- The cost of new fixed price energy deals has increased by up to £105 in the last month, according to new analysis by uSwitch.com
- 15 energy suppliers, including Extra Energy, Sainsbury’s, OVO and First Utility have replaced their cheapest fixed rate deals with more expensive plans in the last month – with 12 doing so since the EU referendum result
- Increased wholesale energy costs, which have hit a nine-month high, are helping to fuel the recent price increases
- But the average price of the market’s top ten deals is still 11% (£99) lower than it was this time last year
- Consumers worried about rising costs may want to consider switching to a fixed energy deal to safeguard against any future price hikes.
Fixed priced energy deals have increased by up to £105 since the UK’s vote to leave the European Union, according to a new analysis by uSwitch.com, the independent price comparison and switching service.
Fifteen suppliers have replaced their cheapest fixed rate tariffs with more expensive plans in the last month by an average of £38, with the biggest price hikes coming from Extra Energy (£105), Sainsbury’s Energy (£94), OVO Energy (£63) and First Utility (£48). Twelve of the 15 suppliers have increased their prices since the EU referendum on 23rd June.
Increasing wholesale energy prices – which have reached a nine month high after falls since 2013 – have helped fuel the recent increases in the price of some suppliers’ best deals. The wholesale prices of gas and electricity had been falling since Q3 2013 and Q4 2014, respectively, but both have begun to climb in the second quarter of 2016. This, according to independent price reporting agency ICIS, is due to future energy supply concerns, market uncertainty following the UK’s EU referendum result and the falling value of sterling, which is putting upward pressure on the cost of energy imports.
Despite some recent price increases, the market’s top ten energy deals are still, on average, 11% (£99) lower than they were this time last year. Today, many competitive deals are available, up to £315 a year less than the average big six standard variable tariff. Suppliers who have introduced cheaper deals in the last month include npower, which today launched its ‘Online Price Fix August 2017’ tariff at £786 a year. Following the CMA’s energy market investigation, npower is the first supplier to take advantage of new rules from regulator Ofgem enabling providers to offer more than four tariffs. In addition, new and existing dual fuel npower customers switching to the deal via uSwitch.com can also get one night’s free hotel accommodation.
Consumers who are concerned about the impact of the rising cost of energy on their bills may want to consider switching to a fixed tariff to help protect against any future price hikes. In addition to one year deals, some suppliers have also introduced longer term offers including First Utility, who last week launched a three-year fixed deal ‘FU First Fixed June 2019 v2 plus’ priced at £999 a year.
Tom Lyon, uSwitch.com energy expert, says: “For nearly three years, wholesale gas and electricity prices have been falling, leading to cheaper and cheaper fixed term deals for consumers. But with concerns about future UK energy supply, the impact of Brexit and a weaker pound, we are starting to see some suppliers increase the price of their cheapest deals.
“But there are still some very competitive deals on the market, offering significant savings against the average big six standard variable plan. Consumers concerned about rising energy costs should shop around and consider switching to a fixed term tariff, offering protection against any potential future price hikes.”