Fixed rate or not

aclarkie4

My energy supplier Octopus are offering me two options as my contract is coming to an end. At the moment I pay £95 a month. They are offering

* £161 fixed 12 month contract or

* Do nothing and pay £113 which can go up or down

Don't know what to do
Any advice ?

MWT

Best advice we have at the moment is do nothing and you will be put on the standard, capped, variable rate.

Then check again early next year and see what the fixes are looking like then.

Astria

Your figures mean nothing.

What are you paying at the moment per kWh for gas and electric?

What will you be paying on a fixed contract?

What will you be paying on a variable contract?

How much energy do you expect to use between now and April? How much energy do you expect to use over the next 12 months? Compare them all, go for the cheapest. Estimate at least 12% increase next April.

aclarkie4

At the moment I pay electric 18.78 per kw and gas 2.78
Do nothing they offer electric 21.76 and gas 8.94
Fixed they offer electric 31.32 gas 8.36
Not sure how much I estimate to use same as last year I suppose ATM I'm in credit by £312
Sorry I'm not very good at maths

Ant555

aclarkie4 said:

At the moment I pay electric 18.78 per kw and gas 2.78
Do nothing they offer electric 21.76 and gas 8.94
Fixed they offer electric 31.32 gas 8.36
Not sure how much I estimate to use same as last year I suppose ATM I'm in credit by £312
Sorry I'm not very good at maths

I do not profess to be an expert but my reading of the energy situation is that the cap will be going up in April, possibly to just under the level you have been offered as a fix, then the cap will most likely go up again 6 months after this (happy to be corrected).
Depending on your usage, you will have a couple of months at a higher rate BUT you are protected from then on for x months (12/24?)

I assume that fixed rates will be climbing all the time and many rates available today will continue to get more expensive during 2022  -  Its this bit that the experts seem to be hoping will change but I am unsure if rates will go down at all.

As a very cautious person, I would at least consider a fix rate - my opinion but based on what I see happening in in the world.

Of course Putin and Biden might get together over Christmas and agree that Ukraine wont join NATO and/or discuss the pipeline situation whilst knocking back a few vodkas, become best buddies and things such as the wholesale energy prices might start to return to far lower levels.

pearl123

At the moment, I believe Martin lewis has said don't fix. I find it difficult to take that on board, when I see alarming news about energy prices rising. I'm tempted to do a 2 year fix, but the price jump is huge. 

QrizB

aclarkie4 said:

At the moment I pay electric 18.78 per kw and gas 2.78
Do nothing they offer electric 21.76 and gas 8.94
Fixed they offer electric 31.32 gas 8.36
Not sure how much I estimate to use same as last year I suppose ATM I'm in credit by £312
Sorry I'm not very good at maths

Octopus's "do nothing" rate for gas is not 8.94p/kWh. It could be 3.94p, have you mis-typed?

bristolleedsfan

aclarkie4 said:

Fixed they offer electric 31.32 gas 8.36

Sorry I'm not very good at maths

Looking at South West as an example  electric rate you quote appears to be day rate E7

Loyal Octopus 12M Fixed December 2021 v3

Eco 7 Electricity

Day unit rate: 31.84 p/kWh

Night unit rate: 19.41 p/kWh

Standing charge: 25.75 p/day

Electricity

Unit rate: 27.92 p/kWh

Standing charge: 25.66 p/day

Gas

Unit rate: 8.49 p/kWh

Standing charge: 26.1 p/day

Ant555

pearl123 said:

At the moment, I believe Martin lewis has said don't fix. I find it difficult to take that on board, when I see alarming news about energy prices rising. I'm tempted to do a 2 year fix, but the price jump is huge. 

Or, stick to the SVR but I suspect a good option, for those that can afford it, is put away the money between that and the fix in a separate place - if pricing goes up massively next October then you have gained in the interim period but have a buffer to dip into for next winters increased pricing.  If prices stabilise or even go down (yeah right) then you have also won as you still have that  reserve to pay some bills.

Come 2023 then we may all be burning our wooden furniture to keep warm - so just try to make the best of it until then

SuperHung

aclarkie4 said:

At the moment I pay electric 18.78 per kw and gas 2.78

what? how? seriously?! My heating would be on 24/7 during winter if its 2.78p per kw

Ant555

SuperHung said:

aclarkie4 said:

At the moment I pay electric 18.78 per kw and gas 2.78

what? how? seriously?! My heating would be on 24/7 during winter if its 2.78p per kw

I suspect a 1 or 2 year fix ending about now could quite easily have been that rate.

I took out a 2 year fix in May 21 that is not much more than that