Customers of major energy suppliers including British Gas, E.ON, EDF and OVO can make a £112 saving with one simple change.
UK households are urged to switch to a twelve-month fixed energy tariff to make the saving as energy bills are increasing yet again from January.
Household energy bills will go up by 1.2% from Wednesday as regulator Ofgem changes its price cap, meaning the typical bill for homes in England, Scotland and Wales will rise from £1,717 to £1,738 per year.
The new price cap means bills will be £21 more expensive per year, adding an additional £1.75 per month to bills.
The price hike follows a previous 10% rise in October, with Ofgem blaming the increase on “volatile international markets” affected by events in Russia and the Middle East, meaning energy costs will continue to fluctuate.
Ofgem changes the price cap for households every three months, largely based on the cost of energy on wholesale markets, but it doesn’t limit total bills.
The cap sets the maximum price that energy suppliers can charge consumers in England, Scotland and Wales for each kilowatt hour (kWh) of energy they use, but households still pay for the amount of energy they use. So those that use more, pay more.
But price comparison website Uswitch says households can save up to £112 per year against the price cap by moving to a 12 month fixed tariff and advises that people shop around for the cheapest deals.
It’s particularly important to lock in cheap prices now as forecasts suggest energy costs will rise yet again in April as market “turbulence” and price cap reforms feed through to bills.
Ben Gallizzi, energy spokesman at Uswitch.com, said: “This predicted rise in April’s price cap would mark a third consecutive hike for energy prices, adding to the current pain for households.
“This increase could mean the average household on a standard variable tariff would pay 1% more on their rates from April – on top of the 1% increase in January that we’re yet to pay. This is an early prediction so this 1% rise isn’t guaranteed, but energy prices remain uncertain.
“There are now a range of fixed deals available that are significantly cheaper than the predicted price cap for January, so it is well worth running a comparison to see how much you could save. Right now, the average household could save up to £112 per year against the current price cap by switching to a twelve-month fixed deal.”
Ofgem has also urged households to contact their energy suppliers to check what support is available and to shop around for cheap deals.
Tim Jarvis, director general of markets at Ofgem, added: “With more tariffs coming into the market, there are ways for customers to bring their bill down so please shop around and look at all the options.
“In the short-term though, anyone struggling with bills should speak to their supplier to make sure they’re getting the help they need and look around to make sure they’re on the best, most affordable deal for them.”
