Green tax change might end fixed price popularity

Consumers across the UK have been told to proceed with caution when signing up to a fixed rate tariff, with price cuts expected next month.

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Many energy providers have pledged to decrease their costs should the government deliver on their promise to ‘roll back green taxes’, with a change expected as early as December 5th.

This is the day that Chancellor of the Exchequer, George Osborne, releases his Autumn Statement which will address green levies and will include information about future policy towards them.

Customers had previously been advised to fix to a long term energy deal in a bid to combat persistent price hikes from energy suppliers.

However, with prices set to decrease, the merits of a fixed rate deal have been questioned, with some commentators arguing that it might be more financially beneficial to stick to a variable package.

One energy firm that has bucked the trend is EDF, who identified that they would not reduce energy cost should the green levies be reduced.

However, the company currently offers two competitive fixed rate deals that finish in 2015 and 2017, and have pledged to transfer customers to cheaper deals without any charge.
“If a customer found a better deal elsewhere, they’d be able to move without charge,” a spokesman said.


With George Osborne releasing his Autumn Statement next month on the 5th of December, consumers have been warned to approach signing up to fixed price tariffs with caution.

Entering into arrangements which have no early termination charges has been advised, as this grants consumers flexibility should there be a drastic change to current prices following the statement.

However, it has also been advised that consumers look at the long term costs of a fixed tariff before entering into an arrangement, as the likelihood is that the financial merits are only applicable to the most competitive of deals.

Npower have disclosed that they would apply price reductions should green levies be reduced and outlined that they intended to pass these on to both their standard variable and fixed rate tariffs.

British Gas is yet to comment on price changes, but have pledged to pass on the benefits of green tax reductions onto their customers.

Small firms

Intriguingly, a handful of smaller energy firms have identified their intention to apply reductions to their fixed rate tariffs should the government deliver on their promise to ‘roll back’ green taxes.

One such firm, Co-op Energy, have recently launched a fixed rate deal that runs until 2017.
The company had previously cited that they would increase prices by 4.5% but in light of the government’s pledge about green taxes have reduced that sum to 2.5%.

However, they clearly outlined that if the government reneged on their promise about green tax costs, that they would immediately return the price rise to its original value.

“Whatever the outcome, we will honour that fixed-price tariff,” said a spokesperson. Green taxes and levies currently contribute around £112 to an average dual fuel customer’s energy bill.