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ScottishPower to pull cheapest plan after unprecedented demand

Another one bites the dust

scottishpower

Time is running out for consumers to snap up a cheap energy deal and to protect themselves from potential price hikes this winter.

Another plan pulled

ScottishPower has announced it is to withdraw the cheapest plan on the market*, leaving little time for households to secure the cheapest deal.

The warning comes as First Utility pulls its market-leading iSave Fixed v3 plan off the market with immediate effect. This plan, at £1,040 a year, was the cheapest on the market, offering customers a competitive price with a fixed price guarantee until the end of 2013.

It had left ScottishPower’s Online Fixed Price Energy January 2014 at £1,052 a year as the cheapest plan on the market. However, ScottishPower has now revealed that it is pulling this plan too and replacing it with one that, at £1,099 a year, is £47 more expensive.

This new deal, Online Fixed Price Energy March 2014 guarantees prices for the next two winters and, just like its predecessor, doesn’t carry any exit penalties. This is important as it leaves customers with the flexibility to switch again in the future should a better deal come onto the market.

However, at £1,099 a year, the new ScottishPower plan is not the cheapest energy plan on the market. This is now Sainsbury’s Energy’s Online variable September 2013 plan, which at £1,068 a year comes in £31 a year cheaper than ScottishPower’s fixed price deal.

Neil Clitheroe, ScottishPower Chief Executive Officer, Retail and Generation said: “The unprecedented demand for our latest products shows quite clearly that customers value the protection and peace of mind that fixed price products can offer.”

Best Buy plans:

Supplier

Plan Name

Price

ScottishPower

Online Energy Fixed January 2014

£1,052

Sainsbury’s Energy

Online Variable September 2013

£1,068

npower

 

Energy Online October 2013

£1,071

Ovo Energy

New Energy Fixed*

£1,088

E.ON

SaveOnline 12

£1,113

British Gas

Online Variable Aug 2013

£1,120

 

Average

£1,084

*Not available in Scottish-Hydro region. Based on a medium user consuming 3,300kWh electricity and 16,500kWh gas with bill sizes averaged across all regions.

Cost of fixed price plans ‘creeping upwards’

Today’s changes in the energy market will be worrying for households across the UK. One of the most popular fixed price deals – EDF Energy Blue + Price Promise April 2014 – was removed at the end of August.

This too had no exit penalties and its removal has left customers looking for peace of mind coupled with no exit penalties with a dwindling range of options.

Tom Lyon, energy expert at uSwitch, says: “What First Utility and ScottishPower’s moves today mean is that consumers who want to fix their energy prices cannot afford to hang around.

The cost of fixed price plans is creeping upwards and exit penalties are creeping back in.

The fact is that consumers acting now are still able to get an exceptional deal – a low price, coupled with a price guarantee and no exit penalties.

But what is now extremely clear is that this type of offer is not going to be around for long.”

Energy tariffs timeline

22/08/12 SSE Price rise – The SSE group announced a 9% price rise on average for both gas and electricity to take effect from the 15th of October

30/08/12 EDF Energy pulls cheapest tariff – EDF pulled the cheapest plan on the market, the Blue + Price Promise, in the face of growing demand

10/09/12  First Utility pulls cheapest tariff – First Utility reacts to growing demand and pulls the then cheapest plan on the market, the iSave Fixed V3

11/09/12 ScottishPower pulls cheapest tariff – ScottishPower is the next to feel the heat, pulling Online Fixed Price Energy January 2014

11/09/12 OVO now the cheapest fixed – OVO Energy’s New Energy Fixed now the cheapest plan. The plan is £48 a year on average more expensive than EDF Energy’s Blue Price Promise Plan but with £60 exit penalities. The plan is fixed for one year from the start date.

*This plan has now been withdrawn from the uSwitch site.
Learn more:

What is a fixed price energy tariff?

Who is the cheapest energy supplier?

See if you’re overpaying for your energy

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