New gas and elec tariff! Oh my!!

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Our fixed rate gas and electric tariff for which we paid £156 a month comes to an in September. We have been v lucky to have been protected from the April rises.
We have just had our new tariff come through - it’s going up to £702 a month. Wtf do I do? I know everyone is in the same boat but holy crap, I had about £500 in my head not £700!

Yes. And predicted to jump again next April

I use (checked past 3 years and you have to take into account cold winter and lockdowns)

Gas per year: 6900 kw
Electric per year: 2500kw

(That's an average but pretty much the same each year)

Currently about £50 in credit and paying £120 a month. This was because I was paying off a debit from winter and was paying £85 plus the increase.

Offered £298 to fix. I currently use on average £85 a month has and electric (£55 electric and £30 gas)

All the sums I've done don't make it worth fixing at that price because even if the price cap triples my bills won't be that high?

Can someone confirm I'm correct?!

You need your kWh to use this and check if it's worth it

https://www.moneysavingexpert.com/utilities/-are-there-any-cheap--fixed-energy-deals-currently-worth-it--/

@itsgettingweird it's not the DD figure you need to worry about its fixing the unit rate and standing charge. Your DD figure can be reduced on fixed rate (as well as increased) but if your usage stays the same, your bill will go up.

That's why the "clever" way to do it is pay monthly on usage, but say you were paying £200 a month DD but your usage is only £90 you should then transfer the £110 to a holding account in preparation for the heavy winter month usage November, December, January, February.

Then when the usage bill is £400 for a month you have the money from the holding account to add on to the £200 usually budgeted for.

You basically should be spreading the cost using your own bank accounts and be on monthly usage billing.

But the fixed rate is a fixed cost per month for 12 months.

I have put my KW above and over a year that costs me currently £85 a month average.

I'm paying £120.

I just can't figure out how paying £298 a month to fix it is economical for me as the price cap is expensive tend to triple and that's nearly quadrupled?

How can I reduce my payments if I chose to fix?

@itsgettingweird it's not

The fixed rate fixes the unit cost, so the kWh and standing charge you pay
The direct debit is what they estimate it will cost with that fixed rate, at your current usage

It's like saying you're fixing petrol prices at £50 per tank - it means nothing without the price per litre, and the price per litre would be the equivalent of what you are fixing

It's never a fixed cost. Cost depends on usage and the DD amount is an estimation of what they think you will use over the course of a year. You can use more or less and will have to pay accordingly.

If you are very economical compared to your previous year's usage then you might end up using fewer units overall and thus paying less. Or if you buy a hot tub or an air conditioner then you'll end up paying more.

Thanks pelo.

It told me it's too high to do the fixed at 140% of current charges. I thought it seemed ridiculously high compared to the predicted rise.

Yeah I get that. But considering it's saying it'll triple and they are offering me a rate to fix way above that it doesn't seem right or worth it. I used the ML website the poster linked to and even that told me it's way to high an offer. It's 140%

@itsgettingweird ah ok in that case I wouldn't fix
There seems to be two fixes really
One not worth it, loads higher (probably hoping people will take it)
One worth it, a tiny bit more and no exit fees (worth taking)

This is a better way of saying what I have been trying to say. You don't need to give it to the energy companies ahead of time. You can keep it in your own account instead.
Of course, some people find that hard to do, but for others it can be really helpful.

You can pay weekly, but the original point about "paying for what you use" still holds when January comes and the weekly bill is £150-200.

Putting the money aside in an account, or virtual account as banks like Starling and Monzo let you do, is better than effectively lending it to the energy supplier, but it definitely isn't true that your energy supplier is "profiting greatly" by doing so. They're losing money hand over fist at the moment - despite the price rises. The 3-4% p.a. benefit they might get on being paid early is peanuts compared to their cost increases.

I made the same mistake a month or so back. Offered rates 30% more than my current variable rate, thought I will sleep on it. Next day they were 60% higher kicking myself. Still didn't fix. Now they are 120% higher (offered same rates as you).
Decided didn't want to risk it increasing again so just took it. Will pay more for now, but hopefully will pay off - who knows. Just wanted the certainty. Slightly regretting it now though as I always seem to make the wrong decision.

Monthly payment increased from £70 a month in January to anticipated £350 a month now.

We are only a two person household.
Above average income (£80k joint), relatively low mortgage payments as we bought when joint income was under £50k and didn't over stretch, so we can absorb it but still going to massively reduce usage to at least try to offset the higher unit rates.

I'm scared for all those who will be in fuel poverty by spring. Makes me so annoyed many big corps are making billions whilst people will be suffering. We need to protest more.

Cancel your Direct Debit and PAYG. Then don't use much!

Don't fix! We are paying £138 a month. Only used £89 last month despite 5 adults (normally 3) so tons of cooking and washing (and kids won't use line!)

But you do get that by January, the same amount of fuel usage will probably cost £300 per (summer, worse in winter obviously) month, yes?

@Whitney168 I’m pretty sure their aware, as been so much talk on news etc about it.

but why tie yourself into months of high fixed rates when you maybe able to get away with a couple of months at a higher price. You will also get your £65 off the bill which will help and if any credit built up that will go towards it.I was with Bulb and no one will take us on a a new customer (looked about 6 months ago and couldn’t fix and def can’t fix now) even if I wanted to fix so we are literally left out to dry on that. Did the useage calculator on MSE and it came up as better off not fixing as 130% increase on our current tariff. I used an example of a quote from a comparison website) before I found they wouldn’t take me as a new customer.

We have the Credit Crunch board which is now out of date given it was about the 2009 crisis so maybe rename that to Cost of Living Crisis?

It's an absolute crazy situation. I'm just going to submit meter readings every month & pay what I owe. I'm not on a fixed rate at the moment as those prices are just nuts. At this rate I'm going to have to sell my organs for extra cash...

Everyone saying they didn’t take the fixed rate as it was too high, please see the new capped rates that have come out today as predicted. The fixes you were offered were that high as electricity and gas per unit price has basically doubled. For everyone not on a fix.
it’s not a cap for that monthly payment, it’s only a cap on what they can charge per unit. So if you heat an outdoor swimming pool all year you are screwed, and if you disconnect your gas you won’t pay.
everyone saying they weren’t going to fix and we’re going to stay on the variable, please know you gas and electric usage cost has doubled. Saying you won’t increase you direct debit won’t matter. When the price of petrol went from £1-£2 saying your only offering £1 per litre does fuck all, energy prices have gone up. You can keep you DD at say the £200 a month you are paying, but you’ll build up debt of £200 a month with same usual age and then have a large bill every 3 months.
please take readings every month for both and especially the day before the 1st October. Please check what you are on and realise that just because you didn’t take the fix doesn’t mean that like everyone in the U.K. your price has gone up.

current prices
Gas 7.37 p/kWh and daily standing of 27.22
electricity 28.34 p/kWh daily standing of 45.34

from 1st October
Gas 15.0 p/kWh daily standing 28.0
Electricity 52.0 p/kWh and daily standing of 46.0

Also note that the predictions were accurate to the pence and worse they are forecasting a similar rise in January and April.
Forecasting January 2023 will be
Electricity 70.42 p/kwh
Gas 19.48 p/kwh

and then April 2023
Electricity 75.7p/kwh and Gas 23.96 p/kwh

This is why people were being advised to fix on the higher rates, as it would fix at what everyone is now paying from October, but would protect them in January and April.

My fixed rate offering was 147-155% higher than the current SVR so I would be paying more than the increased SVR if I had gone for it

And I'm not paying the extra right now. I'll treat the SVR as a short term fix

My fixed rate offer was 8p more pre unit of electricity and roughly equal for gas. But I fixed at that and will overpay until January as come then I will then be saving at least 12p per unit of electricity and 4p for gas when we are usually colder those months than pre Christmas. And worse rates in January so hoping those saving will balance out paying more now.

If in January something magical happens with the war/global warming and prices drop I am free to leave my tarif and go to the variable which will match the price cap, so that was the risk we took to overpay now to save money over the 12months. I fucking hate the gamble we were forced to take but couldn’t have made the January price increases let alone this one.