April 2025 price cap

CaptainWales

Let's assume that the price cap rises 10% in October and then stays the same in January 2025. Is there a way to work out how much it would then have to fall in April 2025 to make a fixed deal now worthwhile? 

mebu60

If your provider has no exit fees then it's academic, take the fix.

The answer to your question is 9% I believe.

I wouldn't bank on there being no rise for January 2025 personally. 

CaptainWales

Thanks mebu60.

Do you foresee an increased price cap in January? 

RelievedSheff

CaptainWales said:

Let's assume that the price cap rises 10% in October and then stays the same in January 2025. Is there a way to work out how much it would then have to fall in April 2025 to make a fixed deal now worthwhile? 

Crystal ball?

CaptainWales

Not sure why i would need a crystal ball. Would it not be the 9% mentioned previously?

On-the-coast

But your question is unanswerable without telling us what your offered fixed deal (for now) is (in relation to the current price cap), and even then, depending on market sentiment, fixed deals in April might deviate from the then announced price cap more or less than is current - so it's reasonably pointless.    About 9% (or 10%) is close enought for guestimating.
Fix if you want certainty.
Fix on a Zero Exit Fee contract if you want a combination of flexibility and certainty.

BarelySentientAI

CaptainWales said:

Let's assume that the price cap rises 10% in October and then stays the same in January 2025. Is there a way to work out how much it would then have to fall in April 2025 to make a fixed deal now worthwhile? 

Depends entirely on what the fixed deal is and how your usage varies over time.

Scot_39

The mse to fix or not guide was iirc saying anything less than 8% - now saying 9% over July cap was likely to be a winner over 12m.

And tables quite a few upto and just over that threshold.

https://www.moneysavingexpert.com/utilities/are-there-any-cheap-fixed-energy-deals-currently-worth-it/

So the answer to your question - is not obvious in any case a valid one - as you also would potentially be in a fix for the 1st month of July cap period too.

And obviously depends on what fix you use as the basis.

And as above if worried about getting tied in - go for low or no exit fees.

And don't forget to grab any referral bonuses - for you and friend / relative / colleague etc - if switch to fix and save another £50-60.

spot1034

EDF's prediction for forthcoming price caps https://www.edfenergy.com/gas-and-electricity/price-cap-predictions

And British Gas (scroll down a bit) https://www.britishgas.co.uk/energy/price-cap.html

Neither are forecasting a fall. Of-course they may both be wrong - what has tended to happen recently is that nearer term prices are lower than the longer term, but that has been in a mostly falling market which is no longer what we have, and I'd suggest the political climate is more unstable and the longer we have avoided a cold winter in the northern hemisphere, statistically the more likely we are to get one. If we and the rest of Europe have depleted our stocks during Q4 and Q1 due to cold weather, there will be a mad scramble to refill them in Q2 and prices will reflect that. 

The three offers of fixes at around the present price cap from major suppliers (British Gas, EDF and Octopus) have all been pulled since yesterday morning.  (MSE haven't caught up with the Octopus one yet, but it's gone) 

mebu60

CaptainWales said:

Thanks mebu60.

Do you foresee an increased price cap in January? 

Be very surprised if it doesn't. 

badmemory

Don't forget the increases in the standing charges too.  So up in Oct & Jan, down a little in Apr & July & rinse & repeat.  This is likely to be the way it goes for years as no-one (especially ofgem) seems to have the will to do anything about it.  It really is time the industry had oversight by a quango that isn't financed by that industry & therefore whose interests are that of the industry & not us mugs who have no choice but to use that service.