Still confused on what capped actually means

andrew71

Please forgive me for my ignorance and if this has been asked umpteen times. Regarding Capped what exactly does it mean? By that does it mean the utilities company work out how much we've used over the year then set a price for the year? Or does it mean something totally different?
I would presume it doesn't mean they set a price and no matter how much we use the price never goes over that cost?

fightyfish

hi,
In my experience a 'price cap' differs from a 'fixed price' tariff in that your prices can go down if standard prices decreased. So if your tariff was 'capped' 5% below a company's standard price you would be unaffected by a price rise and if prices went down 10% you would also get a slight decrease. Alternatively if your prices are 'fixed' at 5% below standard then they will not change regardless of what the company do with the standard and a price decrease could see you paying more money than someone on a standard tariff.

In all these cases the prices they are referring to are the prices per unit of energy rather than a fixed monthly payment, so if you used more you would still pay a larger bill than someone who used less.

andrew71

Thank you that is what I had in my head but I started to question myself

I am now looking on price comparison sites regarding gas/electric. Our current supplier (N Power) have our bill online with an estimation for the next twelve month. Would I be correct in putting in N Powers estimated cost per month for usage or what we have used previously?

Nada666

Put in your estimate of what you will use over the next year. (Use their prediction if it seems reasonable or you have no idea.) And use kWhs over a year, not money per month.