USwitch has discovered that a number of energy companies have pulled their dual fuel deals and replaced them with more expensive options, since the result of the EU Referendum.
Just what is going on in the energy market in Brexit Britain?
There does indeed seem to be a rowing back from fixed-rate dual-fuel tariffs, with twelve energy providers withdrawing their great dual-fuel deals and replacing them with higher tariff offerings. And yes, this is since the result of the EU referendum.
This is due to the fall in the value of the pound, which has pushed up the cost of wholesale energy imports. Customers are footing the bill and it could see an increase of up to £105 per year for the average user. Wholesale prices have been moving upward for the last three months, so it was perhaps inevitable that this move would occur.
For the last three years, wholesale electricity and gas prices have been falling, leading to some great savings for consumers. With market uncertainty post-Brexit, however, the low cost energy party could well be at an end.
Scottish Power, EDF and British Gas were some of the first companies to re-price. One of the increasingly popular smaller energy suppliers Extra Energy, caused the greatest surprise, however, with a whopping hike in costs. They replaced their attractive Fresh Fixed Price October 2017 deal, which cost consumers around £770 per annun, with a new deal fixed until August, which costs £875 for an average user – an eye-watering price hike.
VAT cut on Fuel?
With claim and counterclaim flying around during the EU referendum campaign, there was mention by the Leave camp of scrapping VAT on fuel to address the issue of fuel price hikes.
Nothing of the sort has been floated by Government yet and it remains to be seen whether it will happen. But even with VAT in place it still pays to shop around for fuel deals. There are still good packages to be found, but don’t expect them to be around for long. The pound is slow to recover, and miracles are not to be expected in the current climate of uncertainty.
USwitch note that some energy deals have fallen, but even at the lower rate they remain more expensive that other deals. Utilita’s Premium Energy is one example.
But they do encourage buyers to look carefully for deals. First Utility, for example, have just launched a three year deal, with a typical yearly cost of £999 per year. Longer term fixed deals seem to be appearing, alongside the typical one year fixed term deals. Consumers may just have to buy clever and shop around a little more to make their post-Brexit energy budget stretch.