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Ditch fixed-rate energy deals
By Rachel Williams
At last, energy bills have started to fall.
While the price reductions from the six largest suppliers are not in line with reductions in the price of wholesale gas, the cuts will come as a welcome relief to households that have seen gas prices rise by as much as 94% in the last three years and electricity prices by 60%.
But the estimated three million households that took out heavily advertised capped rate tariffs - guaranteeing that prices wouldn't rise above a set level - aren't benefiting from falling prices. Given that the suppliers charge a premium for this peace of mind, these deals are now looking decidedly expensive.
Just because these rate guarantees don't expire for a number of years, however, doesn't mean you have to stick with them. According to research from Moneysupermarket.com, the penalty cuff charges that tie you into these deals have now been removed on the majority of tariffs.
But as these charges only vary between £20 and £45, the savings you can make by switching far outweigh any fee. For example, SimplySwitch.com claims that if customers who signed up to the EDF Energy Price Protection plan switch to British Gas Click Energy, they could see their annual gas and electricity bill fall from a typical £978 a year to £740.98 - a saving of more than £226.
So if you're on one of these tariffs, it's worth visiting Interactive Investor's Cut Your Bills section to shop around for a better deal. Even if you're not on a capped tariff, if you haven't reviewed your supplier in the last 12 months it's worth checking you're still getting good value for money.
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