The cheapest fixed energy deals that could save you £184 and dodge Ofgem’s brutal 4% October price rise

HOUSEHOLDS are being urged to switch energy deals now after Ofgem confirmed bills will rise 4% from October. The energy price cap will jump from £1,663 to £1,723 for a typical dual-fuel household paying by direct debit on October 1. That’s £147 more than the same period last year, when the October cap stood at £1,576. The rise comes just as millions of homes start preparing to put the heating on again as the weather begins to turns colder. Sign up for the Money newsletter Thank you! Cornwall Insight has predicted the cap could rise a further 9% in January, to £1,872. That would mark the third price hike in a row. The price cap is reviewed every three months by regulator Ofgem and sets the maximum a supplier can charge for each unit of gas and electricity, as well as a standing charge, for customers on default tariffs. It does not cap the total bill, so what you actually pay still depends on how much energy you use. Anyone who does nothing is automatically moved onto their supplier’s standard variable tariff, which tracks the price cap and rises or falls every three months. A fixed deal works differently. Most read in Money Once you sign up, the price you pay per unit of energy is locked in for the length of the contract, usually between one and two years, regardless of what happens to the price cap in the meantime. That means if the cap rises again in January, as expected, anyone on a fixed deal taken out now would be protected from the increase. Comparison site Uswitch.com says there are currently 21 fixed tariffs on the market that beat the new October price cap. The cheapest, according to Uswitch, could save a typical household £184 a year compared with the new standard rate. Sabrina Hoque, energy expert at Uswitch.com, said: “Households on standard tariffs are facing a 4% price hike on their energy bills from October, with another increase expected in January.” She added: “The good news is there’s a way to dodge these increases. There are currently 21 fixed energy deals on the market that beat the new October cap, with the cheapest offering a typical household around £184 in savings a year compared with standard rates.” Ms Hoque said locking in a deal now would protect households from further hikes. She said: “Locking in a fixed tariff means you’ll start saving against the current price cap today, and you’ll shield your bills from any future rises for the duration of the tariff.” She urged people not to feel put off switching. Hoque said: “It’s easy to feel confused or powerless about rising energy prices, but households who act now to fix their energy deal will benefit now and through the coldest months.” The cheapest deal currently on the market is Fuse Energy’s 18-month fixed tariff, with an average annual bill of £1,539. That works out at £184 below the new October cap. Fuse Energy also offers a 14-month fixed deal priced at £1,550 a year, which is £173 cheaper than the October cap. E.ON Next has a 24-month exclusive fixed tariff priced at £1,562, saving customers £161 a year compared with the new cap. Outfox Energy has two fixed deals beating the cap by more than £150 a year, one lasting 24 months and priced at £1,565, the other an 18-month deal priced at £1,566. EDF Energy, Ecotricity and British Gas also feature among the cheapest tariffs, each undercutting the October cap by between £65 and £114 a year. Most fixed deals come with exit fees if you leave early, typically ranging from £50 to £100 per fuel, so households should check the terms before signing up. Anyone wanting to compare deals can do so through comparison sites such as Uswitch or Confused.com, or by going direct to suppliers. Comment now