Martin Lewis: Energy price cap to rise by 51% on 1 April - should you fix now?

QrizB

JuMoon said:

Two questions - the one year fixed rate has £60 exit fees, but I can do a two year fix with no exit fees. Is this situation likely to go on for 2 years? Best to fix for 1 or 2 years?

If the rates are identical, a 2-year fix with no exit feews is better than a one-year fix with exit fees. You can quite the two-year fix at any time.

Froglet99

I am with Octopus after moving from Avro in Feb 2021.
My fixed price cost after the transfer is £89 per month, but after efforts to reduce consumptions I will have a balance of about £120 at end of contract.
That makes my current contract equivalent to about £79 per month.
Octopus contacted me by email recently, about supply options after end of contract
They were upfront, like Virgin Media used to be.
One option is to "do nothing" and go with the price cap.
Another option was a fixed price contract for the next year, estimated (by them) as £333 per month.
THAT'S ABOUT 400% higher!!!

Is there an element of "money recovery" here?
i.e. they absorbed the customers from AVRO and now have to find out how to recoup their costs in doing that.
Why did these dud energy companies take on the customers from failed companies, which now they expect me and the rest of us to pay for?

It's a shambles, and even now the "green" pressure groups argue against exploring new supplies.

spot1034

Froglet99 said:

I am with Octopus after moving from Avro in Feb 2021.
My fixed price cost after the transfer is £89 per month, but after efforts to reduce consumptions I will have a balance of about £120 at end of contract.
That makes my current contract equivalent to about £79 per month.
Octopus contacted me by email recently, about supply options after end of contract
They were upfront, like Virgin Media used to be.
One option is to "do nothing" and go with the price cap.
Another option was a fixed price contract for the next year, estimated (by them) as £333 per month.
THAT'S ABOUT 400% higher!!!

Is there an element of "money recovery" here?
i.e. they absorbed the customers from AVRO and now have to find out how to recoup their costs in doing that.
Why did these dud energy companies take on the customers from failed companies, which now they expect me and the rest of us to pay for?

It's a shambles, and even now the "green" pressure groups argue against exploring new supplies.

Suppliers of last resort are able to reclaim the cost of taking on customers of failed suppliers, including any cost of buying additional energy in the market which they cannot recover from the customer. In the case of Avro I believe this is likely to be a huge sum, which will be added to the bills of everybody (with all suppliers) in due course.

It is simply the case that the cost of energy at present is several times what it was a year ago, and the new fixed rate Octopus have offered you reflects this.

They don't expect you to accept the offer, and it is quite likely that prices in the market will fall at some point, at which point some more attractive offers will become available. Just don't ask when, as no one knows.

QrizB

Froglet99 said:

I am with Octopus after moving from Avro in Feb 2021.

You fixed in February 2021. I guess your tariff for gas was around 3p/kWh and electricity around 15p/kWh? Those days are long gone.

Octopus most probably offered you three options: variable, loyalty fix or regular fix. The variable will be cheaper for the next two months but the loyalty fix could be cheaper overall.

The choice, as they say, is yours.

Fred2712

Froglet99 said:

I am with Octopus after moving from Avro in Feb 2021.
My fixed price cost after the transfer is £89 per month, but after efforts to reduce consumptions I will have a balance of about £120 at end of contract.
That makes my current contract equivalent to about £79 per month.
Octopus contacted me by email recently, about supply options after end of contract
They were upfront, like Virgin Media used to be.
One option is to "do nothing" and go with the price cap.
Another option was a fixed price contract for the next year, estimated (by them) as £333 per month.
THAT'S ABOUT 400% higher!!!

Is there an element of "money recovery" here?
i.e. they absorbed the customers from AVRO and now have to find out how to recoup their costs in doing that.
Why did these dud energy companies take on the customers from failed companies, which now they expect me and the rest of us to pay for?

It's a shambles, and even now the "green" pressure groups argue against exploring new supplies.

I would check what consumption the quote is based upon, it could be based on incorrect consumption figures.

RFB_2

I'm on Octopus (supposedly one of the few with reasonable caps for existing customers) and they are currently quoting me £2387 to fix on their Loyal Octopus 12M Fix rate compared to my current Flexible Avro cost of £1479 an increase of 61%, . a standard 12M fix is quoted at £2945 which is double the current cost.

So for now I won't be fixing

MWT

RFB_2 said:

... and they are currently quoting me £2387 to fix on their Loyal Octopus 12M Fix rate compared to my current Flexible Avro cost of £1479 an increase of 61%, . a standard 12M fix is quoted at £2945 which is double the current cost.

So for now I won't be fixing

The unknown at this moment is what the flexible tariff you are on will increase to in April, and when we do get to April, what the fixed tariffs available then will be...

DiseasedBunny

MWT said:

RFB_2 said:

... and they are currently quoting me £2387 to fix on their Loyal Octopus 12M Fix rate compared to my current Flexible Avro cost of £1479 an increase of 61%, . a standard 12M fix is quoted at £2945 which is double the current cost.

So for now I won't be fixing

The unknown at this moment is what the flexible tariff you are on will increase to in April, and when we do get to April, what the fixed tariffs available then will be...

Exactly this.  I can get scottishpower for 2 years and will be £40 a year more than the 40% cap increase, so any more than 40 and I’m quids in - and it’s saved on my pc as the minute any aid is announced by the government and or the April figures are released if it’s better to fix for the 2 years I’m clicking on it straight away! 

DiseasedBunny

MWT said:

RFB_2 said:

... and they are currently quoting me £2387 to fix on their Loyal Octopus 12M Fix rate compared to my current Flexible Avro cost of £1479 an increase of 61%, . a standard 12M fix is quoted at £2945 which is double the current cost.

So for now I won't be fixing

The unknown at this moment is what the flexible tariff you are on will increase to in April, and when we do get to April, what the fixed tariffs available then will be...

Exactly this.  I can get scottishpower for 2 years and will be £40 a year more than the 40% cap increase, so any more than 40 and I’m quids in - and it’s saved on my pc as the minute any aid is announced by the government and or the April figures are released if it’s better to fix for the 2 years I’m clicking on it straight away! 

bristolleedsfan

MWT said:

RFB_2 said:

... and they are currently quoting me £2387 to fix on their Loyal Octopus 12M Fix rate compared to my current Flexible Avro cost of £1479 an increase of 61%, . a standard 12M fix is quoted at £2945 which is double the current cost.

So for now I won't be fixing

The unknown at this moment is what the flexible tariff you are on will increase to in April, and when we do get to April, what the fixed tariffs available then will be...

MWT said:

RFB_2 said:

... and they are currently quoting me £2387 to fix on their Loyal Octopus 12M Fix rate compared to my current Flexible Avro cost of £1479 an increase of 61%, . a standard 12M fix is quoted at £2945 which is double the current cost.

So for now I won't be fixing

The unknown at this moment is what the flexible tariff you are on will increase to in April, and when we do get to April, what the fixed tariffs available then will be...

What is known is if someone switches now to a fixed rate  from flexible Octopus they will be paying extra 109%ish more for gas usage for about 3 months being as Octopus tend to increase flexible Octopus rates a little later than energy cap increase date.

From the middle April until 1 October or later many people user relatively little gas, after middle of October there would be only 3 months to the end of fixed rate period