Fixed Price

[Deleted User]

Has anyone switched to a fixed price tariff and then monitored the variable tariffs for the duration, to see how much they saved if anything?

At the moment the media are mooting a rise of 8%. If I assume the same rate of inflation thereafter, the cost of not fixing is as near as dammit the same as fixing with Npower for the next four winters. (More, if I include the £50 cancellation fee.)

Bluebirdman_of_Alcathays

jack_pott wrote: »

Has anyone switched to a fixed price tariff and then monitored the variable tariffs for the duration, to see how much they saved if anything?

At the moment the media are mooting a rise of 8%. If I assume the same rate of inflation thereafter, the cost of not fixing is as near as dammit the same as fixing with Npower for the next four winters. (More, if I include the £50 cancellation fee.)

The fixed price is an insurance policy against future price rises. If you fix and Armageddon breaks out in the Middle East, you win. If the fracking revolution transpires, and prices go flatter than a witches t!t, you lose.

If any of us could guarantee what would happen, we would all choose accordingly. Alas, life isn't like that

nickcc

Just in the process of switching to NPower from BG. Works out roughly 15% more for the initial switch but over 4 winters should be considerably cheaper.

macman

nickcc wrote: »

Just in the process of switching to NPower from BG. Works out roughly 15% more for the initial switch but over 4 winters should be considerably cheaper.

How can you know that? If we assume (a big if) that BG will follow SSE and increase 8.2% this winter, and a further 6.8% next winter, then their price will be roughly at the same level from 10/14 as you are paying from now. But in the meantime you'll have paid a higher rate for a full year on Npower. You won't recover that differential until a further BG increase in late 2015.
You might be ahead by 2017, or you might not. What you have done is paid a 15% premium for an insurance policy.

NittyGritty

macman wrote: »

If we assume (a big if) that BG will follow SSE and increase 8.2% this winter, and a further 6.8% next winter, .

think its safe to say prices are on the rise each year, and just because SSE made official satatment of just 8.2% that does not mean a unit price increase of that amount on you tariif, it could be a lot higher, maybe double the 8.2% in some cases, so it would make a longer fix even more tempting in my eyes, rather than fix each year
as by the time it comes to move after a year to a new tariff, your going to pay an increased price again, so its a double whammy each year, as each new tariff is another price hike

lets take SSE figure of 8.2% putting an extra £100+ on your bills, now lets say for some people whos figure is more around 15% in true unit price increases, (and yes the proof is on this thread from last year) some were even 20+% increase in real terms,
which adds even more over the year in new bills, your suddenly looking at £150-£200, now long term fixes don't look that bad at all, you just have to do your maths and if you want peace of mind of knowing NO increases for 4 years. an example my current night rate is 5.7p for electric,now id hate to think what it would be in 2017, most suppliers are already in the 7p range pushing 8p now in some areas/tariffs

Doshwaster

Bluebirdman_of_Alcathays wrote: »

The fixed price is an insurance policy against future price rises. If you fix and Armageddon breaks out in the Middle East, you win. If the fracking revolution transpires, and prices go flatter than a witches t!t, you lose.

If any of us could guarantee what would happen, we would all choose accordingly. Alas, life isn't like that

It depends on the cancellation terms for the fixed rate contract. In the unlikely event of the price does dropping through the floor it could well be be worth paying the exit fees.

So, as I see it the risk of not fixing is far higher than if you do fix.

Of course the next problem is what the rates will be when your fixed rate comes to an end.

My current plan with EON is coming to an end in a few weeks so with an inevitable price rise announcement coming up, in I've decided to lock in at current prices for another 12 months. It seemed to be a no-brainer to me.

nickcc

macman wrote: »

How can you know that? If we assume (a big if) that BG will follow SSE and increase 8.2% this winter, and a further 6.8% next winter, then their price will be roughly at the same level from 10/14 as you are paying from now. But in the meantime you'll have paid a higher rate for a full year on Npower. You won't recover that differential until a further BG increase in late 2015.
You might be ahead by 2017, or you might not. What you have done is paid a 15% premium for an insurance policy.

Because Martin has told me so.

Bluebirdman_of_Alcathays

nickcc wrote: »

Because Martin has told me so.

All hail the money saving man (that flogged his baby to a competitor for £87m)

nickcc

Bluebirdman_of_Alcathays wrote: »

All hail the money saving man (that flogged his baby to a competitor for £87m)

Not sure what you're implying, is Martin to be believed or not ? As this Forum was his baby and, as I understand it, he still has management control, should we accept his advice or not ? I can still cancel my supplier if you believe that Martins information is incorrect or can you offer an alternative ?

funnyguy

I have just taken up the 4 winter NPOWER [no cancellation fee] ,and they have given me £25 each bonus back on first monthly bill for gas/leb.[so £50]Was already on NPOWER online 2013[finishes this month]

cbrpaul

give it another 2 years for fracking to come through and prices will fall like a stone !!

that's why these energy companies are trying to get as much money now as later they will have to compete against it !!!