Major energy supplier to pull cheapest fix that’s £163 less then the price cap in HOURS – how to find the best deal
A MAJOR energy supplier with five million customers is set to pull a fixed energy deal that is currently the cheapest on the market.
New and existing customers who sign up for EDF Energy‘s Essentials Fixed 1Yr Oct25v3 tariff are promised savings of £163 a year.
This plan costs a typical household £1,553 per year, making it cheaper than Ofgem’s current price cap.
At the beginning of this month, the 29 million customers on standard variable tariffs linked to Ofgem’s price cap saw their annual bills increase by £149, rising from £1,568 to £1,717.
If these households were to switch and take up EDF’s offer, they’d save £163 over the next 12 months.
The tariff is available to new and existing EDF customers and requires a smart meter or an agreement to have one installed.
The 12-month fixed offer includes a £25 exit fee per fuel or £50 for a dual fuel tariff.
But households wanting to switch will only have until midnight to do so.
EDF Energy’s offer is the cheapest among the country’s largest energy suppliers, including British Gas and Octopus Energy.
It’s not unusual for suppliers to reprice or remove their fixed energy tariffs in reaction to fluctuating wholesale market conditions.
This means that the best deals can be pulled at any time.
How do fixed deals work?
Fixed deals work to protect customers from bill hikes if Ofgem were to increase the price cap in the future.
Customers on their supplier’s standard variable tariff see their energy prices change every three months, as these are tied to Ofgem’s price cap.
However, those who lock into a fixed energy deal are charged the same gas and electricity rates throughout the contract’s term.
Of course, doing so carries a slight risk of you paying more than those on the standard variable tariff if Ofgem’s energy price cap were to fall within your deal’s term.
However, experts say this risk is minimal as analysts at Cornwall Insight predict that the energy price cap will rise again in January.
The price cap is reviewed every three months in Oct, Jan, April and July, and can go up or down depending on what’s happening in the wholesale energy market.
Currently, those on the standard variable tariff (SVT) have their rates capped by Ofgem at the following levels:
- 5.48p per kilowatt hour (p/kWh) for gas
- 22.36p per kWh for electricity
- A standing charge of 31.66p per day for gas
- A standing charge of 60.99p per day for electricity
For a typical household that uses an average of 11,500kWh of gas and 2,700kWh of electricity every year, these rates will cap bills at roughly £1,717 .
As this is only an estimate for a typical household, if you use more energy, you’ll pay more.
But if you’re offered a fix that’s cheaper than the current price cap, it’s always worth considering.
Elise Melville, energy expert at Uswitch, said: “There are many fixed energy tariffs on the market right now that are cheaper than the current energy price cap.
“Some are offering savings of over £150 per year for households with average energy usage.
“The January 2025 price cap is predicted to only drop by 1%, so it’s worth locking in a cheaper fixed rate now that will save you money throughout winter.”
Outfox the Market is currently offering the second cheapest deal on the open market right now to new and existing customers.
Its Fix’d Dual Oct24 v5.0 tariff costs a typical household £1,555 a year.
This means it is £162 cheaper than Ofgem’s October price cap.
It comes with a £25 exit fee per fuel or £50 if you lock in with a dual fuel tariff.
British Gas’ The Fixed Tariff v5 tariff matches the Outfox the Market deal, but it comes with a £50 exit dee per fuel.
Octopus Energy’s 12M Fixed October 2024 v1 costs £1,566 a year – £151 less than Ofgem’s October price cap.
This deal also comes with no exit fees, so customers are free to ditch and switch supplier at anytime they wish.
Remember to always compare prices before switching, as energy tariffs vary widely, and costs differ depending on where you live.
What energy bill help is available?
THERE'S a number of different ways to get help paying your energy bills if you're struggling to get by.
If you fall into debt, you can always approach your supplier to see if they can put you on a repayment plan before putting you on a prepayment meter.
This involves paying off what you owe in instalments over a set period.
If your supplier offers you a repayment plan you don’t think you can afford, speak to them again to see if you can negotiate a better deal.
Several energy firms have grant schemes available to customers struggling to cover their bills.
But eligibility criteria varies depending on the supplier and the amount you can get depends on your financial circumstances.
For example, British Gas or Scottish Gas customers struggling to pay their energy bills can get grants worth up to £2,000.
British Gas also offers help via its British Gas Energy Trust and Individuals Family Fund.
You don’t need to be a British Gas customer to apply for the second fund.
EDF, E.ON, Octopus Energy and Scottish Power all offer grants to struggling customers too.
Thousands of vulnerable households are missing out on extra help and protections by not signing up to the Priority Services Register (PSR).
The service helps support vulnerable households, such as those who are elderly or ill, and some of the perks include being given advance warning of blackouts, free gas safety checks and extra support if you’re struggling.
Get in touch with your energy firm to see if you can apply.
What are the alternatives?
Customers unwilling to commit to long-term fixed energy deals may want to consider flexible tariffs.
For example, E.ON Next‘s Pledge variable tariff offers a fixed discount of around three per cent on the price cap rates for 12 months.
It will save the average household around £50 a year but comes with a £50 exit fee if you switch before the year ends.
The deal is available to both new and existing customers.
EDF Energy’s Ensure Tracker works in a similar way and offers a £50 discount off the price cap’s standing charges for 12 months.
For a bigger reward but at a higher risk, Octopus Energy offers two variable tariffs which track wholesale gas and electricity costs.
Customers on the Octopus Tracker see their prices change daily, but unit rates have remained consistently lower than the price cap in recent months.
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