Powergen, the UK arm of German utility E.ON, has launched its first ever fixed-price energy product, which will allow both new and existing dual fuel and electricity customers to fix their energy prices at Powergen's current standard prices until January 1, 2009.
The UK energy supplier said that it launched the product in response to a recent survey of 1,000 UK consumers, conducted by BMRB on its behalf, which found that although over a third (35%) of consumers would fix their energy prices to avoid future price fluctuations, over half (57%) don’t want to pay a premium for doing so.
Graham Bartlett, managing director of Powergen Retail, said: Fixed price until 2009 offers consumers the opportunity to fix the amount they pay at today’s standard prices with no tie-ins or exit fees if they change their minds. This is simply a win-win product for people who want complete reassurance with absolutely no hassle.
The fixed-rate offering allows customers to benefit from discounts of up to 9% for taking electricity and gas and paying monthly by Direct Debit; manage their energy account online and receive paperless bills, and move home and still take the product with them.
In addition, those who sign up to receive the product will collect one Tesco Clubcard point for every GBP1 that they spend on electricity and gas.
However, Karen Darby, founder of SimplySwitch.com, the UK price comparison and switching service, said that although a fixed-price offering can provide peace of mind for energy customers, many online tariffs are often cheaper.
Most suppliers now offer online tariffs that are up to GBP200 per year cheaper than their standard rates. While they offer no protection against rising costs, energy prices would have to rise by up to 25% before a fixed deal became the cheapest option, Ms Darby revealed.