[Ted551]

Don't know wether this has already been asked but with the price cap set at £1971 why is the best tariff I can get set at £2111?

[theunknowntech]

Hiya!

Fixed rate tariffs are not affected by the Ofgem Default Tariff Cap so suppliers can charge whatever they wish for them because you're making an informed decision. The price cap only applies to tariffs where you had no say in what you were placed on.

The national average price cap does not apply to all areas of the country either. If you're in a more expensive area, the price cap will be higher to account for it.

[Ted551]

I'm on a variable rate on next flex and eon website says price cap only affects those on variable rates.
very confusing message from eon

[meldrewreborn]

The price cap figure published by OFGEM assumes a certain level of gas and electricity consumption. - so an average customer living in an average area paying by Direct debit. Reality is somewhat different. This is just a convenient guide to what people might pay, and in particular is useful for working out an average increase, which this time is 54%!

[meldrewreborn]

@Ted551

It used to be that many customers would have a fixed rate deal that was significantly cheaper than the standard variable rates that suppliers provided. In reality at the time these were the most expensive tariffs they offered. The Government and OFGEM then introduced the price cap to prevent the suppliers from overcharging people on the standard variable rates by introducing the the price cap - which applied only to those variable tariffs. Each price cap ran for 6 months and there were 7 before the latest one that started on April 1.

The difference is now that fixed rates (because they are not price capped, run for longer periods and reflect a future rise in wholesale prices)) seem to many to be very expensive. The price caps currently are protecting the vast majority of customers from even higher prices. This is because the data on which the price cap is based is backward rather than forward looking. Wholesale prices have continued to fluctuate and mainly rise since the last sampling period (end Feb) which is why "experts" are predicting that prices will rise even further in the next price cap period. Its also possible that the next cap will apply for a shorter period because of the rapid changes in wholesale prices.

I hope this helps.