Energy suppliers offer fixed deals costing as much as £4,000 ahead of price cap rise

Energy suppliers are seeking to tie customers to fixed deals costing as much as £4,000 a year, as ministers face growing warnings over “untenable” proposed rises to the price cap this spring.

A 12-month fixed deal for a typical household now costs an average of almost £2,500, according to data from comparison website uSwitch.

That is £500 more per year than the £2,000 level that Ofgem, the energy regulator, is expected to increase the cap on variable tariffs to in April.

Ovo Energy, the UK’s second-biggest supplier, is offering a fixed-rate deal worth just under £4,200, according to the data.

Martin Young, an energy analyst at Investec, said the figure was “staggering” but has predicted energy prices will stay elevated or rise even further next year. He said: “Between the end of November through to the last week, fixed price deals have jumped up.”

The figures underline the stark difference between the costs of providing energy and how much suppliers can charge under the cap on bills. In recent months, the cap has lagged behind surging gas prices, shielding consumers from huge price hikes but forcing suppliers to sell energy at a loss.

It is expected to rise from £1,277 to £2,000 in the spring, but if fixed deals remain pricier – and families choose to stay on variable tariffs protected by the cap – Mr Young warned that suppliers could be put under even more financial pressure. The cap is currently updated every six months, meaning it is “for all intents and purposes a six-month fixed deal” that consumers can leave at any time. This means suppliers could be left in the lurch if they buy energy in advance for variable tariff customers only for them to leave when cheaper fixed deals become available.

Related Posts

Property Management in Dubai: Effective Rental Strategies and Choosing a Management Company

“Property Management in Dubai: Effective Rental Strategies and Choosing a Management Company” In Dubai, one of the most dynamically developing regions in the world, the real estate…

In Poland, an 18-year-old Ukrainian ran away from the police and died in an accident, – media

The guy crashed into a roadside pole at high speed. In Poland, an 18-year-old Ukrainian ran away from the police and died in an accident / illustrative…

NATO saw no signs that the Russian Federation was planning an attack on one of the Alliance countries

Bauer recalled that according to Article 3 of the NATO treaty, every country must be able to defend itself. Rob Bauer commented on concerns that Russia is…

The Russian Federation has modernized the Kh-101 missile, doubling its warhead, analysts

The installation of an additional warhead in addition to the conventional high-explosive fragmentation one occurred due to a reduction in the size of the fuel tank. The…

Four people killed by storm in European holiday destinations

The deaths come amid warnings of high winds and rain thanks to Storm Nelson. Rescuers discovered bodies in two separate incidents / photo ua.depositphotos.com Four people, including…

Egg baba: a centuries-old recipe of 24 yolks for Catholic Easter

They like to put it in the Easter basket in Poland. However, many countries have their own variations of “bab”. The woman’s original recipe is associated with…

Leave a Reply

Your email address will not be published. Required fields are marked *