Experts say there is a window of opportunity for Brits
The current cap, set by Ofgem, stands at £1,641 a year for a typical household on a standard variable tariff(Image: Mirjana Pusicic via Getty Images)
Millions of households are being urged to lock into an energy deal now – with savings of more than £200 on offer ahead of an expected increase in bills this summer.
Experts say a quiet comeback in cheaper fixed tariffs has opened a window for consumers to beat the next rise in the energy price cap, forecast for July. The current cap, set by Ofgem, stands at £1,641 a year for a typical household on a standard variable tariff. But analysts at Cornwall Insight predict it will climb to £1,801 in July as higher wholesale costs feed through into bills. That expected increase is what makes today’s fixed deals stand out.
The cheapest tariff currently available – a 15-month fix from Fuse Energy – comes in at around £1,574 a year, according to Uswitch. That would leave households around £225 better off compared with the projected July cap.
Money-saving guru Martin Lewis has urged householders to switch away from a price cap tariff to a cheaper fixed rate deal without delay.
Taking to X, he wrote: “GET OFF THE PRICE CAP IF YOU CAN. DON’T IGNORE THIS. There’s a window of opportunity to lock in prices below the current Cap to avoid the huge hike coming in July.”
A briefing on the best deals from MoneySavingExpert can be found here.
Fixed deals stage a comeback
Fixed-rate tariffs had all but vanished earlier this year when wholesale gas costs rocketed amid tensions involving Iran. However, they’re now making a return, with approximately 29 deals currently on offer, up from a mere 15 in early March.
Among the leading options identified by Uswitch.com are:
- A 12-month fix from Outfox Energy at roughly £1,586 annually
- Shorter-term deals from Fuse Energy undercutting the current cap
- A 24-month fix from EDF Energy at around £1,690
While some longer-term fixes sit slightly above today’s cap, they could work out cheaper overall if prices climb as predicted.
The anticipated rise in the price cap is being fuelled by elevated wholesale gas prices, with markets responding to disruption risks linked to the Iran conflict and critical global supply routes. Though these wholesale prices have eased in recent weeks, increases in the price cap may well be lower than previously forecast.
Ben Gallizzi of Uswitch said: “Fixed energy tariff prices have been through a lot of turbulence in the past few weeks due to the Iran conflict, but the good news is we’re finally seeing deals drop below the price cap again.
“Households should be assessing their options. With predictions for July energy rates suggesting a staggering increase, this fixed deal would save the average household 15.5% against forecasted prices and would keep them protected through winter. The market is still volatile, and there’s no knowing how long these cheaper deals will stick around for, so now is the time to act.”
