Fixed v Vari Fair

Mikey17

Hello I very recently switched to Bulb vari fair when my fixed deal with Npower finished. A couple of weeks ago, Bulb said my bill would be rising 20 % because of wholesale price rises.
After doing another comparison i would be paying the same amount if I switched to EDF 2 fixed.
I realise no one has a crystal ball, but would it be fair to assume prices will not tumble over the next 2 years but rather increase further.
I appreciate your thoughts

MoneySavingAtWork

A look at some comparisons for my own usage found that the leading variable tariffs were generally still cheaper for me than the leading fixed ones, but whether that trend applies to you would depend on your own personal usage.

There are a few ways of looking at this. A key question is do you want the security of knowing your prices wont change long term, or can you justify slightly lower initial rates with the possibility they could skyrocket? Is just down to personal preference.

System

It seems to me that the rules of the game have now changed with the introduction of the Ofgem Cap. All tariffs will now have a ceiling set by Ofgem and one of the consequences of the Cap will be a narrowing of the price difference between fixed and variable tariffs. Someone has to pay for shareholder dividends.

As far as a variable tariff is concerned, any supplier that has already set its variable tariff close to the upper limit set by Ofgem can do nothing about increasing the tariff until the Cap is reviewed in the coming April/October. If, in its wisdom, Ofgem raises the cap by say 5% in April 19, then we can expect all variable tariffs to increase by this amount.

The only real advantage of fixing today is that it is a 12 month rather than 6 month price fix; however, by April most of us will have used 75% of our annual energy consumption so the savings advantage is marginal.

FWIW, I have a dual fuel tariff with Octopus then ends in February 19. I might well be switching to a variable tariff for a short period depending on fixed and variable prices at that time.

I may be wrong: this is just how I see it.

Mikey17

Thanks for the replies, much appreciated. I didn't realise about the ofgem cap, that was very useful info.

One last thing confuses me,my last switch was done through this site, the cheap energy club.

If i do a new comparison the cheap energy club says the 1 year fixed with EDF will cost me £ 200 more than i currently pay with Bulb, while other sites ( Uswitch, Energyhelpline and Moneysupermarket ) say i will pay the same as i do now. This does not take into account the 20% increase coming in November with bulb

If i log into the cheap energy club as a brand new customer the cheap energy club quotes the same as all the other comparison sites, how can that be ?
I hope that makes sense.
Cheers