Martin Lewis has issued E.on customers with an urgent piece of advice ahead of a huge energy bill hike expected across the UK this year.
The MoneySavingExpert founder has warned that some households signed up to E.ob by direct debit are being offered two very different fixed tariff deals.
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The Mirror reports that these two are being described by Martin as a “definite winner” for those who want price certainty in the middle of the cost of living crisis.
The first tariff being flagged is the E.on Next Online V11 one-year fix, which Martin pointed out is the same rate as the April 2022 price cap.
Ofgem has announced it is hiking its energy price cap - which limits the rates a supplier can charge for each unit of gas and electricity you use - by £693 from £1,277 to £1,971.
If you’ve been offered this rate as an E.on customer, Martin said you should “bite its hand off and take it” as energy prices are anticipated to go up again later this year. Ofgem will review its price cap in October 2022.
Writing on Twitter, he said: “IMPORTANT PLS SHARE: E.on and E.on Next Direct Debit customer on the price cap?
“Log in today & see if ur offered NEXT ONLINE V11 1yr fix. It should be SAME rate as the April price cap (ie 54%ish more than now - check). If so, as cap likely to rise another 24+% in October it's a corker.”
This tariff is being offered to some existing customers of E.on.
Of course, if prices fell within the year, you could end up paying more if you stayed on to fixed rate - but experts think this is very unlikely. Some customers also replied to Martin saying the deal has no exit fee.E.on customers are also reportedly being offered a slightly more expensive two-year fix, which Martin described as a “slightly less but still a definite winner”.
The reason why this could be seen as less of a ”definite” is that you're signed up for a longer period of time and it's hard to predict how energy prices could fluctuate long-term.
“While the 1yr is a definite winner, the 2yr is a likely but less definite winner,” he said.
“As it depends on the cap from April 2023 (which current predictions say'll drop). Yet if for price certainty it's not a bad call.”
Martin also pointed out that you’ll be missing out on around a month of lower rates if you lock in now before the new price cap comes into force from April.
But he predicts it could still save you money in the long run if prices do rise again in October.
“Do be aware by doing this now, you'll miss out on the current much cheaper current rate by about a month, yet there's no guarantee how long it'll be on for. Overall if predictions are right, it should win though,” he said.
“And do check all the terms you're offered before signing up.”
The widespread advice for the majority of households during the energy crisis has been to "do nothing" and roll onto the price cap.
This flips traditional price comparison advice on its head - as normally customers are advised to shop around for a cheaper deal.
But the trouble is, there hasn't been any fixed-rate tariffs on the open market that are cheaper than the price cap right now due to the soaring costs of wholesale gas prices.
