Given the recent price increases, I think it’s safe to say we are all more than a little concerned about how much it’s going to affect our household bills. One of the options available at the moment is to fix your gas and electric prices for a period of time, usually called a fixed price tariff.
The big bonus of having fixed gas and electricity prices is that it can offer you peace of mind that the cost of your energy bills will not go up, regardless of what is happening in the market. Now depending on the tariff, you could be paying a fixed rate for anything between a year and 3 years.
However, even though fixed price energy could be extremely beneficial in the current climate, in exchange for the security of having a set price you can often end up paying a bit more than some of the standard/online tariffs. The fixed rate options can also come with rather high early termination clauses so be careful when selecting the length of your tariff as it may be expensive to try and move before the contract is up.
For these reasons it can be a bit of a gamble switching over to fixed price because if like just now prices are on the rise then you could make some serious savings, however if they drop before your minimum term is up chances are you’ll end up paying a bit more than necessary.
Assuming you have taken out a fixed price energy deal, inevitably the question of what do to do when it ends pops up. Now the most important thing you can do is find out which plan you will roll onto. It might just be a standard plan, you may be re-contracted or they could give you the chance to fix your prices again. Bear in mind that you may end up paying over-the-odds for the fixed price security.
Hopefully this has given some insight into fixed gas and electric tariffs, and will help your decision making that little bit easier. Please feel free to let us know about any experiences you’ve had with a fixed tariff, we’d love to hear it.
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