Anyone not fixing?

jingleberry

backfoot wrote: »

Just modelling on some fairly aggressive assumptions, I think you may pay 15% more for the duration of the fix.

Then again, my aggressive assumptions may be way off the mark, either way.

I favour your historical approach.

I hope you are right, because energy price rises feed into all sorts of things that cannot be hedged against, so we will all be better off if prices are constrained. However I dont understand your logic. My current bill is £100pm. I'm fixing for 3 years at £125pm ie a 25% increase. You project that I may overpay by an average of 15%, so I think you are predicting that someone paying a £100 bill now will pay an average of £106 over the next 3 years if they stay on the cheapest variable contract. (£125 less 15% = £106). Surely the forthcoming round of price rises, triggered by the Scottish Power announcement, will increase prices by more than this on its own?
I'm no expert, and I am still in the cooling off period for my move so if my thinking is flawed, i'll be very happy to have my hat put on straight.

davethorp

backfoot wrote: »

Is that the correct comparison though?

For me, compared to SP direct, the EDF September 2012 fix represents an additional 15% premium, to fix for essentially a year once the switch has completed.

Until SP put up the price you will pay that premium per month. We might expect SP to do the dirty and increase the price for the winter ,in say, November.

I guess, this one will be pretty close to break even,maybe you will pay a bit over for fixing.

The Scottish Power tariff wasn't there when I compared the other day. Even so for my use it's only 5% cheaper than my fixed price with EDF and could well rise.

I probably wouldn't consider Scottish power anyway after they slammed my supply a couple of years back

LittleMissAspie

We're on a deal with Scottish Power that ends in October. The deal tracks British Gas prices so I just have to hope BG are slow with their increase!

After the deal finishes I need to switch our meter from E7 to a normal one, that will save us money whichever supplier we are with. SP won't switch it for free so I'll just find the best deal with a company that will. SP do tend to be the cheapest supplier in this area though, but I'll just have to see what I can do at the time.

backfoot

Jingleberry,

Sept 2011.

Let's make an assumption that even on the newly introduced tariff, SP put up prices by 10% and thereafter at 10% p.a.

Fixed Price 1500 p.a. (125 p.m).

Total cost to Mar 2014 = £3750.

Variable cost :

Year 1 to Sept 2012 = 1320
Year 2 to Sept 2013 = 1452
Year 3 to Marc 2014 = 798

Total cost to Mar 2014 = £3570.

Difference 3750- 3570 = £180.

Which is around 5% increase. (not 15%, apologies).:o

Anyway,play around with the percentage increases or when you believe the SP first increase will be. The main point being that until the 25% premiumis fully used up ,only then do you start to claw it back.

Most people think that if prices rise by 25% over the period then they have made the right decision,which isn't correct.

schrodie

I've fixed with EDF until 2014 in the assumption that the chances of energy prices coming down are highly unlikely given the current climate of these tiresome green initiatives and other "expenses" energy companies have to take on board coupled with the fact that these energy companies have shareholders to please.

Also it's one area of my financial life that I know is fixed until 2014 which makes budgeting somewhat less fraught.

backfoot

davethorp wrote: »

The Scottish Power tariff wasn't there when I compared the other day. Even so for my use it's only 5% cheaper than my fixed price with EDF and could well rise.

Looking closely at the structure, the SP tariff favours high users especially on gas.

Explains why it is much more advantageous for me than yourself.(and Milliscent)

Important for everyone to do their own calculations.

NPowerUser

Opted for NPower GoFix5
http://www.energyhelpline.com/fri/fri/Domesticenergy/Domestic/TariffDetails?GasTariff=425659&ElecTariff=425603&RegionCode=13

Seemed a no brainer, pay a 6% premium on the gamble rates go up bigger than 6%, fixed to 31st May 2012.

I would never fix greater than just over a year or so as prices could move down at some point. I cannot see the governemnt allowing 10% annual increases indefinitely, people on fixed incomes would die.

realised

We're not fixing either. We live in a flat and are low users only costing us about £50 a month for gas and electricity. However, I shall be looking at my parents bills and probably fixing for them.

jingleberry

backfoot wrote: »

Jingleberry,

Sept 2011.

Let's make an assumption that even on the newly introduced tariff, SP put up prices by 10% and thereafter at 10% p.a.

Fixed Price 1500 p.a. (125 p.m).

Total cost to Mar 2014 = £3750.

Variable cost :

Year 1 to Sept 2012 = 1320
Year 2 to Sept 2013 = 1452
Year 3 to Marc 2014 = 798

Total cost to Mar 2014 = £3570.

Difference 3750- 3570 = £180.

Which is around 5% increase. (not 15%, apologies).:o

Anyway,play around with the percentage increases or when you believe the SP first increase will be. The main point being that until the 25% premiumis fully used up ,only then do you start to claw it back.

Most people think that if prices rise by 25% over the period then they have made the right decision,which isn't correct.

Yes I agree, if the price of the cheapest variable rate contract rises by 10% pa, starting immediately, I will be about £180 worse off by March 2014.

deutsch

to fix or not to fix?
does anyone take into consideration inflation? (CPI/RPI)