Don’t change energy supplier even if they are in trouble… it could cost you £700
FAMILIES are being warned of a £700 rise in bills if they change energy suppliers.
Normally, households are urged to switch regularly since providers typically offer the best deals to lure new customers.
But soaring wholesale gas prices — up six-fold this year — have turned that advice on its head.
Comparison sites have stopped offering energy switch deals, as even the best is hundreds of pounds higher than sticking with an existing supplier.
MoneySavingExpert.com founder Martin Lewis said: “We are in an extreme energy bill crisis.
“The logic of how to manage bills has been turned on its head.
“The right move for most people right now is to do nothing — don’t switch.”
On comparison sites yesterday, dozens of deals were priced at or above £2,000 — £700 or more than the typical bill of £1,277 a year.
It is a sign suppliers are pricing themselves out of the market as they do not want new customers while gas prices are so volatile, experts say.
Those staying with their supplier will automatically switch to a default standard variable tariff — which is covered by Ofgem’s price cap.
However, the cap will go up sharply in April to ease pressure on suppliers.
Compare the Market’s Alex Hasty said: “People should keep an active watch on the cap.”
Q&A: WHAT YOU SHOULD DO
Q. DOES the advice about not switching change if my current supplier goes bust?
A. THE advice is the same. Ofgem will make sure the move to a new supplier is smooth and you can keep credit you have.
Q. WHEN is the energy cap next reviewed?
A. Normally every six months, with the next figure to be set in February and to take effect in April.
Q. WHAT will happen?
A. EXPERTS say it will go up by £200 to £350 a year for the typical user, which will take it to around £1,500 to £1,650.
Q. WHEN will it be worth switching again?
A. CHANCES are energy firms will hike prices up to the new price cap. If wholesale prices drop after that, it is likely firms will offer cheaper deals.
Q. ARE energy suppliers playing fair?
A. WHERE suppliers are being naughty is offering expensive deals and hoping families switch.