Martin Lewis issues energy supplier warning as fixed deals return – should you switch?
MARTIN Lewis has issued an energy bill warning to households as suppliers bring back fixed deals.
The founder of MoneySavingExpert (MSE) has written to the energy regulator Ofgem to ask it to force suppliers to publish details of every tariff they offer.
Martin said this would help households to understand if a fixed deal is worth switching to.
At the moment, suppliers don't need to publish tariffs for existing customers, making it hard for households to know whether to switch or not.
It comes as several major suppliers, including British Gas, So Energy, E.on and Ovo, start bringing back existing customer-only fixed deals.
In the letter, Martin writes: " As these deals aren’t listed on comparison sites because the information isn’t available, when consumers who get them then come to the end of their tariffs, they won’t be able to do a comparison – even if open-market deals have returned by then – as there won’t be data on the tariff they are on."
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Last month, the energy regulator announced that typical gas and electricity bills will be capped at £2,074 a year from July 1.
This will take effect when the government's Energy Price Guarantee, which limits the typical domestic energy bill to £2,500, expires in a month's time.
The fall in Ofgem's price cap will reward households battling the cost of living with a £426 annual saving.
Fixed energy tariffs give customers bill stability over a set period.
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By locking into a deal you can avoid bill hikes during its set period.
But you could end up being stuck paying more if prices fall in future so it's important to assess the real value of these offers.
If you're coming off a fixed energy tariff and don't renew, you'll automatically fall onto your supplier's standard variable tariff (SVT).
And from July 1, Ofgem will introduce the following new rates for those on the SVT:
- 8p per kilowatt hour (p/kWh) for gas
- 30p/kWh for electricity
- A standing charge of 29p per day for gas
- A standing charge of 53p per day for electricity
For a typical household that uses an average of 12,000kWh of gas and 2,900kWh of electricity every year, these rates will cap bills at roughly £2,074.
But this is only an estimate for a typical household - so if you use more energy you'll pay more.
Any fixed deal that's under the typical rate for those on the SVT could be worth locking into, Martin Lewis previously said.
However, before agreeing to a new fix it's important to understand that Ofgem's energy price cap will be reviewed again later this year.
The regulator used to set the price cap every six months. But since August last year, it now reviews the cap on unit rates for those on the default tariff every three months.
This means that annual energy bills may drop further into 2023 when the next price cap comes into force in October.
Energy experts at Cornwall Insight expect typical bills to fall again to £1,959.58 a year from October but they could then rise again to £2,026 a year from January 2024.
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If you're happy to stick to the standard variable tariff, we've calculated how much less you'll pay each month from July 1 depending on the size of your household.
We've also previously listed 30 ways to cut energy bills now.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected]