Over the past three years energy tariffs on the cheap end of the market have been fixed. By that I don’t mean that the suppliers have been engaging in price-fixing, although some cynics may think that to be the case, what we are talking about our fixed term deals where the prices stay locked for a set period of time.
Fixed deals are great for the consumer, protecting them against rates that would often fluctuate up and rarely the other way. The fixed tariff would mean a customer could predict what their spend would be on energy for the duration for the duration of their contract.
New supplier GB Energy has reversed this trend by launching their Premium Energy Saver tariff, which becomes the first variable rate energy plan to top the cheap gas and electricity tariff list for years. The question is, does this mark a change in the approach taken by other suppliers? Will they abandon the cheap fixed tariff model and head towards discounted variable deals that will enable them to compete with GB Energy?
At the moment, it seems unlikely that this will happen. Consumers have become accustomed to fixed deals and they are popular precisely because of the guaranteed rates. It is worth keeping an eye on though, and we will be bringing you news of any developments on the return of the variable rate tariff as it could greatly impact the way we choose our energy provider.