Martin Lewis issues urgent plea for households to take up cheaper energy offer before cap rise

Martin Lewis says all bill payers should consider a new deal before the price cap increases in April

Martin Lewis has shared his last-minute advice for British Gas customers and all savers looking to cut costs on energy bills before prices increase for most people next week.

From 1 April, Ofgem’s energy price cap will be increasing to £1,849, up 6.4 per cent from £1,738. The energy price cap is the maximum amount energy suppliers can charge for each unit of energy for someone on a standard variable tariff. That includes most households, and it is expressed as an annual bill for an average home.

The change in prices is largely reflective of the cost of wholesale energy – the amount energy firms pay for their electricity and gas before supplying it to households – alongside other factors like distribution costs.

The money expert has long-advocated that people consider moving to a fixed deal on their energy in the face of these rises, with more expected in the future. This stands to bolster households from further rises, as the cost of their energy will stay the same for a fixed term.

Martin Lewis says all bill payers should consider a new deal before the price cap increases in April (PA Archive)

But he has now pointed out one great British Gas deal that is only around until 5pm on Friday 28 March. This means anyone looking to take advantage needs to act fast. The deal fixes the price of energy at 13 per cent below the price of next week’s price cap. This is a near market-leading deal, but is time limited.

Mr Lewis said: “We've blagged a British Gas fix via our Cheap Energy Club comparison. On average, there's only one smaller firm that's cheaper (Outfox the Market - it will be shown in the comparison), but this is BG's most competitive deal for a while (it's available direct too, but without our extra cashback).”

Taking up a fixed-energy deal means that the cost of energy will remain the same regardless of the energy price cap. This applies whether it rises or falls, however, meaning there could be a loss in some cases. However, with the cap not expected to fall until July – and even then not below the price of most current fixes – it will be a good idea for most.

For those who are concerned about the commitment, EDF currently offers a fixed deal that is 9.9 per cent lower than April’s price cap, and has no early exit fees.

Speaking on Radio 4’s Today programme last month, Mr Lewis was critical of the price cap, which he has in the past called a “pants cap.”

He hit out at Ofgem’s “weird time lag price cap mechanism” which means “even though energy prices are now starting to drop a bit,” they are based on prices from December to February, when costs were higher.

Mr Lewis added that he believes the measure should be replaced with a ‘social tariff’ where “those people who can’t engage in the competitive market or aren’t able to ... should just be given a cheap tariff by default.”