Why you need to lock into a record low energy deal amid warnings of a 10% price hike next year
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HOUSEHOLDS should lock into record-low energy deals now amid warnings that bills could rise by as much as 10 per cent early next year.
A 30 per cent drop in wholesale costs over the past year has sparked a price war among suppliers, driving down the cost to bill payers.
Today, there are 15 deals for under £900 a year for gas and electricity compared to the start of the year when there was only one, according to switching service energyhelpline.
Experts are warning that now might be the best time to fix into a cheap rate before the winter months when bills typically rise by 10 per cent as temperatures drop.
The best rates are still being offered by smaller providers, with the biggest savings to be had by those who currently pay for a standard variable tariff.
The Ofgem cap is currently set at £1,179 a year but these types of deals typically charge customers higher rates.
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For example, you can save £344 a year by locking into a deal with Utility Point that costs £835 for gas and electricity, while a deal from People's Energy will also save you £343 a year.
Other small providers including Outfox the Market, Green and Avro Energy also feature in the top 15 cheapest deals.
More than 5million customers have switched energy suppliers so far in 2019, according to Energy UK, 32 per cent of which we from a large firm to a smaller one.
Some bill payers may be wary of switching to a lesser known supplier considering that since June, five have failed.
Toto Energy, Solarplicity, Cardiff Energy Supply, Eversmart Energy and Uttily Energy all went into administration over summer, affecting millions of customers.
But households aren't cut off if their suppliers goes bust as the regulator Ofgem will move them, and any outstanding credit, to a new one as soon as possible.
Is it safe to switch to a small energy provider?
FED-UP with sky high energy prices and poor customer service from the Big Six energy firms? Then you could save a packet by switching to a smaller firm.
Research from Which? has found customers with smaller and medium sized firms like Utility Warehouse, Flow Energy and Octopus Energy are much happier than those with the major firms - and could save a whopping £333 a year by switching.
The biggest risk of choosing a smaller provider - like Toto Energy - is that it goes bust.
But remember that if the firm does go under you won't be cut off, and Ofgem will try and get a new supplier in place as quickly as it can.
Once it has done this, the new firm will contact you - it doesn't have to honour the deal you were on with defunct firm - but under Ofgem rules any credit you have on your account is protected.
If you're unhappy with the new supplier's offer you are free to shop around for a new deal and switch - you won't have to pay any exit fees to leave.
The Big Six energy suppliers - British Gas, EDF Energy, E.ON, Npower, Scottish Power and SSE - are also starting to lower rates in a bid to win back customers.
In January, the best deal offered by one of these companies stood at £1,051 a year with E.ON, but now the cheapest is £908 a year with EDF.
Mark Todd, of energyhelpline, explained: "This battle [for customers] is increasingly becoming a fight to the death, as many suppliers have been folding or exiting the market in recent years.
"Normally energy prices rise over the winter months, so now is a great time to lock in a low price."
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Temperatures across the UK are set to "plunge to -10" this month with a freezing fog expected to engulf Britain.
And if the weather is anything like in the previous two years, more snow and ice cold be on the way in the New Year.
Audrey Gallacher from Energy UK added: "With the temperatures dropping across the country, I’d encourage consumers to get in touch with their supplier or have a look online to make sure they’re on the best deal ahead of winter and the cold weather."