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Martin Lewis: Should you fix your energy bills? 80% are on the Price Cap but you can fix now at 7% less than it – what you need to know

A woman looking at her smart meter.
Molly Greeves
Molly Greeves
News & Investigations Reporter
16 January 2025

If you're on the Energy Price Cap – like eight in 10 households in England, Scotland and Wales aar– your bills are expected to rise by between 3% and 5% from April. But by locking onto a fix now, you can typically save 7% straight away and protect yourself from future hikes for 16 months, as MoneySavingExpert.com founder Martin Lewis explains in the latest episode of ITV's The Martin Lewis Money Show Live.

MSE Update: 21 January 2025: Since publishing this news story, energy prices are now predicted to rise by between 3% and 6% (not 5%) from April.

For further help, including more details on our blagged E.on Next deal, which is cheaper and longer than the cheapest fix, see our latest weekly email.

ITV's The Martin Lewis Money Show Live – Tuesday 14 January 2025

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Should you fix your energy bills? 80% are on the price cap, you can fix now at 7% less than it

From The Martin Lewis Money Show Live on Tuesday 14 January 2025 courtesy of ITV. All rights reserved. Watch the full episode on ITVX.

Transcript of what Martin said on the show...

Martin Lewis: "Prices dropped last winter. They came down again. They bottomed out in July, 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.

"Now, when we finished in December, this is what was being predicted for the Price Cap back then. It was going to come down slightly in April and slightly a bit after that. This isn't going to be good."

[Graph showing energy predictions on 16 December 2024.]

An energy graph showing the Price Cap predictions made in December 2024.

"Let's watch week by week, because these predictions come out week by week, what has happened to the predictions since then. Watch the numbers change and the line change. Here you go."

[The lines on the graph gradually moves up to show where energy price predictions are currently at.]

A graph that shows how the Energy Price Cap will increase from April 2025.

"So, that's where we are now. The prediction is it's going to go up 3% in April then down slightly, but still more than we are now. This is the EDF prediction: down slightly when we get to July, up again in October. So roughly where we are.

"Now I need to say the predictions depend on what you're assuming Ofgem does. I've got an E.on prediction –
this prediction was out today – an E.on prediction, as well, from today. E.on's predicting it's going to be even higher than that. British Gas is somewhere in between but a slightly higher afterwards."

It's unlikely the Price Cap will drop substantially in the next few months

"Now the important thing to understand: the April price – it's based on wholesale rates over a set period. That period is the middle of November to the middle of February. We are two thirds of the way through the assessment period. In other words, one's saying up 3%, one's saying up 5%.

"One thing you know is happening in April: up. It's going up. And somewhere probably between there, because the wholesale rates... [the] world would need some massive worldwide catastrophe for energy prices to drop so much that it was going to bring it down in April, when we're two thirds of the way through the assessment period and it's an average rate over the period.

"The further out you go, the more crystal ball gazing it is. But look, I think once you get to July, on what they're looking at the moment, it'd be very unlikely for it to be dropping substantially in July – although you've seen that predictions change week by week – and then once you get further out it's difficult.

"So this is the key thing to remember with where I'm going, the prices I'm going to talk about now, the differences, are based on today's Price Cap. But if you're on the Price Cap, the likelihood is you won't be paying today's Price Cap coming forward. You will be paying more."

However, as mentioned above, most people can save by fixing. Use our whole-of-market by default Cheap Energy Club comparison to get a bespoke price.

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