Is This a Good Time to Fix Domestic Fuel Prices?

niktheguru

MK65 said:

Thanks to all for your replies and advice/opinions. The majority, both here and on another forum where I asked the same question lean towards fixing now before another expected increase in October - though @Inigo_Montoya 's "dissenting" reply is exactly why I asked the question in the first place, so thanks for that!

FWIW, I have gone for a fixed until March 2024 deal with British Gas via MSE's Cheap Energy Club - they quoted, (and I checked their figures on my current consumption), only about £5 more per month to fix when compared against my existing supplier's Standard Variable offer. The existing supplier was quoting £18 per month more than their Standard Variable to fix until August 2024.

If it works for you, thats great.
Not sure i would fix for 3 years. (unless no exit fee) But if its similar to what you're paying at the moment, and you dont want to go to a cheaper supplier then I suppose its a good fit for you.

JJ_Egan

Same question was asked in march 2021  , one user said don't fix prices will come down .

[Deleted User]

Just to add a further fact to this debate. Ofgem started a consultation in May which suggests that they are minded not to recommend an increase in the cap in October. My ‘guess’ is that as Ofgem is a quasi-Government department it has come under pressure from Ministers. The outcome of the consultation is due next month.

https://www.ofgem.gov.uk/publications/ofgem-consults-covid-19-costs-next-level-energy-price-cap

MK65

@niktheguru

I understand what you are saying about fixing for 3 years, (my chosen tariff does have exit fees), and I did consider that. However one additional thing that is important for me at the moment is being able to, (reasonably), predict my outgoings for the next few years as far as possible, (how much the outgoings actually are is slightly less important). If I had stayed with my existing supplier, then the monthly cost would have risen by up to 42%.

In the long run I might end up paying more, but at least I'll be able to plan my budget

[Deleted User]

MK65 said:

@niktheguru

I understand what you are saying about fixing for 3 years, (my chosen tariff does have exit fees), and I did consider that. However one additional thing that is important for me at the moment is being able to, (reasonably), predict my outgoings for the next few years as far as possible, (how much the outgoings actually are is slightly less important). If I had stayed with my existing supplier, then the monthly cost would have risen by up to 42%.

In the long run I might end up paying more, but at least I'll be able to plan my budget

I am not a great fan of long fixes. Energy suppliers will have built in an annual rate of price increases into their tariffs.
Remember, if the monthly DD is, say, £100 a year more than a one year fixed tariff, then you will pay that extra amount for 3 years. 

To put that into context, if a one year fix is £600 per year and a 2 year fix is £650 a year for both years, then the supplier has assumed that energy prices might be up to £100 more in year 2. This equates to a 100/600 x 100 or 16.6% increase. It follows that if the actual year 2 increase is, say, 10% then you would be better off paying £600 in year 1 and £660 in year 2.

Carrot007

MK65 said:

Because of some bad experiences with smaller suppliers in the past, (I can remember back to the home energy deregulation in the late 1980s or early 90s), I prefer to stay with the big names - even if it means paying a little bit more, (not always more though!). I also prefer to have a single supplier for both - again, just my preference.

Not to question you memory but.

Deregulation happened 1.10.1997. And was not in any way working until 1.4.1998  at the earliest. And there were no new suppliers (excepting british gas in the electric market, and the others vice versa) until 2000ish.

Of course it probably seems like longer!

bristolleedsfan

MK65 said:

@niktheguru

I understand what you are saying about fixing for 3 years, (my chosen tariff does have exit fees),

B.Gas tariff you chose has very reasonable standing charges that effectively make up for the exit fees should you decide to switch out early. comparing with Octopus Energy no exit fees 1 year and 2 year fix in my region

British Gas standing charges for both fuels are £58.31 less per year

British Gas E KWH rate is 0.95pkwh less

However British Gas ( gas)  is on the high side 4.148p kwh ( Octopus gas fix is 3.65p kwh)

bristolleedsfan

Dolor said:

Just to add a further fact to this debate. Ofgem started a consultation in May which suggests that they are minded not to recommend an increase in the cap in October. My ‘guess’ is that as Ofgem is a quasi-Government department it has come under pressure from Ministers. The outcome of the consultation is due next month.

https://www.ofgem.gov.uk/publications/ofgem-consults-covid-19-costs-next-level-energy-price-cap

I read this,  "Ofgem is consulting on its proposal that no further adjustment is required to account for the impact of COVID-19 for the default price cap from October 1 2021"
as meaning that Energy cap set for October 2021 proposal will not include an  add-on to help suppliers cover the costs of unpaid bills during the pandemic  ( add on was £23 April 2021 cap level) Energy cap will increase in October due to high wholesale prices

MK65

@Carrot007

Was it really as late as that? Two companies that I can recall having issues with at the time were Northern Electic/Gas and Calortex.

@bristolleedsfan

I found similar to you when I was checking British Gas' costings. In terms of kwh, we use considerably more electricity than gas - 3 of us in the house with computers and TVs on for much of the day! That seems to be why this tariff works out cheaper than my current supplier's new offer.

I may well consider splitting the two fuels between different suppliers, (as suggested), next time round, but for now I am happy with my choice.

Thanks to everyone who replied for your input