of a lower price sooner, ahead of next winter, and others may wait to see what happens to the market..
“Energy suppliers should ensure that consumers can reap the benefits of a lower wholesale market by bringing back fixed deals now.”
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