Fixed
🔒 What Is a Fixed Energy Tariff?
A fixed energy tariff locks in your gas and electricity unit rates and standing charges for a set period.
Typical contract lengths:
12 months
18 months
24 months
Variable
📈 What Is a Variable Energy Tariff?
A variable energy tariff changes price when the supplier updates rates or when the Ofgem energy price cap changes.
Most households on variable tariffs:
Did not actively choose them — they ended up there after a fixed deal expired.
Key Finding: In 2026, variable tariffs usually sit at or near the price cap, while fixed tariffs are often 5–15% cheaper than capped rates.
Fixed vs Variable: Direct Comparison
Fixed Tariffs
✅ Prices locked for 12-24 months
✅ Protection from price increases
✅ Often 5-15% cheaper than cap
✅ Predictable monthly bills
❌ May include exit fees
Best for: Most households seeking savings & stability
Variable Tariffs
✅ No exit fees
✅ Can fall with wholesale prices
✅ Complete flexibility
❌ Prices can rise quarterly
❌ Usually not the cheapest
Best for: Short-term only, imminent movers
Annual Cost Comparison
Average UK household (3,100 kWh electricity + 12,000 kWh gas)
💰 Average saving with fixed tariff: £200 per year
Savings vary by usage, region, and market conditions
Low Usage Homes
Standing charges matter more
Fixed usually cheaper
Average Usage Homes
Best balance of savings & certainty
Fixed almost always wins
High Usage Homes
Locking in lower unit rates critical
Biggest savings with fixed
Common Myths Debunked
"Variable tariffs are cheaper because prices can go down"
Prices can go down, but suppliers rarely pass on reductions faster than increases.
Reality: Fixed tariffs price in market expectations
Fixed deals are priced with wholesale forecasts already accounted for.
"Fixed tariffs are risky if prices fall"
True in theory, but in practice fixed tariffs are usually cheaper overall.
Reality: Stability usually beats uncertainty
Predictable costs help budgeting and prevent bill shocks.
⚠️ Warning: When your fixed deal ends, you're automatically moved to a variable tariff, and prices usually increase. Set a reminder to compare before your fix ends.
Compare Fixed vs Variable Tariffs
See which option is actually cheaper for your specific home, usage, and location.
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