Should you fix your energy prices?

Last Updated: 7th March 2025

"Yes! You should fix." As of April 2025, energy prices will see a significant increase of 6.4%, taking the average UK energy bill to £1,849 for gas and electricity, up from £1,738. With energy suppliers currently offering fixed-rate energy tariffs averaging £1,585 annually, securing a fixed rate now could save you approximately £264 or 14.3% compared to the new price cap. 

Our expert says

"Switching to a fixed energy tariff will save the average customer over £200 a year. In February, we saved one customer £1,598 a year on their energy bills switching them to a 12-month fixed tariff. There are big savings to be made so do a comparison and start saving money."

- Scott Byrom, Chief Executive Officer

Switching to a "fixed" energy tariff means that your unit rate and daily standing charge are locked in. Thus, your bill will only increase if your usage does; if you use less, you'll pay less.

Here's what you'd pay under the upcoming Energy Price Cap if you don't switch:

• Gas Unit Rate: £0.07 per kWh
• Electricity Unit Rate: £0.27 per kWh
• Gas Daily Standing Charge: £0.33
• Electricity Daily Standing Charge: £0.54

And here's what you could be paying with a fixed-rate tariff:

• Gas Unit Rate: £0.05 per kWh
• Electricity Unit Rate: £0.21 per kWh
• Gas Daily Standing Charge: £0.28
• Electricity Daily Standing Charge: £0.33

Comparing tariff types:

• Fixed Tariffs: Your rates are fixed, meaning no surprises for the duration of the tariff, usually 1 to 2 years.
• Variable Tariffs: Rates can fluctuate based on market conditions.
• Capped Tariffs: Rates can decrease but won’t exceed a set upper limit.
• Tracker Tariffs: Rates follow the market but are set at a margin below the Energy Price Cap.

Benefits of fixed tariffs: Beyond the immediate savings, fixed tariffs offer predictable billing, aiding in budget management regardless of market volatility.

Keep in mind: Energy prices can change rapidly due to various factors, including global geopolitical events and fluctuations in the wholesale market, as evidenced by recent developments globally. Thus, locking in a rate with a fixed tariff can shield you from unexpected hikes and provide peace of mind.

For detailed comparisons and to find the best fixed tariff for your needs, visit our Fixed Price Energy Guide.

How long should you fix for?

This is a personal choice about how much reassurance you want about your energy costs. However, being realistic, given the need to rapidly increase investment in renewable energy and the infrastructure of our grid to handle this increase in electricity demand, energy prices are unlikely to fall. In fact, if you look back over the last 10 years, energy prices have increased by an average of 5% every year. 

Here you need to consider the premium you're paying to fix for longer (if that is indeed the case), how comfortable you are locking in your energy costs at that rate for the necessary period of time, and, should energy prices fall at some stage, what is the "exit fee" of the tariff to terminate the contract. These "exit fees" have increased significantly over the years an range from £50 to £200 per fuel i.e. £100 to £400 for a dual fuel (both gas and electricity) energy tariff. 

How to find the best fixed energy tariff?

Our quick guide for this would be:

1. Ensure you have a copy of your most recent energy bill to hand and identify your projected or estimated annual consumption in kilowatt-hours (kWh).
2. Visit an Ofgem accredited price comparison site (such as TheEnergyShop.com) to carry out your energy comparison.
3. Ensure that the tariffs are fixed and look at the term of the deal, e.g., 1, 2, or 3 years.
4. Check the applicable exit fees to see how much you would be charged if you switched energy during the tariff's term.
5. Visit websites such as TrustPilot to look at customer reviews for the gas and electricity supplier you have shortlisted. It's also a good idea to check out the energy supplier's Twitter feed to see what customers are messaging them about. You want to see good responses and look out for any trends, e.g., issues with call centre support.
6. Once you have picked your new energy tariff, you can switch energy suppliers through the selected price comparison website OR by calling the supplier directly. Some tariffs are exclusive to price comparison sites, though, so be careful not to be switched to something else, as energy supplier agents are paid a commission to switch you over the phone.

Ultimately, it's your call, but hopefully, this quick guide has conveyed our thoughts and opinions in a clear and useful way. As always, we're open to feedback and welcome readers to reach out to us and help us improve the advice we provide.