Households are urged to check if they can swap to a fixed rate tariff following news that the energy price cap will rise by 6.4% in April.
The increase, which applies to standard variable rate (SVR) tariffs, is larger than previously expected and will add an extra £111 to the average annual energy bill for a typical duel-fuel household.
Despite the sizeable savings they could make with a fix, as many as 26 million households are estimated to still be on SVR tariffs.
Fixed-rate energy tariffs are not affected by price cap changes, as they enable customers to lock in unit rates for a set period of time – such as 12 months. However, locking in rates can mean people miss out on price cap reductions while they’re still in contract.
Based on current forecasts, which estimate the price cap won’t fall to the current level for at least a year, Money Saving Expert founder Martin Lewis said opting for a fixed deal is a “no-brainer”.
Speaking on BBC Radio 4’s Today Programme, Mr Lewis said the cheapest fixed deals currently available were around 4% cheaper than the current price cap. He suggested consumers check for deals at around midday on Tuesday, and make sure to use comparison sites that take in the whole market.
Richard Neudegg, director of regulation at Uswitch.com, said: “Millions of households still sitting on standard tariffs, which follow the price cap, are about to see their bills rise for the third time in a row. The hat-trick hike of 6.4% in April will add £111 to the average annual bill in yet another price cap blow for standard tariff customers.
“Consumers can take action to avoid this. If you are still riding the rising rates, now is the time to find a better deal. There are plenty of fixed deals available that are cheaper than today’s rates, let alone the higher April prices. A fixed deal could protect you from further price increases for 12 months or longer.”
According to Uswitch, here are the top 10 cheapest fixed-rate energy tariffs at the time of writing, from Octopus to British Gas.
What is the energy price cap?
The energy price cap, introduced in 2019 by the regulator Ofgem, prevents service providers from making excessive profits from customers.
The cap is in place to stop energy suppliers from charging any prices they like per kWh of energy used while also considering real wholesale energy prices.
This prevents suppliers from purchasing energy at a higher price than what they are selling and is meant to ensure a “fair” price for all. The price cap is set for each gas and electricity unit in England, Wales, and Scotland. Energy in Northern Ireland is regulated separately.
Ofgem reviews the price cap every three months to set a level on how much providers can charge for each unit of energy.
From April 1 to June 30, 2025, the energy price cap per unit will be:
- Electricity: 27.03 pence per kWh (up from 24.86 pence per kWh). The daily standing charge will drop to 53.80 pence from 60.97 pence.
- Gas: 6.99 pence per kWh (up from 6.34 pence per kWh). The daily standing charge will rise from 31.65 pence to 32.67 pence.
Find out how much your energy bill could increase by using our calculator.
