- 86 fixed deals are set to end this month, adding £28 million to energy bills for 200,000 households
- Customers who roll onto their suppliers’ default tariffs face a bill increase of up to £302 (36%) and could then see their bills go up again on 1 April
- Default tariffs are currently capped at £1,137 but are likely to be hiked in April when the price cap level could increase by as much as £100
- Two thirds (63%) of the deals ending this month cost less than £1,000 per year – but there are only eight tariffs under £1,000 available today
- uSwitch.com urges households to beat the price rises – and the price cap – by switching to a new fixed deal.
Households face a staggering energy bill increase of up to £302 (36%) as 86 fixed deals come to an end this January, according to new data from uSwitch.com, the price comparison and switching service. The expiring deals will add £28 million to the energy bills of approximately 200,000 households – roughly equivalent to the population of Edinburgh.
Customers on these tariffs will automatically be rolled onto their supplier’s default tariffs. The average hike will be £140 per year, but households facing the biggest increases are those with Together Energy (£302) and Peterborough Energy (£258). The biggest rises facing customers of the big six suppliers will be ScottishPower (£210) and British Gas (£133).
A new energy price cap was introduced at the beginning of the year but only sets an upper limit for a supplier’s default tariff – usually the most expensive on the market. In fact, at £1,137 per year for the average user, the cap is still £165 more expensive than the cheapest fixed deal on the market.
Furthermore, Ofgem is expected to raise the level of the energy price cap by £80-£100 on 7th February, effective from April, meaning that customers with deals ending this month face a double whammy if they don’t take action.
Of all the tariffs ending this month, six in ten (63%) are priced under £1,000 per year – but increases in wholesale costs mean there are now only six tariffs on the market priced under £1,000. However, there is still plenty of choice and savings to be made, with 147 tariffs cheaper than the price cap that people can switch to today. And Ofgem rules allow customers to switch suppliers without paying exit fees 49 days before their plan end date, so households affected can switch and save now without worrying about charges for leaving early.
Rik Smith, energy expert at uSwitch.com, says: “Around 200,000 households will see their energy deal end this month and with the threat of price hikes around the corner they are set for a double blow unless they take action.
“Those affected should have received a letter over the Christmas period telling them their bills will go up, but understandably there are other distractions at that time of year. However, it’s vital they now take action and lock in a new fixed deal. Not only will they save money straight away, they’ll also protect themselves from the inevitable wave of price rises that will hit on 1 April.”
Table 1: 10 most expensive increases for fixed deals ending in January 2019
Source: uSwitch.com correct as of 17 January, 2019
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