Should I get fixed rate or variable?

vertex

Hi
Just getting quotes for electricity supplier from USwitch/Compare The Market.
Should I get a Fixed tariff (Im look at one from Green Energy Network for 18th months) or variable? The fixed quote is working out at being 1p per kwh more than the variable rate.
Just wanting to gauge form people on here whether energy prices are going to rise and if its worthing going for the fix tarrif.
Thanks

Neil_Jones

A fixed rate means your unit rates (N.B. not your direct debit figure) is fixed for that period of even if for argument's sake wholesale prices tripled in April, you'd be safe from them until your deal ran out.

A variable rate means it can go up or down but the overall trend is upwards, so a fix now may look incredibly cheap in 18 months time.

Remember you can still switch from fixed tariffs if the market does happen to go down subject to exit fees, but the saving would have to be quite high to make it worthwhile.

vertex

Thanks Neil. I didnt explain myself properly. I understand what Fixed Tariff is. I just want to gauge whether the knowledgable people here on the MSE forums think the rates might go up over the next 12 months. And if they do whether its worth fixing for an extra 1p per kwh.

apt

It is guesswork, but forward prices for gas don't currently indicate prices going up like they have over the last 2 years. For me bulb with £100 off for a referral was a lot cheaper than the fixed price options. If they raise their prices I'll move and pick up another referral or cashback reduction. Also keeping my eye open for a really good fixed rate offer, but there aren't any at present.

glennevis

It's not just about whether the variable tariff will go up. Does the variable tariff have an end date? If not the supplier could cancel it at any time and you end up having to pick a new tariff or you'd being bounced on to their standard variable rate.
This happened with Solarplicity last October.

Thomas_Edison

With the warm winter prices have been going down, recently they've been at unusually high levels due to the lingering effects of the beast from the east last year, so generous I'm expecting prices to fall

philng

I am sensing prices in short term may fall as my renewal with AVRO is showing a 20% increase on last year & yet is still one of the cheapest on the market.

I am considering renewing as taking a FIXED rate with no cancellation charge for me is the best way to go as if rates do fall I can switch away at no cost.

Atomicsnail

I went with bulb who don't do fixed rates. For me they were the cheapest unit rate and I made use of a £100 referral. 2 people have used my referral code so far with a deal I was offering to use my code. So that's covered over 2 months of my direct debits.

philng

As I suspected evidence of recent small reductions on fixed rates. Just renewed with AVRO on New Simple & Prime Fixed tariff only released yesterday and £25 less per year than their previous fixed rate.