Is It A Good Idea To Sign Up To Static Energy Prices?
In the last year electricity prices have risen by an average of 6.4 percent, with gas rates averaging an increase of 5.6 percent as well. With this in mind, many energy consumers are opting to sign up to deals that offer static energy prices for a set period of time; usually one year, but deals lasting up to four years are available. But is this a good idea?
Of course, signing up to a fixed rate deal can provide peace of mind and security, meaning that households can know roughly how much their next bill will be, therefore avoiding unpleasant surprises. The money that could be saved in this time could go toward a essential services like domestic boiler insurance , further preventing unexpected costs should it suffer a failure.
It is wise to visit an energy price comparison website to find out about the pros and cons of signing up to a deal of this nature. In a week where British Gas and EDF Energy have announced they are lowering their electricity rates with immediate effect, it is quite possible that people who have signed up to fixed rate energy contracts in the last six months will now be paying a higher rate. Fixed price energy plans also tend to feature high cancellation fees, which could negate the savings customers on these plans stand to make if they decide to end their contract early.
Those looking to move providers and sign up to a fixed rate deal should also take the time to study the different forms of fixed tariff that are available. You can sign up to a fully fixed deal where you agree to pay a set price per unit for your electricity or gas for the entirety of the contract.There are also capped deals available, where you can make sure that the price you pay will not rise above an agreed amount. The benefit of a deal like this is that if prices drop, your rate per unit will too. A fixed discount package is not really a fixed tariff. On deals like this you will be offered a discount on the price per unit, usually a percentage figure. The amount you pay will rise and fall throughout your contract but you will receive the discounted percentage the whole time.