Hidden costs of fixed energy tariffs

08/03/2010

Many households have opted to take up fixed-price energy deals in response to sharp increases in domestic fuels bills in recent months.

But one consumer website is claiming that some of these deals are bad value for money, because of the charges the energy companies demand for getting out of them.

Energyhelpline.com claims that some households could be losing as much as £500 a year because they are trapped by high tariffs they cannot get out of.

High energy prices in recent years have been a leading reason for debt, and a major contributor to many families' financial problems.

Fixed tariffs are supposed to help by giving certainty about costs, but many are set above the market price – and don't fall back when prices fall, leaving some of the most vulnerable customers paying more than they could be, and facing big charges if they want to switch supplier.

Vance Parsons, director of EuroDebt, says they would recommend that "every household that hasn't switched their energy supply check on www.energyswitching.co.uk to determine whether they are on the best tariff for them. The service is free and switching only takes 5 minutes."

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