Is it worth cancelling my fix?

Beki88

I'm on a long term fix (nPower Price Protector March 2017) but out of curiosity I decided to have a look using the cheap energy club at what other deals were available. After doing so I am sooo confused, as fixing slightly shorter eg until April 2016 saves me £345 a year! (gas and elec combined).
Current spend per year is around £1550 so with the saving it takes it to £1200.
I'm trying to work out if that means I'm better off swapping and then dealing with the increase earlier or not. I can't wrap my head around the figures so hoping someone can help! Thanks

JJ_Egan

You pay a premium for each years fix .

Comparison make sure your years usage figures are correct then use a comparison site . Double check with a different comparison site . Factor in any penalty for leaving the contract early and decide .
Current prices have been static to slightly downwards .

polymaff

Beki88 wrote: »

I'm on a long term fix (nPower Price Protector March 2017) but out of curiosity I decided to have a look using the cheap energy club at what other deals were available. After doing so I am sooo confused, as fixing slightly shorter eg until April 2016 saves me £345 a year! (gas and elec combined).
Current spend per year is around £1550 so with the saving it takes it to £1200.
I'm trying to work out if that means I'm better off swapping and then dealing with the increase earlier or not. I can't wrap my head around the figures so hoping someone can help! Thanks

Don't be spooked by the idea of skipping from fixed to fixed tariff. I've been doing it month by month recently as better and better tariffs come along. Just be sure of your expected annual kilowatt-hourages and go fishing at CEC. The best switches for me have been within my supplier, recently, so no switching bonuses paid , but on the other hand it has been totally easy to instantly switch.

Exit penalties limit your scope for switching - but might still be worth paying, especially if covered by the switching bonus.

AndyPK

first do a manual check yourself using the kwh and standing charge figures and see if the new tariff is a better deal (it probably is, but comparison sites can't always be trusted).

If its ok, then yes transfer. npower usually doesn't have an exit fee.

The long tariffs are expensive.

You can then use their website, or telephone them to change.

You can also mix tarriffs, so have April for gas and jan for electricity to suit you best.

Beki88

Hi thanks for the replies.
I used the figures on my annual statement, also added a few years up and worked out an average and it was pretty close to the original figure.
There are no penalties to exit the fix I am on.
I've checked on several comparison sites and also directly and all roughly the same saving.
I just want to make sure that in the long term it's better, not sure how to explain how it's in my head but I keep thinking I'm losing a year but will that matter if I save now, do the savings outweigh the potential rises between now and then etc.
If I am saving £300 per year thats £600 over 2 years and I doubt the prices will rise by that much so still better off. Probably making little sense by now haha so thanks for sticking with me

teddysmum

I don't use long term fixes, as you never know what may happen and the amounts are so much higher that you need a large price rise before you break even.


I was on nPower's November 2014 fix (one year), but as November 2015 was better for both fuels, transferred early, there being no fee to pay.


However, the next one year fix, January 2016, was cheaper for both on unit cost, but whereas gas was cheaper on standing charge, electric was much more. The only way to gain on this being to have very high usage, so I've left the electric on November 2015 and transferred the gas.

polymaff

Beki88 wrote: »

Hi thanks for the replies.
I used the figures on my annual statement, also added a few years up and worked out an average and it was pretty close to the original figure.
There are no penalties to exit the fix I am on.
I've checked on several comparison sites and also directly and all roughly the same saving.
I just want to make sure that in the long term it's better, not sure how to explain how it's in my head but I keep thinking I'm losing a year but will that matter if I save now, do the savings outweigh the potential rises between now and then etc.
If I am saving £300 per year thats £600 over 2 years and I doubt the prices will rise by that much so still better off. Probably making little sense by now haha so thanks for sticking with me

In the end, who knows what the future holds? There are all sorts of ways of saving though - and if "roughly the same saving" means only £25 - would you walk past £25 lying on the pavement?

You can also save by accumulating switching bribes. You can also save by switching to a lower standing charge / higher unit price during the warmest six months and vice versa in the coldest six.

It all adds up.

Pincher

Short fixes have been very good for the last five years for me, but I am anticipating a window of opportunity for long fixes.


Crude oil is now below US$70 per barrel, and it's sinking like the Titanic. There is a theory, that OPEC is dumping oil to bankrupt shale companies. Shale production is expensive, and only came into being because of US$100+ oil price, and need it above US$80 to operate profitably.


So, if the shale companies do indeed go bankrupt, the competition disappears, and the oil price goes back up.


I am hoping the energy companies will hire some morally bankrupt MBAs (alright, any MBA) who cares nothing for long term shareholder value, and brings out five year cheap fixes of say £1,100 a year for average consumption. Customers switch in, Sales go up, the MBAs grab their bonuses and run. One year later, all the futures contracts are used up, and the energy companies start losing money on all the long fixes.


So, let us say short fixes bottom out at £900 a year for medium consumption, around April. The MBAs bring out a £1,100 five year fix in April 2015, which is a £200 premium over the short fix, so no shareholder will complain. I now switch to the five year fix from a short fix, preferably with a £100 cashback. The shale companies start collapsing from May 2015, and oil prices start shooting up, so short fixes also move up, £1,000, £1,100, etc. Let us say it stabilises around £1,300 in 2017, but I will be on five year fix at £1,100 until 2020.


Don't wake me, it's such a sweet dream.