The trend in energy prices is that they have only gone one way-up! With that in mind, a fixed rate energy tariff could be a great way to protect yourself against further price increases. Taking a fixed rate could be a gamble though, so you need to consider all options and if you should fix your energy prices.
This type of tariff benefits from the unit price being set at a certain rate for the life of the tariff. It is important to note that this does not mean your energy bill will remain the same- if you use more energy, your bill will be more. If you use less energy your bill will be less- it is the price you pay per unit of energy that is fixed.
With this type of plan you know exactly what your energy will cost you for the life of the tariff, if you keep an eye on your consumption. These energy tariffs can be fixed for any length of time, for example 12 months, or 5 years. You will normally find that the longer the tariff is fixed for, the more expensive it will be as suppliers allow for the fact that there is more likely to be a price rise if you are on the tariff for a longer period.
Advantages of this type of tariff are:
No! With a fixed rate, whether market prices go up or down, yours will remain the same. With a capped rate, prices will change in line with the market, but will not go over a set limit. So if market prices go down, your rate will go down, but if market prices go up, your rate will not rise above the cap. Capped price tariffs can be a little more expensive than fixed rate but you will benefit from the flexibility.
Our energy price comparison tool can show you the best priced fixed rate deal for your gas and electricity. Just select 'Fixed rate' in the filter box and start comparing prices today