Should I start a new Octopus fixed rate deal or not?

What_time_is_it

Can’t decide whether it is worth signing up to a new Octopus 16 month fixed rate or not? I like their “no exit fees” policy and I’m also not averse to getting smart meters at some point too to access their other products. For now I want to stay on a “normal” price structure but retain the option to switch with no charge. So…

Usage
2,200 kwhs electricity
14,000 kwhs gas (almost all
on heating so loaded almost entirely in the 2 winter quarters with a little bit in April and sometimes early May)

Current fix ends 4th August 2025
SCs - 83p
E - 22.08p
G - 5.33p
No exit fees

Potential new 16m fix to June 2026
SCs - 84p
E - 24.1p
G - 6.19p
No exit fees

Current price cap (for context) is almost identical to the potential new fix.

What should so do?
Stick?
Or twist? And pay a bit more for my energy for the next 6 months in exchange for a cheaper winter next time?

TroubledTarts

With gas there is little choice but fixed imo at the moment with a view of perhaps returning to tracker when gas prices subside. Even with the new formulas that might work but always have your eye on a decent fix for winter where you use the most.

Electric is another story some are trialling tomato and getting good rates but no certainty if they will survive.

Electric prices are high at the moment on Agile and Tracker so it might be a case of fix there as well with no exit fees and then choose Agile or tracker for electricity. Apologies if this is too Octopus centric.

Mark_d

I'm happy with Octopus.  I would switch to another fixed deal if it was cheaper.  If you want to increase your bills then feel free to switch to a more expensive tariff.

If you think you can predict energy prices in August, and perhaps interest rates too, then you can become very rich and your energy bills would be insignificant to how much you could earn.

What_time_is_it

TroubledTarts said:

With gas there is little choice but fixed imo at the moment with a view of perhaps returning to tracker when gas prices subside. Even with the new formulas that might work but always have your eye on a decent fix for winter where you use the most.

Electric is another story some are trialling tomato and getting good rates but no certainty if they will survive.

Electric prices are high at the moment on Agile and Tracker so it might be a case of fix there as well with no exit fees and then choose Agile or tracker for electricity. Apologies if this is too Octopus centric.

Thanks. That’s really helpful. I do want to stay with Octopus as I find them very easy to deal with. At the moment I agree with the Agile and Tracker options - I’m not really sold on either at this present time. So it’s really a case of stick or twist with a fix rate for me.

double_dutchy

Psychologically, I think it's difficult to switch to a higher rate right now based on some possible future savings, but it might be the best bet if prices continue to rise. Only you can decide, really

I made that mistake in 2021, not signing up to a fixed rate which would have locked me in to eventual lower prices, and regretted it since.  When I signed up with Octopus Tracker in 2022 I initially paid more than SVR, only to recoup those "losses" and more over the next two years.

What_time_is_it

Thanks @double_dutchy
it would be a bit of a gamble, yes! And only the “losses” (I.e. paying the higher rates for Feb-July 25) would be guaranteed. 

On the other hand I think my losses wouldn’t be too great in a worst case scenario - maybe about £50 extra to pay, something like that. 

I am very tempted to roll the dice and re-fix at the higher rate in order to have a guaranteed “max” for next winter. Tricky…

vic_sf49

Ooh, that's not a clear cut decision is it. 

As you say, it's mostly increasing your costs for the rest of the current winter, vs a potentially better fix for the rest of the tariff length.

But if you did re-fix now, you can check monthly, to see if any new tariffs beat the new fix, and hop from one to the other.....assuming there are any better rates this year.

QrizB

I'm sticking with my gas Tracker for now, vs. ~6.4p/kWh on Flexible or the Feb25 v1 16m fix. I'll take another look if it goes above 7p/kWh for a significant period.

My logic is, I'm expecting to use about 1000kWh/month for the next couple of months, then tail off. Paying an extra 0.6p/kWh is £6 a month; I'm happy to risk that in the hope that day-ahead prices fall.

EssexHebridean

I see your dilemma. The issue is of course that predicting the prices this far out is tricky, although I have to say I’m with you on assuming that they are likely to be higher in August than currently. If your fix was due to end in April or even May it would be a no brainer - with that run-in though it’s a lot trickier. 

If I were in your shoes? Hmmm…honestly, I think I’d be inclined to work on the basis that keeping the cheaper prices for now would be better, allowing for the chances of further cold snaps this winter. Then I’d keep a close eye on fix prices from the point where the heating goes off - or at least right down - with a view to fixing at some stage between then and august. 

RavingMad

There is a ring of truth in his words, though. We can't predict which way energy prices will go this year but as Cornwall are predicting a rise in April we can say that subsequent Fixes will be more not less