Am I being offered a decentish deal here?

wamphyri

Apologies for what is probably the n00th question about fixing or going onto the capped rate but looking through some of the posts in the forum and predictions I am wondering if my fix deal being offered by Scottish Power isn't too bad.

In another thread QrizB posted: " Right at the moment the deemed tariff is around 21p/kWh for electricity, 4p/kWh for gas and 25p/day standing charge for each. This won't change until April (when it's expected to rise significantly).The "Fix Long-Term" is probably more like 40p/kWh for electricity and 10p/kWh for gas."

I have been offered a fix with 24.28p Elec (29.86p for 2 year fix) and 6.25p (6.86p for 2 years) for gas which seems to be well below QrizB's prediction for a long term fix and not too far off the deemed tarriff (which I assume is what I would go on in Feb if I do not fix?). Given the piece on BBC news today about the possibility of a 50% rise in 2022 am I right in thinking that this fix I am being offered may be worth considering?

QrizB

I was hoping someone else would reply but I guess they have better things to do this afternoon

Are you on a current fix that ends in February? And your current fix is cheaper than the capped rates I mentioned?

If so, you've got an interesting dilemma. If you take the fix (which isn't awful; can you confirm the end dates on offer?) you'll be paying more than you need to for the remaining months of this winter but, possibly, less from April to October.

How long is this offer valid for? If you accept, you want to switch as late as you can.

What I'd do in your position is look at last year's bills and see how much energy you're likely to use between now and the end of your current fix (at your current fixed rates) , and how much from then to the end of March (at the curent cap). You can then work out how much worse off the offered fix will make you by, and decide for yourself whether that cost is worth it to fix your rates after April below the expected cap.

wamphyri

Cheers, my current deal ends on 31st Jan & there is no expiry date on the offer which has been the same since I started getting emails over a month ago so have not really been panicing as I am assuming they will remain the same up until the end of Jan - though if I do notice a change it will prompt me to take a decision.

I am currently paying 16.18p and 3.01p. 17p standing (fix rises to 21p) so quite a bit cheaper than the capped rates.

The end dates I assume will be 31st Jan 2023 or 2024 depending whether I take the 1 or 2 year (also the 2 year has no exit charge while the 1 year deal has £60 exit charge so one option would be to take the 2 year and bail if prices significantly drop at some point). I am prob considered a high user with a current monthly of £266 - rising to £377 on the new fix so it's not going to break me but we all like to save if we can.

savers_united

Whatever you do is a gamble as no one can 100% predict where prices will be over the next year let alone the next 2 years.

Things could get alot worse from here but could also quite quickly correct back to long term norms.

What we do know is that we are going to see some significant increases to the cap in April. A personal view is that it will not be allowed to go much higher, not sure how it looks but some form of Gov't intervention would be expected otherwise by next winter we could be heading towards average bills in the mid to high £2k, an almost trebeling of prices in less than 2 years that would cripple many households, so I just don't think that Elec @ 40p and Gas @ 10p will be seen, especially with EVs being seen as the future of carbon reduction and a ban on petrol / diesel sales in 8 years. 

Gerry1

What are the exit fees?  Some are now becoming ridiculous.

wamphyri

Gerry1 said:

What are the exit fees?  Some are now becoming ridiculous.

£60 for the 1 year fix, no exit fee on the 2 year fix.

Gerry1

Per fuel??

wamphyri

Gerry1 said:

Per fuel??

No per 'deal'

bristolleedsfan

wamphyri said:

so one option would be to take the 2 year and bail if prices significantly drop at some point). I am prob considered a high user with a current monthly of £266 - rising to £377 on the new fix so it's not going to break me but we all like to save if we can.

If choose 2 year fix with no exit fees after you have used approx more than 1100kwh in E you will be paying more than total £60 exit fee compared with 1 year fixed E kwh rate

Flight3287462

That sounds cheap.  Come April bills are going to rocket.