Last updated: April 2026
Compare fixed-rate and variable energy tariffs to understand which type offers better value for your household.
A variable tariff (also called a standard variable tariff or SVT) has unit rates and standing charges that can change. The rate is capped by Ofgem price cap, which is reviewed quarterly. When wholesale energy prices fall, variable tariffs can decrease. When prices rise, your bill goes up too, but never above the cap. Variable tariffs have no exit fees and you can switch at any time without penalty.
A fixed tariff locks in your unit rate and standing charge for a set period, usually 12 or 24 months. This means your rate per kWh stays the same regardless of what happens to wholesale prices or the Ofgem cap. Note that "fixed" refers to the rate, not your total bill — your bill will still vary based on how much energy you actually use. Fixed tariffs may have early exit fees if you switch before the term ends.
Fixed tariffs are generally better when: energy prices are expected to rise (you lock in a lower rate), you want budget certainty and predictable bills, or when suppliers offer fixed deals below the current price cap rate. In a rising market, fixing can save hundreds of pounds over the contract period compared to staying on the variable cap rate.
Variable tariffs may be better when: energy prices are expected to fall (you benefit from rate decreases), you do not want to commit to a contract, or when no fixed deals are available below the cap rate. Variable tariffs offer maximum flexibility since you can switch at any time without exit fees.
When comparing fixed and variable tariffs, always compare the total annual cost based on your actual usage, not just the unit rate. A tariff with a lower unit rate but higher standing charge could cost more overall. Use AskUKEnergy to compare tariffs based on your specific usage and postcode for an accurate comparison.
When your fixed tariff ends, your supplier will move you to their standard variable tariff (SVT) unless you actively choose a new deal. Suppliers must notify you at least 42 days before your tariff ends. This is a good time to compare the market and either re-fix or switch supplier.
Yes, you can switch away from a fixed tariff before it ends, but you may have to pay an early exit fee. These fees are typically £30-£50 per fuel. Some fixed tariffs have no exit fees — check your contract terms. Even with exit fees, switching could still save you money if a significantly cheaper deal is available.
The Ofgem price cap sets the maximum rate that suppliers can charge on their default (variable) tariffs. Fixed tariffs are not subject to the cap and can be priced above or below it. However, most competitive fixed deals are priced near or below the cap to attract customers.
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Information sourced from Ofgem, Citizens Advice, and DESNZ. Last updated April 2026.
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