Gas and electricity supplier EDF Energy promoted expensive fixed-rate deals over cheaper collective agreements and has now said it will retrain its employees on the matter
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EDF energy has apologized for pushing a £2,100 energy contract that was £400 more expensive than its cheapest tariff.
Energy bills have skyrocketed due to soaring gas costs and the Russian war in Ukraine, and experts warn they could soon reach £3,000 for many households.
Most household energy bills are now governed by the Ofgem Price Cap . This caps the annual electricity price at £1,791 for people on variable tariffs who use an average amount of gas and electricity.
Historically, fixed rate deals have been far cheaper than variable rate deals, but the price of fixed rate deals is not subject to the price cap.
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As a result, variable rate energy deals are now almost always cheaper than fixed rate energy plans, which have skyrocketed in price as energy companies are free to charge what they want for it.
For example, one EDF customer, a Mirror reporter, was surprised when he moved home and received a letter from EDF advising him to “choose a fixed-rate plan for peace of mind.”
When he called EDF to get his energy bills drawn up, the company again mentioned the fixed rate tariff, quoting him around £2,100 a year.
The reporter then asked if he could select any variable rate deals and was told he was entitled to a bill of £1,711 a year – almost £400 a year less.
If he hadn’t known he was going to ask for it, he would have been stuck paying the higher bill Cost of Living Crisis This also means high costs for goods such as groceries and petrol.
EDF has now apologized and explained that the customer should have been informed of the cheaper tariff without further enquiry.
An EDF spokesman told the reporter: “All of our customer service advisors are instructed to share the details of all our tariffs with customers.
“We’re sorry this didn’t happen when you called and we’ll be reconfirming this guidance with our advisors.”
But energy expert Lynsey Jones of Quote4Energy said the £2,100 tariff could have advantages if energy costs continue to rise.
Because a tariff with a fixed term binds a price for a specific term, in this case one year.
A variable tariff, on the other hand, can rise or fall in price.
So if the electricity bills rise, the customer pays less over the course of a year at a fixed price.
However, it is uncertain what will happen to energy bills and most experts agree that variable collective agreements, subject to the price cap, are the cheapest option for most people.
Lynsey said, “If the fixed price is 25% above the price cap, it could actually be a pretty good deal that ends up protecting the customer.”
https://www.mirror.co.uk/money/edf-energy-apologises-pushing-energy-26928811 EDF Energy apologizes for pushing energy contract by £400 more than its cheapest tariff