Big six energy firm Scottish and Southern Energy (SSE) is freezing its standard gas and electricity prices until at least April 2017. But if you're on its standard tariff, you can save £100s switching - and with the price of the cheapest deals on the market soaring in recent weeks, now's the time to act.
The announcement by SSE, which has some eight million customers, comes as a surprise given that energy firms have been widely predicted to hike prices this winter.
But while it means those on its standard tariff won't see any immediate increase - and customers of M&S Energy and Ebico, which are supplied by SSE, will also see prices frozen - elsewhere the price of the cheapest deals has already begun to rise. The average price of the market's cheapest tariff was £724/yr back in May, based on typical usage, but £822/yr today.
Those on SSE's standard tariff will still pay an average £1,071/yr on typical use, and could save around £250/yr by switching to the cheapest deal. To see how much you could save by switching, use our free Cheap Energy Club.
Who's affected by the SSE price freeze?
The price freeze announced today applies with immediate effect and lasts until 1 April 2017. It affects all SSE, Scottish Hydro, Southern Electric, Swalec and Atlantic domestic customers on a standard variable tariff, regardless of how they pay their bills. Prepaid customers are also covered by the price freeze.
If you're on a fixed deal, the rate you pay is already set by the tariff you're on, but if your deal ends before April 2017, remember you'll automatically be moved on to SSE's standard variable tariff unless you switch.
Those on a standard variable tariff at M&S Energy and Ebico will also benefit from the price freeze.
'Anyone on SSE's standard tariff almost certainly overpaying'
Responding to SSE's announcement today, MoneySavingExpert.com managing editor Guy Anker said: "This may seem good news on the surface but anyone on SSE’s standard tariff is almost certainly already overpaying, possibly by £100s a year, so people shouldn't see this as a message to rest on their laurels.
"The way to save is to urgently lock in to a cheap fix, with urgent being the key word. The price of the cheapest new customer deals is soaring – up for a typical household by £100/yr in the last six months.
"Someone on a standard tariff with any of the big six energy firms, including SSE, can save about £250 a year by switching."
How prices are already rising
While SSE has pledged not to raise the price of its standard tariff, price hikes are expected this winter and we've already seen some rises.
In July we reported that the cheapest energy deals were disappearing, and that trend's continued. The average price of the market's cheapest tariff was £744/yr last month but has jumped to £822/yr today.
We've also seen sharp price hikes at smaller suppliers outside the big six firms. In August Ovo Energy and Co-op Energy both raised prices, while last month GB Energy Supply hit customers on its standard variable tariff with an eye-watering average 30% hike.
In the wake of SSE's announcement today, we've contacted the rest of the big six to ask if they can also commit to a price freeze. So far British Gas and Npower have declined to comment, while a spokesperson for EDF said: "We constantly review our prices". We'll update this story when we hear back from the others.