Wholesale price increases driving up the cost of fixed energy deals
New analysis from uSwitch.com has revealed that the price of fixed energy deals has continued to increase over the summer, some as much as £219. 21 energy suppliers have replaced their cheapest fixed price deals with a more expensive offering, since June.
The largest increase highlighted was by Co-Operative energy whose “Co-Op Fix for Longer September 2017” tariff costing £770 launched at the start of June. Since its launch it has been replaced twice, mostly lately by “Co-Op Online October 2017” now costing £989.
The price of energy deals is directly linked to the wholesale cost of energy. The price reporting agency ICIS has said that the price has increased rapidly over recent years. Reasons for this include; the falling value of sterling following the EU referendum, future energy supplies concern, higher transmission costs and temporary closure of the Rough gas storage facility.
There are still deals available. First Utility and Npower have both made price reductions since the beginning of August. The best value fixed deal is Avro Energy’s “Simple and Select” which currently costs £770 per year. This is £292 less than the average deal offered by the big six companies.
Claire Osborne, uSwitch.com energy expert, said:
“Many suppliers are increasing the price of their cheapest energy deals amid concerns about rising wholesale energy costs and uncertainty in the market following the EU referendum. It remains to be seen whether this is just a blip – and wholesale prices still remain well below their high levels in 2013.”
“The good news for consumers is that, despite these rises, the market’s most competitive plans are still hundreds of pounds less than the average big six standard tariff. Those who are concerned about their energy bills going up, especially as we head towards the autumn, should look around to see whether they can switch to a better tariff and consider fixed deals that can provide protection against further potential price rises.”