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Thinking of switching from variable to 12mth fixed term tariff...


Thinking of switching from my variable tariff to the new 12mth fixed term tariff but have a question about how it would work if my usage is either less or more than the projected usage used to calculate the initial fixed term tariff monthly direct debits.  Will my DD be reviewed and changed at 6mths as my variable tariff is.  Will I end up with credit less at the end or more worryingly debt at the end of the term?   Or is it all water under the bridge either way and I will either be lucky or unlucky! I am only 6 months into having a new boiler fitted so my usage is slightly unknown to me and I am well aware that a really cold winter can really push up your gas heating bill.  I cannot find anywhere that clearly explains how this will all work and would just like some clarification.  Many thanks.

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Best answer by stephenrand 3 July 2020, 14:33

Hi Janice

I'm just another customer, so I can't give a definitive answer, but when I switched my assumption was that it would work exactly the same. I'm sure your direct debit will be reviewed, and when your year comes to an end and you have to choose a new tariff, your balance will just carry over.

I'm just wondering if behind your question there is a thought that might be answered by this fact: you will only pay for the energy you use at the price stated in the tariff. Your direct debit may have to be varied to achieve that over the course of the year, but the price doesn't change.

Does that help?

Stephen

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Userlevel 7
Badge +9

Hi Janice

I'm just another customer, so I can't give a definitive answer, but when I switched my assumption was that it would work exactly the same. I'm sure your direct debit will be reviewed, and when your year comes to an end and you have to choose a new tariff, your balance will just carry over.

I'm just wondering if behind your question there is a thought that might be answered by this fact: you will only pay for the energy you use at the price stated in the tariff. Your direct debit may have to be varied to achieve that over the course of the year, but the price doesn't change.

Does that help?

Stephen

Userlevel 7
Badge +8

Took the words right out of my mouth Stephen 👍👍👍👏👏👏👏

So the UNIT price remains concrete, Janice, but if you’re using more / less than originally thought, your DD may increase / decrease after the six month review. 

Thanks, that makes perfect sense.  It was what I was assuming instinctively but your thought process makes my assumption feel correct but with more basis to it!  Thanks for your help.

 

Janice

Any thanks Bev.

 

Janice

 

I meant “and thanks Bev” obviously!

 

Userlevel 7
Badge +10

Thinking of switching from my variable tariff to the new 12mth fixed term tariff but have a question about how it would work if my usage is either less or more than the projected usage used to calculate the initial fixed term tariff monthly direct debits.  Will my DD be reviewed and changed at 6mths as my variable tariff is.  Will I end up with credit less at the end or more worryingly debt at the end of the term?   Or is it all water under the bridge either way and I will either be lucky or unlucky! I am only 6 months into having a new boiler fitted so my usage is slightly unknown to me and I am well aware that a really cold winter can really push up your gas heating bill.  I cannot find anywhere that clearly explains how this will all work and would just like some clarification.  Many thanks.

hi Janice, I’m going to answer this in a slightly different way.

The prices for energy on the fixed tariff are cheaper than the variable tariff, so in every circumstance (apart from one which I’ll come to in a moment) the fixed tariff will always cost you less for using the same amount of energy. It’s as simple as that. Everything else remains the same although you may be able to slightly reduce your dd from what it is now.

The only circumstance where it might cost more is if you switch away earlier than 315 days after you started and thus have to pay the £30 per fuel penalty.

I know the other answers were really good, I only posted this because it was a simpler way to look at the question.

Badge +2

But, of course, the variable tarrif prices can decrease too. I’m not sure what the last decrease was and whether the chance of that happening outweighs a move to fixed.

Userlevel 7
Badge +9

In the end after scratching my dome I went for the fixed saving £61.00. I thought even if the variable went down I doubt that it would be below my current fixed saving. If I use more energy on fixed then £61 should cover it. Of course there could be other permutations.  

Userlevel 7
Badge +8

I would save twelve notes if switched to fixed, so thought I’d stay on variable for now, with no exit fees. 

And you never know, a more tempting tariff might come along… 😁

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