E.On Next Online v18 - should I fix like MSE suggests?

propertyhunter

Hello, 

Just bought a house and E.On Next are the energy supplier. They are quoting Next Flex (variable tariff) @ £150.06/pm and NextOnline (fixed tariff) @ £256.76/pm based on the energy usage over the past year of 718.2 kwh electricity and 18514.0 kwh gas. However, the house was unoccupied (but heating and some appliances were still on - supposedly). It's an old property with an old (inefficient) boiler and water tank.

Should I take MSE's advice and fix it? Here's the advice from MSE if you aren't aware of it: https://www.moneysavingexpert.com/utilities/-are-there-any-cheap--fixed-energy-deals-currently-worth-it--/

The difference between variable and fixed tariffs is 70%, and so the next rise in the price cap is baked into the fixed price. It's just prices after that. As it's a new home to us (2 people) we have no idea what the energy use will be in the first year (3 bed detached) as it will bear no resemblance to our previous home which was a new build very energy efficient flat. 

Your thoughts are appreciated.

Mstty

It is not a choice I would like to make but on the upside Eon Next tariffs have no exit fees.

The key date for most people is 26th August. This is the date Ofgem announce the October price cap.

Energy use wise the notional average for a 3 bedroom property with 2-3 people is 12000kwh gas and 2900kwh elec. Being an older property as you suggest you could use more than that unless you are frugal with your energy use. It's down to your comfort levels.

propertyhunter

I've never been on a fixed rate. So basically, they'll charge me if I go over the usage predictions - but the price of the energy per unit and standing charges are fixed for one year. So all I'm doing is hedging against the price increase in January since October's price is probably already accounted for in the fixed price. 

In terms of no exit fees - this means I can leave at any time within the year with no financial consequence - I just pay for what I've used? 

pochase

Yes, no exit fee means you can change to SVT with Eon or switch to a different supplier without having to pay a penalty.

There should be already a small saving against coming October:



You need to consider that your electricity usage will be much higher now that the house is no longer empty.

The usage for an empty house seems extremely high for me, especially for the gas. The gas usage would be even on the higher side if you live in the hose. Depends of course on things like insulation, how high the temperature is set etc.

What temperature and heating times were  set to get to 18000KWh in an empty home?

propertyhunter

Thanks for your calculation - that's really really helpful.

I have no idea re: the high gas usage. Perhaps the boiler was on all day. The previous owner was 90 when she moved out to a nursing home in June 2021, and it was empty since then - it's off now because of the summer temperatures and the back of the house is south facing. The executors (her daughters) must have kept the heating on because when we came to viewing it in January, the house was warm (even when trades went in to do surveys). The EPC is D (but that could be completely wrong). There's insulation in the loft and all windows are double glazed. I'm getting someone in before winter to fit draught excluders because I get the sense the house gets cold. 

victor2

propertyhunter said:

I've never been on a fixed rate. So basically, they'll charge me if I go over the usage predictions - but the price of the energy per unit and standing charges are fixed for one year. So all I'm doing is hedging against the price increase in January since October's price is probably already accounted for in the fixed price. 

In terms of no exit fees - this means I can leave at any time within the year with no financial consequence - I just pay for what I've used? 

It's as you say, the rate that is fixed, not the amount you pay. So you are right in that if you go over their predictions, you'll pay more. Similarly, if you use less, you'll pay less, or end up in credit.

I don't envy you - you have no idea what your energy usage will be, so can hardly plan for October's (never mind January's) increase to the cap.

A fix will guarantee your rates for the duration of the contract, how Ofgem will increase the cap every 3 months remains to be seen, but they are doing it to protect the suppliers, it does nothing for the consumers, except introduce further uncertainty.

Indeed, the lack of exit fees does mean you could switch away at any point at no extra cost to yourself. But finding suppliers who will take on new customers, particularly on their standard variable tariff, these days is not easy.

propertyhunter

I had no idea that energy suppliers are reluctant to take on new customers. I've been out of the market for a year and last had bulb as a supplier in June 2021. 

Unless anyone has a compelling reason not to, it seems like I should just fix on this occasion. In a new house when you have no clue what your expenses are going to be, it's better to have a fixed bill for 11 months and then accept that the final one could be a lot higher if your usage is higher than anticipated. 

spot1034

I'd say with Next Online v18 the gas is on the cheapish side relative to what the price cap is predicted to rise to, whilst the electricity might be a few pence over the cap. Not an easy decision, and it's a case of weighing up the pros and cons including the fact that you'll be paying more against the present SVT up to October, but that's not so long now and usage at this time of year isn't too high. However there are no exit fees, there is another rise in price likely in January, and on balance I'd probably go for it just to secure the cheaper gas for the winter which will almost certainly be the bigger of the two bills.  At the moment I'd say future prices for the winter are suggesting an even higher price for the January cap. 

victor2

propertyhunter said:

I had no idea that energy suppliers are reluctant to take on new customers. I've been out of the market for a year and last had bulb as a supplier in June 2021. 

Unless anyone has a compelling reason not to, it seems like I should just fix on this occasion. In a new house when you have no clue what your expenses are going to be, it's better to have a fixed bill for 11 months and then accept that the final one could be a lot higher if your usage is higher than anticipated. 

Eon Next will adjust your DD amount if they see you are not paying enough, so it won't be "fixed" for 11 months. You can adjust it yourself in your online account too if you wish, but currently only up to 10% below their prediction. Don't think there's a limit on how high you can make it though!

FreeBear

propertyhunter said: The EPC is D (but that could be completely wrong). There's insulation in the loft and all windows are double glazed. I'm getting someone in before winter to fit draught excluders because I get the sense the house gets cold.

Loft insulation and double glazed windows are only part of the solution in keeping a house warm. Get yourself a foam gun and a can of expanding foam. Go round the perimeter of each room and squirt a thin bead of foam into the gap between skirting and floorboards. Plug gaps between the floorboards with slivers of wood, rolled up newspaper, or even draught excluder foam. On the ground floor, put down a layer of wood fibre laminate underlay, and if you are using carpet, a decent quality foam underlay.

Check around the doors & windows for gaps - A badly fitted DG window will hurt your pocket as it will be a source of cold draughts.... Just had a few windows replaced here, and there was a good 25mm gap between the top of the frame & timber lintel on some of the windows. It was only the wood trim around the reveals keeping the worst of the weather out. These were timber & aluminium DG windows fitted in around 1976 - Should have stuck with the original single glazed....

If you haven't moved in yet, do consider insulation the external walls. Either EWI, or internal with something like insulated plasterboard - Done one room here so far (75mm Celotex on the inside), and it has made a huge difference in terms of keeping the room warm.

propertyhunter

Definitely agree regarding the foam gun and expanding foam. I'm onto that one. I didn't think about the floorboards or wood fibre underlay. The house is being renovated in 2 years, so everything will be changed then - we just need to survive the current crisis as best we can. Not sure whether I would get the wood fibre underlay if I'm going to rip it out in 2 years, but then I am replacing the carpets and foam underlay. Before doing that I will fill gaps in the floorboards. I'll use wool packing to fill random holes in walls where expanding foam is too much of a permanent solution (e.g. if I need to get access again, like behind the washing machine pipes). The window seals were a bit rubbish, as we had water ingress. That's been resolved. 

Any other tips from homeowners I'd be grateful (I know it's off topic - just PM me). Old home newbie here.