Millions of households are being advised to consider changing their energy provider due to a recent increase in winter energy prices.
The regulatory body, Ofgem, has raised the price cap by 2% starting today, resulting in the average annual gas and electricity bill reaching £1,755. This price hike coincides with the colder weather, meaning consumers will likely use more energy at the higher rates.
Experts suggest that the approximately 34 million customers on standard variable tariffs affected by the price cap could benefit financially by switching to fixed-rate deals. According to MoneySuperMarket, switching to a fixed deal could save the average customer up to £271, with the cheapest deals currently ranging between £1,429 and £1,643.
Laura Hinton from MoneySuperMarket Energy highlighted that a significant portion of households, around 66%, are on standard variable rates, leading to increased bills during the colder months as energy usage rises.
Consumer group Which?’s energy editor, Emily Seymour, emphasized the importance of exploring alternative deals below the price cap to potentially save money. She recommended looking for deals cheaper than the current price cap, with durations not exceeding 12 months and without substantial exit fees.
Furthermore, debt charity StepChange reported a 32% increase in energy-related arrears among its clients over the past two years. Simon Trevethick, head of communications at StepChange, expressed concern about rising bills coinciding with the colder weather, impacting household finances.
In line with forecasts from industry experts at Cornwall Insight, the price cap is predicted to decrease to £1,725 annually for a typical dual fuel household starting in January, only to rise by £100 in April next year.
Minister for Energy Consumers, Martin McCluskey, announced initiatives to support vulnerable families during the winter season, including expanding the Warm Home Discount to more than six million families and launching a significant home upgrade program to enhance energy efficiency in up to five million homes.
In efforts to save on energy costs without switching providers, the Energy Saving Trust offered cost-effective tips that could save households between £200 to £300 annually on energy bills. Suggestions included addressing draughts, bleeding radiators, insulating hot water tanks and pipes, adjusting thermostat settings, and installing heating controls for optimal energy usage.
For those considering switching providers, MoneySuperMarket recommended various deals, such as Home Energy’s Fair Variable Dual tariff, Outfox Energy’s ‘Outfox the Price Cap – Oct 2025 12M v7.0’ deal, and E.on Next’s ‘Next Direct Fixed 12M v5’ deal. Uswitch also highlighted competitive deals from Outfox, Fuse Energy, and EDF Energy’s ‘Simply Fixed Oct26v4’ deal.
It is essential to note that the savings on fixed deals depend on the energy unit rate, and overall bills are influenced by individual energy consumption patterns.