British Gas Fixed Tariff question

SmithyST170

Good evening,

My parents energy supplier is British Gas (Gas and Electric). After today's announcement they are looking to fix but want to stay with BG. 

There is the Fixed Tariff v33 for Electricity which is an estimated £50.55 a year saving on a 16 month fix which isn't bad is it?

When it comes to Gas there is the Fixed Tariff v33 16 month fix but this is an estimated extra spend of £7.84 a year.  

Could you advise what to do please?

Neil_Jones

The clue is "estimated".  if more energy gets used your bill will go up anyway.

If the prices do drop for July and raise again for October and next January it balances back out again by the end of the year so nothing really changes.

Its all about fixing your unit cost so that doesn't go any higher than it needs to; ideally the best time to do this was prior to the previous price cap adjustment, but that's the risk you take.

If the unit rates are lower than the price caup figures for your region as documented here, then it may be a no brainer.  Otherwise consult a comparison site.

https://www.moneysavingexpert.com/utilities/what-are-the-price-cap-unit-rates-

SmithyST170

Neil_Jones said:

The clue is "estimated".  if more energy gets used your bill will go up anyues

way.

If the prices do drop for July and raise again for October and next January it balances back out again by the end of the year so nothing really changes.

Its all about fixing your unit cost so that doesn't go any higher than it needs to; ideally the best time to do this was prior to the previous price cap adjustment, but that's the risk you take.

If the unit rates are lower than the price caup figures for your region as documented here, then it may be a no brainer.  Otherwise consult a comparison site.

https://www.moneysavingexpert.com/utilities/what-are-the-price-cap-unit-rates-

Thank-you for your reply. Yes the unit rate is lower for the electricity on the fix. 

Regarding the gas, at the moment the unit price is 6.19p per kWh. The fix price is 6.31p per kWh but from April it will be around 6.58p per kWh with the 6.4% increase.

Would you fix now or wait to see if they offer something better?

Neil_Jones

Remember your standing charges as well is what I should have added.

As the prices have gone up since the last cap, you've missed the boat on the better options.  If the predictions are correct and it comes down in July by 2% then in theory you're only going to drop to mostly likely 6.4p per kWh on the gas only to come back up to the 6.58p unit later in the year all other things being equal.  World events may dictate the price falls through the floor, it may dictate it it goes through the roof.

However you will use the least energy in July through to September and hardly any gas outside of the oven (if applicable) and the hot water so the predicted drop is pretty much irrelevant.

If you want the certainly for 16 months, take the fix.  If you want to take the risk and hope things go swimmingly well and see if the cap falls after the end of the year, leave it be.  If events push prices up again, you'll be quids in on the fix.