Wholesale energy prices have surged to 11 times normal levels – a record high – in the past fortnight, following a surge in gas demand, low wind speeds, and power station closures
Soaring prices have led some gas and electricity suppliers to pull their tariffs from comparison websites in the past week.
Comparethemarket is suspending its GoCompare service because only three small energy companies offer deals.
A spokesperson said that they would resume energy comparison once they are confident they can provide true comparisons for customers.
Jane Lucy, of switching site Labrador, said: “These suppliers may not return to the market for months. We will now be instructing customers not to switch.”
The lack of deals is down to a surge in demand for gas and electricity which has seen energy prices surge to 11 times above normal levels in the past fortnight.
In a big to keep up with demand, the UK was forced to fire up two old coal power plants to help guarantee electricity supplies this week.
Some small energy suppliers have also been affected by the rise in wholesale prices.
People’s Energy and Utility Point had over 500,000 customers each, but they stopped trading Tuesday. Five suppliers have been shut down since August 1.
In a catch 22 for customers, households are being urged to switch to avoid falling victim to these rising wholesale costs.
Ofgem is increasing its price cap for standard tariff and other default deals by £139 a year from October 1.
The typical gas and electricity customer is likely to see their bill go up by £139 to £1,277 a year from next month.
The price cap restricts the amount companies can charge customers for standard variable tariffs.
Households have also been warned the cap could rise by an extra £280 next year to mark the 60% uplift in wholesale prices.
Joe Malinowski from TheEnergy-Shop.com said that wholesale gas prices rose 68% over the past five weeks and that costs have increased by an average of 324 percent over the same time last year.
“He said data from Germany shows wholesale electricity prices have risen 66 percent, and are up 174 percent year on year.
Mr. Malinowski added: ‘The simple maths implies that, as things stand, the next level of the cap will increase by around £275-£280. This would take the energy price cap, when it is next reviewed, and increased, on April 1, 2022, to around the £1,555 mark.
“To put that into context, price-protected standard tariffs would be 50 percent higher than they were two years prior.”
MoneySavingExpert’s cheap energy club can help you find better rates if you are shopping around. Which? Both uSwitch and Which?
Why is it important to find a lower deal?
When any fixed term energy deal ends you will automatically revert to your energy supplier’s standard tariff, which is the most expensive kind on the market and the price plans hit by the energy price cap.
If you haven’t switched in a while, it’s likely you’re paying the standard rate and that you could make a substantial saving by ditching your supplier, hence why you should shop around for a fixed plan.
You might consider switching to a tariff that does not charge exit fees. This is especially important as prices are at an all-time high.
Remember, while it’s an option to speak to your existing provider about a cheaper deal, there might be an even bigger saving elsewhere.
Regulator, Ofgem estimates the typical household will save around £280 by switching.
Here’s how to save money on your energy bills.