Customers face even bigger bills as energy companies struggle to stay afloat thanks to rising gas prices.
The cheapest deals have disappeared and some price comparison websites are warning that they can’t save you money.
On 1 October, the price cap on out-of-contract energy deals rose to its highest-ever level. But it came too late for some suppliers: 12 have stopped trading in the last two months.
Plus there are fears that more energy firms will close in the near future.
Amidst all of this, it’s worth checking whether your tariff will protect you from further price rises this winter and know what to do if the worst happens to your supplier.
Though some energy price comparison websites closed their doors to customers, Which? Switch is still up and running. Use it to compare gas and electricity prices to check you’re on the best deal for you.
Why are energy prices so high?
Gas prices have risen 250% since January and 70% since August, according to industry group Oil and Gas UK.
High demand for liquefied natural gas from Asia has pushed up prices, along with a cold winter leaving gas reserves lower than usual, and less supply coming from other countries.
Gas is used to generate some of our electricity and electricity prices are rising too. Less wind means that less renewable electricity is being generated. There have been outages at some nuclear power stations too.
Should I switch energy company or stay put?
Usually we’d advise you to compare gas and electricity prices and switch supplier or tariff to get the best deal.
But these aren’t normal times. You’re unlikely to find a cheap deal at the moment and switching isn’t the right option for many people right now.
But it’s still important to look closely at your current deal and check whether it’s still the best option for you.
If you’re on an out-of-contract energy tariff, (also called default or standard variable), your prices probably rose on 1st October. This is because the energy price cap increased and many suppliers raised the prices of these tariffs to the maximum permitted. If your price increased, your energy supplier should have told you.
Price-capped tariffs are now the cheapest deals sold by some suppliers. However, the prices of these are likely to increase again in six months when Ofgem reviews the price cap.
A fixed deal will give you price security – the rates you pay per unit of gas and electricity are set for the length of your contract which is often for 12 or 24 months. However you may have to pay a premium for price security because many fixed deals currently cost more than the cap.
If you’re already on a fixed deal, you’re already protected. If it’s cheap, don’t switch away from it early.
How to compare gas and electricity prices
Use Which? Switch to see all energy tariffs on sale at the moment. Unlike other price comparison websites, it shows all available deals upfront, even if we can’t switch you to them.
It will help you check whether you’re on the best deal for you, or whether there’s a better option. You might have to contact the supplier directly if you find a good deal.
Always compare prices using your usage from the last year (in kilowatt hours). This makes sure you get as accurate a quote as possible. Estimate it and you risk seeing bigger (or smaller) savings than the reality).
Follow our step-by-step guide to switching energy supplier.
Will my energy supplier go bust?
Avro Energy, Colorado Energy, Enstroga, Daligas, Green, Igloo Energy, MoneyPlus Energy, People’s Energy, PFP Energy, Pure Planet, Symbio Energy and Utility Point have all stopped trading this month and there are fears that more will follow suit.
Their 1.9million customers combined have seen their gas and electricity supplies continue as usual.
Energy regulator Ofgem chooses a new supplier to take on their customers. The new supplier will honour any credit you have and you’ll be moved across to it within a few weeks. You’re then able to switch to another supplier, if you’d prefer.
If your supplier closes:
- take a meter reading
- don’t switch
- wait for a new supplier to be chosen by Ofgem
- wait for the new supplier to contact you.
Find out more about what happens when your energy company stops trading. Also see our latest update on failed energy firms.
Which? comment on energy prices
Adam French, Which? Consumer Rights Expert, said: ‘with so many energy providers going bust and cheap deals disappearing in droves from price comparison sites over the past couple of months, many people will be confused and concerned about their energy bills as the price cap hits a record high and winter approaches.
‘Although it may be too late to switch before the price cap rises, it’s still worth shopping around to see how your current tariff compares. If you’re looking for price security then a pricier fixed tariff may still be worth considering to guard against future increases.
‘If you are concerned about struggling to pay higher bills, there is help available. Speak to your energy provider about a payment plan you can afford and check to see if you qualify for any government schemes, such as the Warm Home Discount or Cold Weather Payment.’