Energy bills are expected to surge in 2027: Here's how to lock in a cheaper fixed energy tariff

Products featured in this article are independently selected by This is Money's specialist journalists. If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect our editorial independence.

About 20million households could be in for a nasty shock when their next energy bills arrive as the cost of gas and electricity soars. 

Typical bills, which were £1,663 a year, rose by 3.6 per cent on Thursday, which means households that pay by direct debit can expect to pay about £1,723 a year.

There’s even greater pain ahead, as independent energy market forecaster Cornwall Insight predicts bills could rise again by as much as 16 per cent in January. 

There’s one simple way that households can lock in their bills at a lower price. Signing up to a fixed tariff could both keep your bills at a lower rate than the current average, and protect you from any further price rises for one or even two years.

However, while these deals look enticing at first glance, there are several important points to consider before you go ahead. 

Turning up the heat: Energy prices are expected to rise in the coldest months of the year 

Why are prices rising? 

Energy prices are volatile and beholden to geopolitical events. Conflict in the Middle East has been disrupting supply, which pushes up wholesale prices. 

The energy watchdog Ofgem sets a cap on the amount suppliers can charge customers who are on variable rate tariffs. This is designed to protect households from being overcharged. 

Most are on this type of tariff – they’re the default, so unless you’ve actively chosen an alternative, that’s what you’ll be on. 

The cap rose on October 1 from £1,663 to £1,723 for a typical household. It would have been £45 higher had the Government not removed VAT from electricity bills last week. 

It is predicted to rise again in January to as high as £1,999, which would mark the highest increase in four years. 

Major energy suppliers British Gas, EDF Energy and Eon Next have released forecasts for April 2027 of £1,995, £2,096 and £2,082 respectively. But these figures are only estimates and they could change substantially. 

Even if the conflict ended tomorrow, the supply disruption pushing up prices would take months to correct itself, Cornwall Insight warns.

> Compare the best energy deals for your home with Uswitch and This is Money* 

How fixed energy deals can help

Some deals currently available undercut both the October and predicted January price caps. 

These typically last for 12 or 24 months, so you have certainty over how much you’ll be charged for energy. This should help you budget over the colder months. 

If you can find a year-long fix priced lower than both the current price cap and the predictions for January, this is strongly worth considering. You are guaranteed to get cheaper energy for three months – and you are likely to benefit for months after that as well if the forecasts of price rises are correct. 

Even deals that sit slightly above the current cap but significantly below the predictions for January could save you money. You are also locking in savings for winter, when energy use will be highest. 

However, if wholesale prices suddenly drop and you have secured a fixed, long-term deal, there is a risk you will pay more than if you’d stayed on a variable tariff. 

While the energy price cap is given as an annual figure, this is only what the average household can expect to pay for their energy. 

Similarly, fixed tariffs do not limit the total cost of your bill - they fix the amount that you will be charged in standing charges and per unit of energy. 

If you use more or less energy than the average household - medium-sized with two or three people living there – your bill will look different to the annual amount quoted. 

Some of the cheapest switches available according to the price comparison website Uswitch last for as long as two years. 

You should consider how prices might move over the entire length of the fix, and whether you would be comfortable being on the tariff if energy prices did go down. 

Keep an eye on any exit fees as well. These can be as much as £125 for each type of fuel, gas and electricity.

How much can you save?

The cheapest energy tariff is currently offered by Fuse Energy, according to the comparison website Uswitch. This is an 18-month tariff priced at £1,615 annually for the average household – £108 below the current cap and £384 below the predicted one for January. Exit fees are £50 per fuel. 

The cheapest energy deals over the past year have consistently been offered by smaller suppliers. 

The cheapest fix from a major supplier is from British Gas. This is priced at £1,669 annually for the average household – £54 below the current cap and £330 below January’s predicted cap. However, this is a 23-month fix, and exit fees are £125 per fuel. If energy prices eased over that period, it would be expensive to leave. 

Fuse Energy has a 12-month fix priced at £1,716 annually for the average household.

It’s worth comparing deals by using a price comparison website such as Moneysupermarket or Uswitch. Entering details such as your postcode and actual energy usage should give you more accurate annual prices.

Top energy deals

Supplier	Tariff	Fix duration	Average annual bill	Difference vs October price cap (£1,723)	Saving vs January predicted price (£1,999)	Exit fees	Availability
Fuse Energy	October 2026 Fixed (18m) V1	18 months	£1,615	£108 below cap	£384 below predicted cap	£50 per fuel	Uswitch.com, Confused and Fuse Energy
Fuse Energy	September 2026 Fixed (24m) V18	24 months	£1,651	£72 below cap	£348 below predicted cap	£50 per fuel	Direct via Fuse Energy
British Gas	Fixed Exclusive Sep28 v2	23 months	£1,669	£54 below cap	£330 below predicted cap	£125 per fuel	Direct via British Gas
Eon Next	Next Fixed 24m Exclusive v24	24 months	£1,670	£53 below cap	£329 below predicted cap	£100 per fuel	Uswitch.com, Confused and Eon Next
Outfox Energy	Fix'd Dual Oct26 24M v1 - Family Advantage+	24 months	£1,671	£52 below cap	£328 below predicted cap	£100 per fuel	Direct via Outfox Energy
Source: Uswitch.com. Prices correct as of 9.08am, 5 October 2026. The tariffs included within the table are the cheapest non-bundle fixed tariffs, not variable or tracker, and exclude collective, retention and loyalty tariffs. All energy tariffs and prices mentioned are subject to change without notice, and rates vary upon region. These are the cheapest tariffs available based on suppliers who have updated Uswitch with their rates.