What is a fixed rate tariff?
It’s pretty much what it says it is – it fixes the rate of your energy for a certain length of time – typically 12 months.
It doesn’t mean your energy bills stay the same price each month – those will go up or down depending on how much gas or electricity you’ve used. It actually means that the cost of your energy per unit stays the same, regardless of what happens to the wholesale price.
What's the difference between a fixed and flexible tariff?
The terms of a fixed rate tariff are usually set out in a contract and bound by certain conditions. A flexible, or variable tariff on the other hand isn’t normally contract bound. This means on a variable tariff the bill payer can change supplier (or tariff) whenever they feel like it, without any restrictions like exit fees. The downside is that flexible tariffs tend to be more expensive.
How long does a fixed rate tariff last?
Most fixed rate tariffs last 12 months but some suppliers do offer longer terms, up to three or even four years.
Can a fixed rate energy tariff save me money?
Fixed rate tariffs tend to be one of the cheaper options and are good for budgeting – because as long as your energy use year-on-year is consistent, your bills will remain the same.
Of course, if you’re using more gas and electricity in the winter months, you’ll need to make sure you factor this in when you budget your household expenses.
The drawback of fixed tariffs is that if energy prices go down – you won’t benefit because you’re locked into paying the fixed price until the end of the term.
What other types of energy tariffs are there?
As well as fixed and flexible (variable) rate tariffs, suppliers may offer:
- Capped tariff, energy prices are capped at a certain point and the cost per unit won’t go above it. Unlike a fixed rate tariff – prices in a capped agreement, can go down.
- Dual fuel tariff, this is where gas and electricity are bought from the same supplier.
- Online tariff, this is often the cheapest option available because there’s no paperwork, as all correspondence and account management is done online.
- Green tariff, these plans have a focus on the environment such as sourcing energy from renewables.
- Timed tariffs such as economy 7, offer cheap ‘off-peak’ energy during certain times, anything used outside of those hours can be a lot more expensive.
Head to our Energy tariffs explained page for more details and to find a tariff to suit your household.
How can I switch to a fixed rate energy tariff?
It’s never been simpler – just choose the ‘fixed rate tariff’ option when we ask which tariff you’re interested in.
We’ll then search for available fixed rate tariff deals – all you need to do is pick one you like the look of. To get further information, just hit the ‘more details’ button and as if by magic, you’ll get a whole load of facts about the tariff in question. If you want to switch there and then, click on ‘switch now’.
Your new supplier will contact you and take the lead in the wholeswitching process – that means, they’ll contact your existing supplier and tell them you’re leaving as well as sort out the day of the switchover.
The only things you need to do are take meter readings and pay off outstanding bills, or if you’re in credit chase up money that you’re owed by your old supplier.
What do I need to know before I switch?
All the information needed to switch can be found on a recent bill. If there isn’t one to hand, don’t worry, your search can still be run on estimations such as how much you roughly pay a year or month.
When you start a quote, we’ll ask you for things like the name of your current supplier and tariff, as well as how much energy you use (this can be in kilowatt hours (kWh) or in pounds). If you’re struggling to make head or tail of your bill, we can help – just visit our Understanding your bill page and we’ll show you where to find the answers you need from your bill.
If you’re thinking of leaving your current supplier partway through a contract, then you’ll need to find out if there are any exit fees. If there are, just be mindful that those fees could cancel out some of the savings you’ll potentially make by switching.
If there are exit fees and they aren’t worth paying, then just bide your time. Ofgem (the energy industry regulator) have a new rule that energy suppliers need to tell customers when their contract is due to end 42-49 days before it actually does. If you decide to switch during that time, then you can’t be charged an exit fee.
It’s also good to know that if you change your mind, you have a 14-day cooling off period – phew.
One last thing – if you have owed money to your existing supplier for more than 28 days, then you can’t switch supplier until you have paid it back.
Will my energy be interrupted if I switch to a fixed rate tariff?
Nope – anyone contemplating switching but worried about sitting in the cold and dark, can banish those thoughts. Most suppliers have signed up to the Energy switch guarantee, which is a promise that your switch will be simple, easy and quick.
All your gas and electricity comes into your home through the same pipes, wires and cables so there won’t be any digging or poking around. The only thing you’ll notice are that bills come from a different supplier and will be lower (hopefully – it’s kind of the whole point of switching).
Can I switch gas and electricity to a fixed rate tariff?
In short – yes. Your gas and electricity can both be switched to a fixed rate tariff or not – whatever works best for your household.
Just because you buy one type of energy one way doesn’t mean you have to buy the other to match. You can opt for a dual fuel fixed rate tariff which would give you both gas and electricity at a certain price for an agreed length of time.
Or, you can buy your gas and electricity on separate fixed rate tariffs from different suppliers if that works out cheaper. There’s an assumption that dual fuel costs less – it can do, but don’t presume so.
Will I get a smart meter if I switch to a fixed rate tariff?
It depends on the supplier and where they are with their smart meter rollout.
Although smart meters are a government initiative, the project is being managed by individual energy firms, so when you’ll get one, depends on who your supplier is.
Every household in the UK is entitled to a smart meter and your supplier has to have offered you one by 2020.
Smart meters aren’t going to lower your bills on their own – they are simply there to make you aware of how much energy you’re using. They will also mean an end to estimated bills because they relay real time information about your energy use back to the supplier. Visit our Smart meters hub for the low down.
How do I compare fixed rate tariffs?
Think about your budget and work out what else is important – such as green energy or customer service.
Once you’ve worked out the basics, just tell us what you’re looking for. You can then refine your search results even further, by choosing things like supplier rating, payment, or tariff type.
Whatever tariff you’re after, search with us – you could be just a few seconds away from a great deal.