Låse Strømpris: Should You Fix Your Electricity Tarrif?
We’re all looking for ways to cut down on our bills, and one important bill we all need to deal with is electric bills. In January 2024, a megawatt-hour wholesale price cost about 69.4 euros. So, it’s only wise for individuals to consider options to cut down on this expensive but important expense.
While there are several ways to manage and lower your electric bill, the charging method you opt for is something you need to consider. You can read this article to learn several ways to save money on your electric bill. Therefore, many are thinking of fixing their electricity prices.
On the off chance that you are understanding this, it implies you’ve additionally considered doing this. Nonetheless, before you do as such, you want to realize how it’s finished, and the advantages and disadvantages of doing such Therefore, to help you decide, we’ll reveal all these important details. If you’re ready, let’s begin…
What a Fixed Electricity Tariff is and How it Works
A fixed (or restricting) power levy is a charge choice that permits you to pay a decent measure of cash for the power you utilize no matter what how much energy you consume. This implies that the sum you pay isn’t affected by the fluctuating business sector cost. Depending on your supplier, you can choose this option for a month or even as long as five years.
While this method is open to all customers, you need to initiate the process. You’ll have to contact your supplier and inform them of your intention to choose the fixed tariff. Both parties will agree on the fee to be paid and how long the arrangement will last.
This agreement is binding and you might incur penalty fees if you breach the terms of the agreement. Once you have signed the agreement and all necessary arrangements have been made, your next electric bill will be the fixed amount both parties agreed to. This will continue until the agreement expires.
Other Tariff Options
Apart from the fixed tariff, there are other options you can choose. Given you’re thinking of switching to the fixed option, it means you’re currently on one of these alternatives. So, to help you determine if the current or arranged tariff is better, it’s good to know more about all the options available to you. With that said, here are other tariff alternatives:
Spot Price
The spot price alternative is dependent and determined by the market charges. This means if the market cost goes up, your bill will increase. If the market cost goes down, your bill will be reduced.
The price change occurs quickly, and there may be a fluctuation with each passing hour. As such, you’re left at the mercy of the market price. Choosing this type of charge takes away the chance to predict how much you’ll be charged. A supplier that specializes in spot price tariff is Tibber.
Variable Price
Similar to the spot price option, variable price relies on the market price as well. The difference between these tariffs is that in this case, the cost of electricity is fixed for a particular period, usually 14 days. This slight difference allows customers to predict how much their bills will be better than the alternative we discussed above. However, what you pay is usually higher than the spot charge.
Pros of Binding Tariff
Still undecided on the charge to choose? This section should be of great help. We’ll delve into the pros of fixing your electricity price.
Predictability
With the binding charge, you know how much you pay at the end of every month regardless of the energy consumed. This way, planning your monthly budget can be done efficiently without having to account for price changes in electricity. Also, you don’t have to bother about the changing market prices. Weather conditions as well as other issues that influence the general prices won’t concern you.
Chance to Pay Less
Given how often electric fees skyrocket, a binding plan might protect you from paying these high costs. When the fees are higher than what you agreed to, you get to enjoy paying lower. The other alternatives do not have this advantage.
Discounts Possibility
Upon signing the agreement, most suppliers offer new customer discounts and bonuses. For instance, if you choose Gudbrandsdal Energi as your supplier, you stand the chance of getting a car hire discount at Hertz. We recommend that you consider this feature when choosing a supplier.
Cons of Binding Tariff
As great as the binding tariff, there are some disadvantages. Let’s talk about them if they can sway you the other way. Here they are:
Can Get Expensive
Remember when we said you get to pay less when general electric fees are higher? Well, the tables can turn the other way easily. When the general fees are lower, you get to pay much more than the market price. Based on our findings, the cheapest alternative is the spot price tariff.
Breach Penalty Fees
Binding agreements are exactly what the name implies; they are binding. You are expected to keep to the terms of the agreement until the duration is over. However, most folks might be unable to cope with the fixed price especially when the general charges are lower.
If you choose to opt out of the agreement, you’ll pay a breach penalty fee. This fee is determined by the months or years left on the contract. So, if you don’t want to deal with this hassle, you shouldn’t sign the agreement.
Should You Fix Your Electricity Prices?
The choice is solely yours to make. However, the choice will depend on some important factors. If you prefer security and predictability rather than variations, then you can go ahead and fix your electricity price. On the other hand, if you don’t mind the price fluctuations and would like to take advantage of low costs, spot or variable rates would work best for you.
Tips for Fixing Your Electricity Price
If you’ve made up your mind to fix the price of your electric bill, you shouldn’t go ahead and just do it. Such action might cause you to enter into a bad agreement that you’ll opt out of later. At this point, you know what happens when you breach an agreement. Therefore, to protect you from this, here are tips that will ensure you get the best deal and enjoy your choice.
Pay Attention to Surcharges
The electricity bill you receive will show you the main cost per kWh as well as other surcharges. These surcharges include VAT and other electricity consumption-related charges. You can visit bestestrøm.no/binde-prisen-på-strøm/ to learn about surcharges. Therefore, before you sign the contract, look for offers with reduced surcharges.
Follow Market Trend
Some factors affect the cost of energy, and careful research might give you insights into future energy prices. Therefore, you need to follow events and news. Pay attention to electricity prices each month.
Sign the Contract at the Opportune Time
The best time to fix your electricity price is when the fees are low. With this step, you won’t pay so much in excess at that point. Even when the market price increases, you won’t be affected as you’ll maintain the agreed fee.
Compare Suppliers
Do not sign the first agreement you get. Instead, receive offers from different suppliers and then compare them to see which one is the best. By comparing different suppliers and electric rates in Pennsylvania, you can make an informed decision that best meets your financial and energy needs. As we said earlier, pay attention to surcharges and also discounts and bonuses. Sign the contract of the supplier that has reduced surcharges and the best discounts and bonuses.
Look for Price Guarantee
This might not always be attainable given that the only supplier that actively offers this is NorgesEnergi. Nevertheless, it’s still worth trying. You can negotiate with your supplier if they’re offering and will allow you to pay the lowest market price. This guarantee will help you save money and not spend much more even when the general energy costs get lower.
Conclusion
The option of fixing your electricity price allows you to pay a specific amount every month for a particular period. While this tariff has its advantages, it also has its disadvantages. Choosing whether to do this or not depends solely on an individual’s preference.
To ensure you make the right choice, we’ve provided you with an extensive discussion on this matter. We looked at the pros and cons of this tariff. We also revealed tips that will help you fix the price correctly.
