Switching newbie

ellymoo

Actually I'm not - I was a regular switcher until July 2021 when I was lucky enough to get on a fixed rate with Scottish Power which has now expired, and in the ensuing time period switching has changed beyond recognition so I don't have a clue what I'm doing now.

I'm now looking around at the tariffs available. SP are only offering a tariff which 'could go up or down'. If I understand correctly, the unit rate for the energy would stay the same, but the sodding standing charges could go up.

I'm aware that the price cap may drop in October but may go up again. With that in mind I'm wondering if I should go with Octopus who offer a 'flexible' rate BUT there are no exit fees. SP charge exit fees of £100 per fuel (I have both electricity and gas). Then if things do go up/down substantially I would be able to change to another supplier or another Octopus tariff; but looking at the tariff it looks like just a 'standard variable rate' which would mean that the amount I pay could go up or down like a yoyo at any time.

While the cost is important, probably knowing what my payments would be for the next year at least is more important as I really don't have much wriggle room.

Any advice or guidance about what I'm missing would be gratefully received. I'll also be looking for my neighbour who is electricity only currently on a standard tariff as I look after his account. We are both 'low' users.

Many thanks!

vic_sf49

SP will have a Standard Variable Rate tariff, which will be similar to Octopus' Flexible (also a SVR) tariff, but I've no clue what they're calling it. The SVR doesn't usually have exit fees. 

So I'm not sure which tariff SP are offering that can go up and down, yet still has exit fees.

I, and many on here find Octopus really good, so that may be a good move. Ask friends or family on Octopus, for their referral code (you both get £50).

Octopus' SVR was slightly cheaper than British Gas were, when I switched last year.

I have no clue who is offering a fix, or how competitive the rates may be, but if you want certainty over what your unit rates may be, then look for fixed tariffs. Some might only be available to existing customers.

Scot_39

OP I suspect referring to their fix - well fixed term anyway - offer.

There's some posts in threads on it here -  it's called Flexi.

https://www.scottishpower.co.uk/flexi

It's a fixed term contract with what in a business supply would be termed pass through costs.

And as OP says - they essentially only guarantee the wholesale energy price components, but can pass on Ofgem / govt policy changes.

Like for instance when Ofgem near doubled the electric Standing Charge.

Many coming off 2 year fixes were paying tge old c25-30p style levels - there suppliers were paying the new c55-60p levels in many regions regardless.  My sis electric SC with SP was up c31p in Mar at end of 2 yr fix- £110 a year

Thats a non trivial loss on a 1.9% ebit margin allowance - which even at max Ofgem cap Jan - c£81 - and at current July cap £2074 - a much lower £39.40.

Ofgem failure to properly regulate suppliers and tinkering has had and will continue to have costs for many of us.

It is hardly  surprising given those sort of variations a supplier would seek to protect itself.

In fact you could argue it is potentially even unwise from a business point of view of others not to on a fixed term deal - and given 30 odd collapses - Ofgem to allow them too.

ellymoo

Yes, that sounds right. So basically the standing charge would go up and down but the energy rate would stay the same on both SP and Octopus?

In which case I'm tempted to go for the one which would cost least if I need to switch.

rp1974

There's no way to guarantee your payments for the next year,which will depend on your useage.
You can of course fix the standing charge and unit rates,bearing in mind applicable exit fees should you choose.
Using the last 12 months consumption which will be on your bills,will provide an approximation of what the ballpark payment should be.

Spoonie_Turtle

ellymoo said:

Yes, that sounds right. So basically the standing charge would go up and down but the energy rate would stay the same on both SP and Octopus?

No.  Both unit rate and standing charge can change on the standard variable (whatever supplier) but whether they will or not depends on what Ofgem decides about the price cap.

Standard variable should not have any exit fees regardless of supplier.

The SP "flexi" with fees also won't necessarily fix the unit rates.  If you look at the tables on their website for what costs can change, some are on the standing charge and some are on the unit rate.  The only thing that is fixed is the wholesale cost which makes up part of the unit rate, not all.

The Standard Variable tariffs (including Octopus' Flexible, just to be confusing) can change every three months so far, the same frequency that SP's fixed term Flexi can change.


If you need certainty you need a fully fixed tariff, which is not what SP are offering with the Flexi.

ellymoo

Thank you very much. We have both gone to Octopus, and Octopus are now offering us to fix for a year which I think we will do.