Would you pay a premium over SVT for a 1 or 2 year fix?

artyboy

Really just following on from my last post, where I mentioned my cheap fix is coming to an end. These are my options with Sainsbury's Energy - SVT, fix for a year at a 5% premium (or even 2 years at an 8% premium).

Given the latest round of global instability and its short term effect on wholesale prices, I'm wondering if paying the 5% to fix is a smarter move. Crystal ball time I know... but what do you think?

mmmmikey

Being a cautious type, if I was on SVR I'd pay for the fix for a year. I'm actually on Agile which is way cheaper for me, so not a decision I need to make, but if it was that's the way I'd go. The risk of prices going up significantly is very real - the chances of them coming down significantly is much lower. So fixing easily wins for me, but I'd stick with a year because I wouldn't be surprised if prices start to stabilise beyond that.

p.s. great idea for a thread - be interesting to see where it leads and what folks are thinking right now

spot1034

Yes, I'd pay a 5% premium to fix for a year

You already pretty much know that it won't be a 5% premium come January, and the last forecast from Cornwall Insight for January is almost certainly now on the low side. You can also see the way Q2 prices in the wholesale market have increased, and if these persist until mid-February the price cap could even rise further in April given higher wholesale prices for a full assessment period (not the case now for the January price cap). Beyond that it's a complete guess, but on a 1 year fix you'll be coming towards the end by Q3 and could jump ship penalty free in the last 49 days which would be around the beginning of September. I think that's a good enough reason to fix and pay a little bit more for the next two and a half months.

Walter_Sobchak

Yes, I'd pay a 5% premium to fix for a year

I'm in a similar dilemma and have fixed for 1 year with OVO for a 7.82% increase.

Have 11 days remaining to change my mind.

Scot_39

Yes, I'd pay an 8% premium to fix for 2 years

A fix for 2 years at 8% isn't really adding much for inflation over the 5% for 1.  

Edit And even at 8% - is only taking you back to July rates for - or forecast Jan rates.

Think the last 2 year fix - ending in Feb 2023 my sister took out - had a 5% premium on SVT at the time - taken for certainty by sis at the end of previous fix in 2021 - not savings.  As it was - saved her a fortune last year - she came off during EPG - but her SC and rate both doubled - 32-64p and c17-34p /kWh

Upside risks seem to have the edge right now.

First Ukraine cut Western Europe's access to supplies - some remote or small supply risks - the Australian LPG strikes, the Slovak / Norway pipeline, although all small in terms of share of WE supplies - all created at least short term upwards spikes.

Two weeks ago - I would probably have voted 1 year.

Now worrryingly things are looking a lot less stable in middle east.

Past energy crisis in 1973/4 (OAPEC), 1979/80 (Iranian Revolution) and 1990 (Iraq/Kuwait war) - all reminders of how troubles in that part of the wider world - just as Ukraine has - can spread with economic consequences for West.

AbbieCadabra

Yes, I'd pay a 5% premium to fix for a year

i just started doing the calculations on ours yesterday, Switch With Which was showing a good 1 year fixed rate with So Energy which has already disappeared, but a 1 year fix 9% higher than current cap with our current supplier British Gas is looking attractive at the moment. Pay around £50 more in Nov & Dec, but price cap likely to rise in Jan to probably similar/higher rates than this fix, then I'm expecting rises perhaps for next 2 quarters, & hopefully start coming down again...

MikeJXE

Walter_Sobchak said:

I'm in a similar dilemma and have fixed for 1 year with OVO for a 7.82% increase.

Have 11 days remaining to change my mind.

After reading this thread I looked at my energy account 

I'm with Octopus since February and they have offered a 12m loyalty fix at the same rates of the variable I'm on now. Ok there are exit fees but I think it's a good deal considering whats going on in the Middle East, if not I'll suck it up 

I have signed up and have 14 days to change my mind

MultiFuelBurner

MikeJXE said:

Walter_Sobchak said:

I'm in a similar dilemma and have fixed for 1 year with OVO for a 7.82% increase.

Have 11 days remaining to change my mind.

After reading this thread I looked at my energy account 

I'm with Octopus since February and they have offered a 12m loyalty fix at the same rates of the variable I'm on now. Ok there are exit fees but I think it's a good deal considering whats going on in the Middle East, if not I'll suck it up 

I have signed up and have 14 days to change my mind

I can see a lot of people going for that for peace of mind 

Lorian

Yes, I'd pay a 5% premium to fix for a year

I've gone for a loyalty 1yr fix for short term peace of mind. Just over variable currently.

Netexporter

mmmmikey said:

Being a cautious type, if I was on SVR I'd pay for the fix for a year. I'm actually on Agile which is way cheaper for me, so not a decision I need to make, but if it was that's the way I'd go. The risk of prices going up significantly is very real - the chances of them coming down significantly is much lower. So fixing easily wins for me, but I'd stick with a year because I wouldn't be surprised if prices start to stabilise beyond that.

p.s. great idea for a thread - be interesting to see where it leads and what folks are thinking right now

Similar to my situation and thoughts on the matter.

I'm giving a lot of thought to bringing forward the installation of solar and batteries to insulate myself a bit from the general instability in the energy market.

QrizB

No, I'd roll the dice and go to SVT

I've voted to stay on the SVT.

In reality, as declared in my signature block, I'm on Octopus Go (which is a bit SVT-y) and Tracker (which is a higher risk option than the SVT).

Fortune favours the brave, and all that!