Energy suppliers are seeking to tie customers to fixed deals costing as much as £4,000 a year, as ministers face growing warnings over “untenable” proposed rises to the price cap this spring.

A 12-month fixed deal for a typical household now costs an average of almost £2,500, according to data from comparison website uSwitch.

That is £500 more per year than the £2,000 level that Ofgem, the energy regulator, is expected to increase the cap on variable tariffs to in April.

Ovo Energy, the UK’s second-biggest supplier, is offering a fixed-rate deal worth just under £4,200, according to the data.

Certainty – a cap on costs even – costs money.

Someone, somewhere, has to take that risk after all. And they’ll want to be paid for doing so.

As it happens we’ve got such a system. Futures and options. Not entirely worthwhile for the single retail consumer but a firm can do it. Thing is, you need lots of liquidity, lots of speculators, so that you can transfer that risk.

Fun how the standard lefty shout is that we must tax liquidity in speculative markets so as to make risk transference more expensive, isn’t it?

6 thoughts on “Snigger”

  1. Concern is growing over the financial impact of bill rises on millions of households

    Who is concerned ? I thought that we established yesterday that this was a virtuous circle. I mean the proles have to pay anyway.

    I also never understood this “hot meal/heating” dichotomy. A tin of spag bol in a microwave is done in 90 seconds. One doesn’t have to have toast with it.

  2. “People will have to choose between heating and eating”

    I can assert with 100% confidence that people will choose eating.

  3. “A 12-month fixed deal for a typical household now costs an average of almost £2,500”

    How much? HOW MUCH!?!?!?!?

    TWENTYFIVE HUNDRED QUID????? What the **** are they doing, living in a greenhouse? With all the windows open?

    My total gas+leccy is £500 a year.

  4. My fixed deal is £540 per year, fixed for two years. Anyone who signs up to £4 000 a year deserves all they get.

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