According to Martin Lewis, 80% of households in England, Scotland and Wales currently overpay for energy — and in the coming months, it’s only going to get worse.
Ofgem just announced the price cap will be going up by 6.4% in April – following a 1% rise in January – with the energy regulator blaming an increase in the wholesale price of oil and gas.
That means the minimum bill for someone with typical dual-fuel use paying by Direct Debit will go up by over £100 a year, which Ofgem chief executive Jonathan Brearley will pose ‘a huge challenge for many households.’
But thankfully, there is a way to avoid the worst of the hike, with Martin claiming it could result in a typical annual saving of £200.
And the personal finance guru’s advice is simple: ‘Most people should consider locking in a cheap fix to avoid the hike.’
On the Money Saving Expert (MSE) newsletter, he explained that ‘a fixed tariff is where you lock in a rate for a set time (you still pay more if you use more, though), giving you the peace of mind of price certainty’.
Martin also added on X: ‘The cheapest year-long standalone fixes right now are about 4% less than the current cap, never mind once it rises in April.’
As many people are nervous about switching to a relatively unknown energy company for their price fix, Money Saving Expert has managed to wrangle an exclusive 16-month fix with British Gas, that’s available for new and existing customers.
However, it’s only available until 5pm on Friday, March 28. So you’ll want to act ‘urgently’ if you want to snap it up as there are just three days from now until then.
According to the experts, there’s only one smaller firm (Outfox the Market) that has a cheaper deal right now, and this is the ‘most competitive deal’ British Gas has offered in a while.
Martin says that in general the deal ‘looks strong’ but the exact fixed rate tariff that’s best for you will depend on your region and how much energy you use.
To find this out, you’ll want to put your details into a comparison tool (like MSE’s Cheap Energy Club) to see more personalised options.
Regardless of which deal you choose, the new price cap will come into play on April 1 and will last for three months, so you definitely have to switch before then.
However, Martin also warns that deals are being snapped up fast, so ‘getting it done ASAP is safest’ as ‘each day you sit on the Price Cap is a day you pay more than needed’.
Popular price capped tariffs
If you’re on one of the following, what you pay is determined by the price cap, which Martin says means you’re ‘likely overpaying and should sort now’.
- British Gas Standard Variable
- EDF Standard (Variable)
- E.on Next Next Flex
- Octopus Flexible Octopus
- Ovo Simpler Energy
- Scottish Power Standard
Alongside fixed rate tariffs, it’s worth looking into specialist alternatives that could save you cash.
EDF’s new Simply Tracker Extra tariff, for example, slashes £100 a year off the standing charge, and could be good for those with lower usage (roughly under £135 per month).
Alternatively, there are electric vehicle tariffs which could help EV drivers keep costs down, and rapid price-change options offering lower prices outside of peak periods for those who are able to shift their daily usage routine.
If you’re still struggling to pay, Martin recommends speaking to your energy provider to see how they can help.
‘Be polite and straight with it, and make sure you explain if you’re vulnerable,’ he says.
They may be able to put you forward for a hardship and debt grant, or work with you to negotiate a payment plan you can afford – everything’s decided on a case-by-case basis.
Under Ofgem rules, suppliers are obligated to help struggling customers, so get in touch with yours as soon as possible if you’re worried about your ability to pay.
How can I lower my energy bills?
Amy Knight, personal finance expert at the financial comparison website NerdWallet UK, told Metro: ‘While cutting down on energy use can help save money on bills, this isn’t always an option. Instead, focus on getting more value from the money you spend heating your home.’
Here are her top tips to keep fuel bills low this winter:
Ask for a refund if you’re overpaying into your energy bill by direct debit
If you’re several hundreds or even thousands in credit, your direct debit is probably set too high.
You can ask for a refund of most of the balance and adjust your direct debit to be lower. Be aware though, it is normal to be in credit this time of year because most households use less energy in the summer versus the winter when we have the heating on.
How hot do you need your water?
Heating water uses a lot of energy, so you can turn down the flow temperature of your boiler to shave a little off your bills.
As long as the water from your hot tap is comfortable to have a bath in, you don’t need to set it any hotter. You can do this manually or you may be able to ask a heating engineer to fit a device called a ‘weather compensator’.
Remember where warm air comes from
Keep radiators uncovered to maximise the benefit when they’re on. If you have long curtains covering your radiators, leave them open to make sure the warm air circulates into the room, not out of the window.
Look at the label
When shopping for a new appliance such as a washing machine or fridge, look at the efficiency ratings. If your budget can stretch to A or B-rated white goods, these can help lower your energy usage long term.
A version of this story was first published on February 25, 2025.
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