Switching supplier and fixing is the only way to go now that British Gas has raised its energy prices with others to follow
Households have again been warned to switch to a fixed-price gas and electricity tariff now, or face a winter of high energy bills that look set to continue spiralling upwards.
British Gas customers should be the first to log on to one of the switching sites, but the same is true for anyone who is still on variable price tariffs ? representing a large proportion of homes in the UK.
Last week, British Gas stunned householders by announcing an 18% rise in gas prices and a 16% hike in electricity prices, just eight months after it raised its prices by 7%. The latest increase will affect 9 million customers and will take effect from 18 August. The move by the UK's biggest energy supplier will add almost �200 to the average customer's dual fuel bill, which will rise to �1,288 a year.
British Gas customers have felt the heat more than most. It increased prices in December by 6.9% (or �43) for gas and 6.7% (�28) for electricity. So far this year its customers have seen bills rise by �258 or 25%. This compares with the �239 or 21% increase seen by Scottish Power customers last month.
The other providers ? npower, E.ON, EDF and Scottish and Southern Energy ? are bound to follow suit, although they may not increase prices by quite as much. The result will mean the average dual fuel bill will have increased by 50% since 2007 to about �1,450.
British Gas, as usual, blamed steep rises in wholesale costs, which have increased 30% since last winter. British Gas managing director Phil Bentley says: "We know there is never a good time to raise prices, but we are buying in a global energy market and have to pay the market rate."
However, unless you particularly enjoy bolstering the company's balance sheet, now is the time to switch. British Gas is gambling that its customers won't bother, even though those that do will be able to save about �200 ? depending on consumption ? over the next 12 months. It takes about five minutes on the internet or phone to move to a different supplier.
For most people, the best deals are available from EDF, npower or Ovo Energy. Someone paying British Gas �1,100 on its standard gas and electricity tariffs can save �116 a year if they swap to the current best-value long-term fix, EDF's Fixed Price 2014. This, as the name suggests, caps prices until March 2014, which could be a very good decision if prices continue to rise.
EDF also has a one-year fix ? Fixed S@ver v2 ? which runs until September next year. This is cheaper. Npower's Go Fix 6 dual-fuel tariff will save most households �200 a year. Again, it fixes prices for 12 months, insulating you from the price hikes, whether already announced or on the way.
If you want to send a message to the big six power companies, small operator Ovo Energy is offering fixed rates for a year, and a saving of �161. This company offers straightforward tariffs and it says 15% of the electricity it supplies comes from green sources ? double the industry average.
Joe Malinowski, founder of comparison site TheEnergyShop.com, says: "If you want to avoid paying an extra �200 on your annual bill you have to switch to a fixed tariff, and you have to do it now. Time is rapidly running out."
Meanwhile, there is evidence that the wholesale price rise argument is finally starting to wear thin.
Earlier this year, the regulator, Ofgem, found evidence that energy providers raised prices faster than they cut them (they deny any wrongdoing), and now it is scrutinising wholesale fuel prices paid by the big six. The contention is that some companies are sourcing electricity and gas far more cheaply than their rivals, undermining the argument that they all face the same commodity price pressures. Wholesale costs have risen 30%, but after big falls that were not passed on to customers. Costs are still below those seen at the last big peak in prices in July 2008.
To switch supplier go to one of the many switching sites, put in your postcode and estimated consumption, and you will be told which is the cheapest. The Guardian offers a switching service, provided by energyhelpline, at guardianenergycomparison.co.uk. It allows you to phone for advice, unlike some other sites.
Source: http://www.guardian.co.uk/money/2011/jul/15/fix-gas-electricity-now
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