Ovo launches one-year fixed tariff – but is it worth switching to?

MSE_Clare

We'd love to know your thoughts on Ovo's 1 year fixed deal for existing customers. Read our news story for more details.

Mstty

I have calculated the prices for my area and if I wanted certainty for a year it would definitely do that.

As a single fuel user (electricity) the cost of getting out of the fix would only be one payment of £75.

The caveat is prices are predicted to fall a few pence per kWh for electricity under this fix from 1st July til 31st December so combined with the exit fee(s) and overwhelming (several well known sources) saying energy prices will drop substantially for 6 months from 1st July I would suggest that most will stand firm and wait for some price cap beating deals come 1st July.

ariarnia

we also looked at the prices we were offered and have decided not to go for it. 

we're duel fuel so £150 exit fee and the prices are literally pennies less than what we'll be paying from 1 april so we're going to bank on the forecasts being right and over the 12 months saving more staying on variable or waiting for a better fix. 

MuckChucker

Quick query. So with prices rising, they hit the cap and thus were only going up when the cap was reviewed every 3 months. When prices are going down, does this just happen ad hoc i.e. much more frequently?

I'm guessing many would be like me and have probably never been on a variable plan before all this fun started.

Swipe

I'd rather take the gamble

pochase

MuckChucker said:

Quick query. So with prices rising, they hit the cap and thus were only going up when the cap was reviewed every 3 months. When prices are going down, does this just happen ad hoc i.e. much more frequently?

I'm guessing many would be like me and have probably never been on a variable plan before all this fun started.

The cap changes eevry 3 months, up or down.

ariarnia

MuckChucker said:

Quick query. So with prices rising, they hit the cap and thus were only going up when the cap was reviewed every 3 months. When prices are going down, does this just happen ad hoc i.e. much more frequently?

I'm guessing many would be like me and have probably never been on a variable plan before all this fun started.

for now, the variable rate will probably stay at the goverment guarentee price until at least june (as the market price has to come under the 2500 before we can see any change). 

after june when the guarentee wont factor into things your supplier has to give you 'reasonable' (normally 30 days) notice when changing your prices (tho still has to be under the ofgem cap). 

we've normally been on a fix (like most people) but i've gotten the impression that rates might change once or twice a quater depending on the seasonal price of energy? any big changes means they'll notify you of change of rates but small ups and downs will just average out. 

(unless your on one of the tarrifs like with octopus where your rate changes every day.)

tho i'm not sure how it will work coming back of the guarentee. could bet hat we see prices on the variable tracking closely with the ofgem cap for a while and suppliers not putting prices on the variable down unless ofgem make them. 

silvercar

This has been discussed here: https://forums.moneysavingexpert.com/discussion/6434932/ovo-now-offering-a-fixed-tariff-for-one-year#latest

Marvel1

With the exit fees, I'm wondering if they are certain the prices will drop so locking you in.

Scot_39

The gamble on duel fuel looks finely balanced based on say CI forecasts.

Roughly -250 Apr, +250 Jul and Oct vs CI 

And did see one forecast Jan 24 also c2100 again more

But many people might need to stop thinking about the new/recent old way - that fixes were a way of saving now.

And remember the old old way where fixes were often initially at a premium to guarantee security / stability of known future bills.

The rush to the bottom happened, and although fixed rates not the only reason, we have 30+ fewer suppliers, some small, some very large, who failed -  to choose from.

Many of whom arguably gambled and lost on wholesale pricing stability.

But as the EPG remains at £3000 - the upside risk is also capped to Apr 1 2024 for all.

I cannot fix or move - as legacy E10.

My guess - many will wait.

And this in part a marketing move - certainly got Ovo a lot of press coverage.

Scot_39

MuckChucker said:

Quick query. So with prices rising, they hit the cap and thus were only going up when the cap was reviewed every 3 months. When prices are going down, does this just happen ad hoc i.e. much more frequently?

I'm guessing many would be like me and have probably never been on a variable plan before all this fun started.

Svt tariffs are capped by epg right now - the notional £2500 - by discounts to the actual cap, but widely predicted to revert to Ofgem cap in July.

The Ofgem actual cap, is now reviewed every 3 months not 6.

So more reactive in both directions.

Saves risk of driving energy suppliers to wall on way up.

Means consumers see the rises sooner, but faster on way down too.