Energy price rises are always in the news announcing price hikes. Many businesses who feel they already pay over the odds for their gas and electricity will be concerned at the idea of paying even more. However, there are still ways to protect yourself from the rises.
The best course of advice is to grab a fixed price tariff. A fixed tariff guarantees your rates won’t increase during a set period of time, protecting you from any market increases during the period. Most suppliers offer a range of fixed term deals at the moment, with some extending for periods as long as three years or more.
The question is should you opt for a long-term fixed deal or a short-term option? For those of you that want to see the greatest savings immediately there is no debate, a short-term fixed deal is the better option. The cheapest fixes available are generally over a 1 year period, which would provide quick savings but would leave you exposed to inflated prices once they expire.
However, with prices predicted to rise year-on-year, the long-term fixed tariff could see considerable savings for consumers who wish to protect themselves long-term.
Or go long?
The current long-term fixed tariffs range from typically 2 to 4 years and sometimes longer. While you will be seeing a modest saving on an average bill in year one, in year two you will potentially be seeing much larger saving against market pricing. In year three the savings could be 10% plus. As you can see, the incremental savings derived from choosing such a long-term tariff could be substantial.
The important advice to remember, in a constantly fluctuating energy market, is that a fixed tariff is the safe and prudent way to go. Businesses looking to insulate themselves from future price rises should look to fix as soon as possible.