4.6m consumers hit by end of fixed price energy plans

Last summer, customers flocked to fix their energy prices. Now, they could see energy costs shoot up by £100 as their deal comes to an end, according to a report from uSwitch.com. The report states that average bills could rise from £1,045 to £1,145, affecting as many as 4.6 million UK households currently on fixed or capped energy plans.

When average energy prices rocketed by 42% or £381 in 2008, many householders took up their energy providers’ offers of a fix or cap on prices. But from July, these deals will start to come to an end, so consumers need to begin shopping around to ensure they are not moved back to the standard tariff and left on a deal that costs them a fortune.

uSwitch.com has also warned consumers not to jump at the chance to switch straight onto another fixed or capped deal. While suppliers are likely to offer such deals, with energy prices on a downward trend, it is important to secure a deal that allows you to benefit from any future falls in energy costs.

Last month, uSwitch.com revealed that 12.5 million households in the UK could be paying up to £344 a year more for their energy simply because they are on suppliers’ standard tariffs rather than online energy plans. So shopping around at the end of a fixed deal could actually see your prices fall rather than rise.

Will Marples, energy expert at uSwitch.com, said:

“Without a doubt, those who fixed their energy prices last year, avoiding the price hikes that hit other households, have done really well. However, with their price protection coming to an end they could face a bill shock if they don’t start looking around for their next deal. They cannot afford to just move onto a standard plan or accept a new fixed or capped deal from their supplier without doing their homework first.”

“Online energy plans are currently offering consumers the lowest prices, but just 5% – 1.3 million households – are signed up to one. I would urge anyone coming off a fixed plan in the near future to follow three simple steps to make sure they are getting a good deal: move to dual fuel, pay by direct debit and sign up to an online plan.”

“Those who are tempted to fix again need to be aware that most fixed or capped plans now carry an exit fee if you leave before the fixed or capped period finishes – consumers should always check the small print carefully and ensure that an energy plan meets their needs before signing on the dotted line. Fixed plans are definitely right for some consumers, but in a time of potentially falling prices they could be the wrong move for many more.”

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