E.On now offers households £50 off their energy bill if they fix for two years – is it worth switching?

E.On is offering customers money from their accounts if they switch to a two-year fixed rate, a sign that competition between suppliers is starting to heat up.

Suppliers have started to reintroduce fixed rates as wholesale energy prices stabilize.

E.On is offering new and existing customers £50 bill credit when they switch to the Next Fixed 24-month fixed rate online.

Most energy companies offer a switching reward for new customers, but E.On is the only supplier that offers customers a switching reward for specifically switching to a permanent contract.

E.On offers billing credits for customers who switch to a two-year fix. Will it save you money?

Fixed rates are currently around the Ofgem price ceiling, meaning customers won’t make huge savings on their monthly bill.

However, if prices start to rise again, as is widely predicted, households that lock in now could end up paying less than if they were on a standard variable rate.

E.On’s two-year fixed rate currently stands at £1,952, meaning they’ll pay £118 more per year than if they were on the adjusted price cap – without taking into account the £50 credit.

In August, Ofgem announced that the price ceiling would fall from £2,074 to £1,923 for the average household. At the same time, it changed what she considers “average” energy consumption, as people use less power than before due to higher costs.

Under the old assumptions the price ceiling is still £1,923, but under the new consumption values ​​this has fallen to £1,834.

E.On is one of the few suppliers that offers a two-year fixed rate.

Fixed two-year deals tend to be more expensive because suppliers cannot predict what will happen to prices in one year, let alone two years.

If you do not want to be sure that you know how much you will pay for your energy in the coming months, there may be little point in switching.

It’s worth remembering that Ofgem has switched from price limit calculations every six months to every three months, meaning any increase or decrease in prices will be reflected in your bill sooner.

> Do you have to switch to a fixed energy rate this winter?

Customers who wish to end their E.On deal early will also have to pay a £300 exit fee if they have signed up for both electricity and gas, and will not be eligible for the £50 credit if they cancel within 30 days.

Customers have until November 7 to switch to E.On’s two-year deal and will receive the £50 credit, which will be automatically applied 30 days after the tariff start date.

The offer is only available to households paying by direct debit and is not available to customers paying on demand or on demand. Another barrier is that a smart meter is also needed.

E.On Next customers are eligible for discounts on other products such as EV home chargers, heat pumps and solar panels, as well as up to £150 off a boiler.

Energy experts told This Is Money that competition in the energy market would increase this winter.

While prices are still high, Martin Young, equities analyst at Investec, said the growth of electric vehicles and the installation of solar panels will see suppliers shift their focus to offering innovative rates.

‘The growth of electric cars will equate to the growth in the number of charging points installed, and if you have a charger hanging on your wall you’ll probably want an innovative rate so you can charge your car at a time of day where it is probably cheaper.

‘You need a supplier who wants to offer innovative rates. I expect you’ll have some competition in that area.”