Martin Lewis has issued an energy bill warning to “80 per cent” of UK households. The BBC and ITV star has shared how eight in 10 of homes are overpaying on their energy bills as he shared a simple way to get cheaper prices.
The Money Saving Expert founder says those on price-capped tariffs are overpaying and the 52-year-old explained who could be worst-hit. “This is all about: are you on a price-capped tariff? If so, you are overpaying and you will continue to do so,” he said.
“‘You’re not on the price cap if you’re on a fixed currently or if you have actively chosen a specialist tariff that you are on,” said the expert. “You are on a price-capped tariff if like 80 per cent of homes – most of you – you’re on a firm’s standard tariff, so you haven’t switched in years or you were on a fix or a specialist tariff and it ended and you came off it and you did nothing.
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“‘If you’re not sure, you’re most certainly on the standard tariff.” He added: “Now the energy price cap rose one per cent a couple of weeks ago on the 1st of January. That’s on top of the 10 per cent rise in October.
“Almost all firms – it’s called a cap, it’s really a lock in – they charge the maximum or very near the maximum. And if you’re on a price capped tariff you’re paying the rates that Ofgem sets for you to pay. State of the nation: prices dropped last winter, they came down again, they bottomed out in July and then they went up in October, then they went up again and the current price cap – it changes every three months – it lasts until April.
“It would be very unlikely for it to be dropping substantially in July.” He added: “A fix gives you peace of mind that you lock in a set rate. The cheapest fixes now are five per cent under the current price cap. So if it goes up 5 per cent in April, they’re ten per cent cheaper than the prospective April price cap.
“And you are locked in for 12 to 18 months with no price rises, giving you peace of mind – you’ll know what you pay.”