Money guru Martin Lewis has issued a stark warning to UK bill payers, urging them to act now to avoid paying more for their energy later this year.
Writing in his latest email update, the founder of Money Saving Expert (MSE) cautions that âthe energy crisis is far from overâ, with bills expected to rise again in the final quarter of 2024.
The Ofgem energy price cap has seen two consecutive drops since April, falling from £1,928 in January to £1,568 in July â a reduction of £360. The price cap sets the maximum amount energy suppliers can charge per unit of energy for those on standard variable tariffs, which covers most households. It's expressed as an annual bill for an average home, though it's not the maximum you can be charged as that depends on your energy usage.
However, some experts predict a substantial ten percent increase in the price cap in October, with this higher rate likely to remain in place from January to the end of March. To avoid paying more over the next year, Lewis advises consumers to consider locking in to a fixed price energy tariff now. He recommends several providers offering the most competitive standalone energy fixes for 12 months.
Outfox the Market currently offers the cheapest deal, working out at 1 percent less than the current price cap on average. British Gas and EDF both offer similar rates, while Ovo's deal is 1 percent higher.
Lewis also encourages exploring tracker tariffs, which follow a price index directly, such as wholesale energy costs. While they operate differently, E.on offers a discounted unit rate tracker tariff, beneficial for high energy users. EDF's tracker discounts standing charges, making it more suitable for lower energy consumers. Octopus' tracker tariff adjusts rates based on daily energy costs, offering an average of 31 percent cheaper rates than the Price Cap over the past year, though prices can fluctuate depending on wholesale energy costs.
For those aiming to save on energy bills in the coming year, researching for a better deal is crucial. MSE's Cheap Energy Club allows you to compare all available deals.
Ultimately, Lewis's message is clear: taking action now is key to mitigating the impact of potential energy price increases. By comparing energy tariffs and considering fixed or tracker options, consumers can take control of their energy bills and avoid the financial strain of rising prices.
