Fixed Dual Fuel Ending November HELP

HouseHoldSavings

So ive always been on fixed tariff with BG. Paying around £98 a month.

If im understanding correctly, i can risk not fixing in again and go to standard variable, and change before april, because itll go high!

OR Fix now before OCT 1st and lock in at around £127 a month.But what i dont understand is, If i dont lock in before OCT 1st will the next fixed quote be more?! please help, i really dont understand it.

Thanks

[Deleted User]

Spin a coin if you dont like the answer from that have the best of five. Alternatively if you can afford it sell up and move out of this horrible country as soon as possible

Neil_Jones

HouseHoldSavings said:

So ive always been on fixed tariff with BG. Paying around £98 a month.

If im understanding correctly, i can risk not fixing in again and go to standard variable, and change before april, because itll go high!

OR Fix now before OCT 1st and lock in at around £127 a month.But what i dont understand is, If i dont lock in before OCT 1st will the next fixed quote be more?! please help, i really dont understand it.

Thanks

Your direct debit is not your bill:

https://www.moneysavingexpert.com/utilities/lower-energy-direct-debits/

Second of all what you do depends on whether you want surety or not.  A variable tariff will almost certainly go up.  But if you find a fix, that rate (not your payments) is fixed for 12/18/24 months as appropriate.  If the wholesale price triples overnight and your fixed tariff rate wipes the floor with the rest of the market in three months time by some considerable margin, you are quids in.

HouseHoldSavings

Probably leaning towards a fixed tariff, as I may well forget come April and I like to know my bills.

So if i dont lock in before OCT 1st with the quoted £127, will the next fixed quote i get be more expensive? or does the 1st Oct not really matter?.

I appreciate this is unprecedented times.

[Deleted User]

HouseHoldSavings said:

So ive always been on fixed tariff with BG. Paying around £98 a month.

If im understanding correctly, i can risk not fixing in again and go to standard variable, and change before april, because itll go high!

OR Fix now before OCT 1st and lock in at around £127 a month.But what i dont understand is, If i dont lock in before OCT 1st will the next fixed quote be more?! please help, i really dont understand it.

Thanks

If anybody knew the exact answer about the future cost of energy, nobody would be in a mess right now, companies wouldn't be going bust and everyone would have fixed a cheap 2 year tariff back in April and we would all getting a good nights sleep in a warm house this winter.

Even the so called experts in the supply chain didn't foresee this coming so I doubt anybody on here can give a better prediction of what the next 6 months will hold.

Just do some scenarios - so say you have 2 months left on your £98 deal but you lock a 12 month fix now at £127. If fixed prices don't rise when your deal ends then you've paid an extra £58 as "insurance" against an increase. (£127-£98=£29 x 2 months=£58)**

However if the fixed deals goes up by a mere 4% increase ie £5 on top of that £127 to say £132 when your deal ends in November, you will pay more than your £58 "insurance" over the following 12 months - (£5x 12 months = £60).

So you've just got to guess really which scenario plays out, it doesn't take much of an increase for that fixing not to pay off but we may have peaked already, very hard to say.

Even if wholesale prices do drop, I'd guess suppliers are not going to be fighting for customers with the cheapest deals like they have done for the last few years and it will probably take a long time for those attractive tariffs to come back. All the remaining suppliers are bearing the costs of the smaller ones going bust to some extent.

If prices don't increase then you've potentially paid £56 extra for nothing other than peace of mind, if prices drop by more than £5 a month instead then you will probably cover your exit fees and be looking to switch early.

Having certainty in your costs might be more important than getting the cheapest deal so bear that in mind as well. The fact that you have "always" been on a fixed tariff with BG suggests you probably haven't always been on the cheapest tariff in the market either so just consider other suppliers although the big 6 seem a better choice if you don't want the hassle of your supplier going bust in the next few months..

**All the above assumes those monthly prices for last year / next year are done based on exact kWh annual usage and not your direct debit amounts which may not reflect actual usage.

HouseHoldSavings

Deleted_User said:

If anybody knew the exact answer about the future cost of energy, nobody would be in a mess right now, companies wouldn't be going bust and everyone would have fixed a cheap 2 year tariff back in April and we would all getting a good nights sleep in a warm house this winter.

Even the so called experts in the supply chain didn't foresee this coming so I doubt anybody on here can give a better prediction of what the next 6 months will hold.

Just do some scenarios - so say you have 2 months left on your £98 deal but you lock a 12 month fix now at £127. If fixed prices don't rise when your deal ends then you've paid an extra £58 as "insurance" against an increase. (£127-£98=£29 x 2 months=£58)**

However if the fixed deals goes up by a mere 4% increase ie £5 on top of that £127 to say £132 when your deal ends in November, you will pay more than your £58 "insurance" over the following 12 months - (£5x 12 months = £60).

So you've just got to guess really which scenario plays out, it doesn't take much of an increase for that fixing not to pay off but we may have peaked already, very hard to say.

Even if wholesale prices do drop, I'd guess suppliers are not going to be fighting for customers with the cheapest deals like they have done for the last few years and it will probably take a long time for those attractive tariffs to come back. All the remaining suppliers are bearing the costs of the smaller ones going bust to some extent.

If prices don't increase then you've potentially paid £56 extra for nothing other than peace of mind, if prices drop by more than £5 a month instead then you will probably cover your exit fees and be looking to switch early.

Having certainty in your costs might be more important than getting the cheapest deal so bear that in mind as well. The fact that you have "always" been on a fixed tariff with BG suggests you probably haven't always been on the cheapest tariff in the market either so just consider other suppliers although the big 6 seem a better choice if you don't want the hassle of your supplier going bust in the next few months..

**All the above assumes those monthly prices for last year / next year are done based on exact kWh annual usage and not your direct debit amounts which may not reflect actual usage.

So the quoted £127 is a 2 year fixed with BG, Using annual usage in kwh. (£50 exit fee per fuel)

Annual Gas is 8180 and elec is 3170 roughly.

So come Oct 1st with the new price cap, prices will rise and thats guarnteed? or not so? or no one knows?

You may be right, i probably havent been on the cheapest deal, i do keep an eye out from time to time, but dont switch for a few £ savings. (£30 exit fee per fuel)

It sounds like I would be best off going Fixed really and chancing my luck, dont think ill be switching company, as like you said i dont want the hassle of them going bust.

Do you know if its possible to switch tariffs within BG mid contract? as far as i can find on their website its not very clear. I'd assume your locked for 2 years and thats it?.

"How do I switch between tariffs if I’m already a customer?

It’s quick and easy to change tariffs online if you’re already with us. Simply access your account online, go to ‘tariff switch’ and pick your new tariff. It’ll take us 24 hours to switch you over and you won’t have to pay any exit fees."

I do really appreciate all the help and the time its taken you to write that all out, the way you've laid it out with all the calculations really helps, maths isnt a strong point and i cannot seem to picture it like you do.

Sorry for what i assume to most on here, are daft questions.

[Deleted User]

HouseHoldSavings said:

So come Oct 1st with the new price cap, prices will rise and thats guarnteed? or not so? or no one knows?

The only facts known are that the price cap has increased which therefore allows variable tariffs to increase above the current cap from the 1st of Oct up to the maximum of the new cap. However some variable tariffs are still less than the current cap and some might stay below the 1st Oct cap as well but the choice of variable tariffs seems to have reduced somewhat.

Fixed tariffs are not limited by the price cap and can be more or less and may or may not increase come the 1st Oct but at the moment most fixed tariffs are at around or above the cap.

Prices have already risen dramatically in the last couple of weeks, maybe that is as far as they will go for now, but really nobody actually knows if they have peaked or not.

One thing that is fairly certain is the battle between suppliers to win customers with cheap tariffs is on hold for now, all the big suppliers are gaining a million or more customers from the bust suppliers so no incentive to offer market leading rates. Some of the smaller suppliers seem to be struggling with costs and cutting back on referrals and marketing campaigns. Customers are being more cautious with their choice of supplier.

I know that doesn't really answer your question, I'd take the "no-one knows" option.

HouseHoldSavings said:

It sounds like I would be best off going Fixed really and chancing my luck, dont think ill be switching company, as like you said i dont want the hassle of them going bust.

Do you know if its possible to switch tariffs within BG mid contract? as far as i can find on their website its not very clear. I'd assume your locked for 2 years and thats it?.

Yes, it is possible to switch tariff mid-contract with BG with no penalty or exit fees even before the end of your 2 year deal as long as you are staying with BG.

I'm going to totally refrain from encouraging or advising whether you are best off fixing and when, all I'll say is that I've surfed the variable rates with various suppliers for the past 5 years yet I chose a fixed rate deal last month based on my 'guess' of what is happening in the near future but that deal I've got is well below the current price cap.

HouseHoldSavings

Its gone up £5 since yesterday now. FML. should have signed up last night.

HouseHoldSavings

So just to update, managed to get the £127 quote back.

I'm going to go fixed (for peace of mind) although I realise ill be paying more than the cap now. However with the view of changing mid contract if prices fall dramatically, which I guess they wont, but we can hope. Like you say they've gained soo many customers they aren't likely to be pushing amazing deals.

Appreciate all the help, I couldn't understand why my deals were more than the cap, this cleared it up. Makes sense now.

"Fixed tariffs are not limited by the price cap and can be more or less and may or may not increase come the 1st Oct but at the moment most fixed tariffs are at around or above the cap.". I didnt fully understand fixed could be above the price cap. I assume plenty people are happy paying a bit extra for price certainty.

Appreciate you can't tell me what to do, if I knew about the increasing prices i'd have signed up last month too!