EDF has launched the cheapest, energy-only 12-month fixed tariff among major suppliers, some £130 lower than January’s price cap. Ofgem announced on Friday that household energy bills will rise slightly by 1.2 per cent from New Year’s Day.
The sector regulator confirmed that annual energy bills for millions of households on the standard tariff, with typical average usage, will rise from £1,717 to £1,738 from January 1 – an increase of £21 over the coming year (£1.75 per month). To help customers beat the increase, EDF has introduced ‘Simply Fixed Direct 1y Jan26’ which costs £1,608 for a typical average energy user paying by Direct Debit – a smart meter is not required to sign up.
There are no exit fees for Simply Fixed Direct 1Yr Nov25 V5 if the customer signs up directly through EDF, however the deal could be removed at any time due to volatility in global wholesale prices.
Typically, energy prices do increase at this time of year when demand is higher. However, there has been more wholesale market volatility in recent weeks due to the cold weather as well as concerns over gas supplies from Russia. Instability caused by conflicts in the Middle East and between Russia and Ukraine, as well as the uncertainty the American election brings to global gas prices are also factors in the predicted uptick.
EDF recently launched its ‘Sunday Saver’ offer giving customers who sign up and reduce peak energy use up to 16 hours of free electricity a week. Customers who sign up for December’s challenge will get eight hours of free electricity on Christmas Day.
Rich Hughes, Director of Retail at EDF, said: “With cold weather setting in and the price cap set to increase again, we know people are more concerned about the cost of their energy bill. Just like we have all year, we will keep our prices as low as possible, so we can help and offer again the cheapest priced energy only fixed deal of the major suppliers.”
EDF is also offering a 12-month tracker tariff, which tracks at £50 below the price cap, with that £25 per fuel saving coming from standing charges rather than unit, ensuring that those who sign up will see the same financial benefit even if they are low energy consumers or on a Pay As You Go meter.
Existing customers can sign up to the new tariffs in MyAccount or in the EDF with new customers able to join via the website.
Recent analysis by Ofgem shows around 1.5 million households switched tariff over the past three months. Following the price cap announcement, the regulator urged customers to take advantage of the rising choice in the market and look for the best deal to help keep their household bills down.
Following a call by Ofgem in August for suppliers to offer more choice with low and no-standing charge tariffs, there has been an increase in the number of suppliers offering these kinds of deals. There are currently 8 available that are at least 10 per cent below the level set in the price cap.
However, while these come with a lower standing charge, they do have a higher unit rate. They could benefit customers with lower energy usage but will not work for everyone so consumers should carefully consider what works for them.
Tim Jarvis, director general of markets at Ofgem, said: “While today’s change means the cap has remained relatively stable, we understand that the cost of energy remains a challenge for too many households. However, with more tariffs coming into the market, there are ways for customers to bring their bill down so please shop around and look at all the options.”
It also encouraged anyone struggling with bills to speak to their supplier to make sure they’re getting the help they need and look around to make sure they’re on the best, most affordable deal for them.
The regulator is also encouraging customers to consider the way they pay their bills. It said around 5 million people pay by standard credit payments – which means paying for energy after it has been used, which is much more expensive, particularly over the winter months.
Customers could save £100 by simply switching from standard credit payments to Direct Debit payments or smart prepayment meter, which remains the cheapest way to pay for energy.