BILL BOOST
Martin Lewis explains how to stop your energy bill rising next week – and what will happen to prices in 2025
Find out how to get help with energy bills below
MARTIN Lewis has revealed how you can stop your energy bills from rising next week and whether they will go up or down in 2025.
The consumer champion featured as a co-host on ITV's Good Morning Britain yesterday morning.
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And the MoneySavingExpert.com website founder used his platform to reveal how households can save money on their energy bills from October 1 when they are set to rise.
A new price cap will see the average bill rise for around 28million households to £1,717 from £1,568 a year - an increase of 10%, or £149.
It's worth bearing in mind this is based on the typical household on a dual-fuel standard variable rate (SVR) and you might pay more or less than £1,717 a year from next week based on your usage.
Martin said you can beat this hike by locking in a fixed-rate energy deal which is lower than the October price cap.
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A fix is when you lock in a set price for a certain period which is usually 12 months.
That's different to an SVR which can go up or down depending on Ofgem's price cap, which changes every three months.
Responding to a viewer question on whether they should lock in a fixed tariff with Octopus Energy for 15 months on GMB yesterday, Martin replied that it could save them money currently.
He explained this is because wholesale energy costs have fallen since the price cap was set in August.
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Though the price cap is based on wholesale prices, there is a lag from when it is decided to when it comes in to effect.
As wholesale prices have fallen further since August it means suppliers can offer deals now that are less than the new price cap and there are a flurry of new deals that have now hit the market that Martin says are now worth considering.
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Martin said: "Bizarrely, energy prices are going up if you're on the price cap, but the cheapest rates available if you are going to switch (and fix) are coming down."
The consumer champion said based on current predictions for what the price cap will be in January and April next year, fixing now at a lower rate could save you money into 2025 as well.
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The consumer champion said while energy bills are expected to rise by around 10% from next week, they will then fall by 2% in January then a further 1% in April, based on predictions from EDF.
But some of the cheapest deals on the market right now are up to 9.4% cheaper than the October price cap.
So, lock in now, and you could save money on your bills between October and next June.
However, it's worth bearing in mind predictions are just that, and aren't guaranteed.
But Martin said if you are "risk averse", locking in a fixed-rate deal now could be worth your while.
One major perk to a fixed energy deal is that you know what you will pay over an extended period which gives you more certainty.
But, it can see you end up paying more overall than being on a SVR if wholesale energy costs fall and the price cap comes down.
Fixed-rate deals also come with exit fees if you want to come out of the deal earlier than the agreed period.
Below are the current best fixed deals on the market, though remember that deals can launch or be pulled at any time.
Some suppliers also offer deals directly to customers, rather than them being open to anyone.
The way to get the best energy deals in most cases is by using a price comparison website like MoneySuperMarket and Compare the Market.
This will display tariffs in price order so you can compare what you are paying now to what you could pay.
Bear in mind though, some energy deals are exclusive to one price comparison site while others are only viewable by going to a supplier's website direct.
How to get help with energy bills
Locking in a fixed-rate energy deal ahead of prices rising next week is one way to cut the cost of energy.
There is a host of help on offer to cover costs over the colder months, including the Winter Fuel Payment and Warm Home Discount.
Both schemes are means-tested though, which means you will have to be on certain benefits to qualify.
But, in total, they are worth up to £450 which could massively help.
If you are struggling to cover the cost of your energy bills or have fallen into arrears, you might be able to get a free grant.
British Gas, ScottishPower, EDF and Utilita all have schemes offering customers up to £2,000.
You also might be eligible for help with energy bills via the Household Support Fund (HSF) which is worth £421million.
The new round will run from October until March next year, but many councils are yet to announce what type of help will be on offer.
However, in previous rounds, local authorities have given households in need energy vouchers, supermarket vouchers and free cash.
Contact your local council, which you can find using the Government's online council locator tool, to find out what help is on offer.
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It's worth checking if your energy firm has any targeted support on offer based on your circumstances too.
For example, Octopus Energy is handing out 20,000 electric blankets to customers in need this winter.
When does the price cap change?
OFGEM reviews the cap on unit rates for those on the default tariff every three months.
This means the energy price cap can move up or down at four different points in the year.
Price cap rates are updated on the following dates:
- January 1
- April 1
- July 1
- October 1
Do you have a money problem that needs sorting? Get in touch by emailing [email protected].
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