Energy bills could jump 15% and the first hike may be in DECEMBER – should you switch to a fixed tariff now?

ENERGY bills could go up by as much as 15 per cent due to rising wholesale costs, an economist has warned.

Wholesale costs for gas and electricity have jumped by 20 per cent and 50 per cent, since the summer.

These costs are being driven up by the weaker pound and it may in turn force suppliers to raise prices for customers.

Samuel Tombs, chief UK economist at Pentheon Macroeconomics, predicted that bills will go up by five per cent in the short term and 15 per cent over a longer period.

He told the Daily Express: “We assume price rises will take effect in December, as they did in 2012 and 2013, although the risks are tilted to a later hikes, given that suppliers usually announce changes a month or so in

"We therefore expect the Big Six suppliers to raise prices by about five per cent this winter, and by a further five per cent next winter."

So far, none of the “big six” energy firms - E.on, EDF Energy, British Gas, nPower, SSE and Scottish Power - have announced price increases.

However, a number of smaller suppliers have started to increase costs. Last week, GB Energy Supply announced it is raising the cost of its standard dual fuel variable tariff by 30 per cent.

In August, OVO Energy announced a 3.6 per cent increase and Co-operative Energy put up prices by three per cent in October.

Claire Osborne, uSwitch.com energy expert, said: "Wholesale costs have been steadily rising since the spring, meaning several suppliers have upped the price of their best deals.

"For the moment at least, there are competitive tariffs available on the market - however they could become more expensive if wholesale prices continue rising.

"Consumers concerned about energy bills going up this winter should shop around and consider fixed deals which provide protection against potential price rises."

Should you fix your energy bills now?

Fixing your energy bill is a gamble - if prices go up then you’ll get a good deal by guaranteeing the rate you pay.

However, if prices go down then you might end up paying more and you’ll have to pay a penalty to leave.

Ben Wilson, from Gocompare.com Energy said; “The energy market is particularly competitive at the moment with a range of fixed deals on offer, many costing less than £800 a year, for households to take advantage of.

“By choosing a fixed tariff, not only do you get the reassurance that the amount you pay for your energy units won’t rise for the duration of your deal, but in the vast majority of cases you could make significant savings when compared to a standard variable tariff.”

The average variable tariff offered by a “big six” supplier is £1062 - which is £318 more than the cheapest on the market, according to uSwitch.com.

It is important to remember that some fixed tariffs come with penalty fees if you leave before the end of your contract. You’ll need to factor this into your decision.

How to get a cheaper gas and electricity deal

The actual cost of your energy bill will vary based on your postcode and usage, this means getting online and doing your own tailored search through a comparison site is the most accurate way of finding the best deal for you.

If you've never switched before - or are on a standard tariffs - then you could save as much as £400 off your annual bill. If you switch regularly, then the savings are usually smaller - around £50 a year.

If you don't switch when you reach the end of a fixed deal then your costs could double.

Sites such as, uSwitch.com, GoCompare.com or Energyhelpline.com are a good place to start. You’ll need a recent bill and details about who supplies your energy to get an accurate comparison.

We also have information on how you can get help with your energy bills this winter if you're struggling to pay them.

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