Protect myself from energy price increase – does this make sense?

My energy prices are below. I seem to have been lucky in fixing my price early this year for 2 years. I currently pay £95 a month.
So if I’m fixed until early 2023 I’m thinking of overpaying a fair bit for the next year (maybe £40 a month I can afford) then when my offer ends I’ve saved up enough capital to reduce the monthly payments a fair bit for when they inevitably increase.
Obvs I can get the money back at any point and I may be paid it back automatically but I could just pay it back in to have a buffer.

It’s a rubbish plan, or is it?

Energy price

Just put in in a savings plan of some type, ISA or similar….??

Your plan is to lend money interest-free to Sainsbury’s?

Or just put the extra into the building society each month and not leave it with an energy firm that could go bust.

Or bung it in Crypto – who knows… 🙂

You’re assuming the company will stay afloat (and it’s not Sainsburys we’re talking about).

As others have said, its not a rubbish plan to be thinking about safeguarding for the future, however if you just stick the extra in a bank its protected upto like 80k, saves you the hassle of energy firm going bust and fighting to get your money back with everyone else.

So if an energy firm goes bust you lose any credit you have with them?

So if an energy firm goes bust you lose any credit you have with them?

In theory no – but why risk it when there are much safer ways to save cash?

So if an energy firm goes bust you lose any credit you have with them?

You dont lose the credit with them, this should either be passed on to your new provider or sent back to you, however this isnt always the swiftest or easiest process and mistakes can happen so unless you keep proof of everything, screenshots of online accounts etc, as when firms go bust they tend to take the online services away, then its riskier than just leaving money in the bank.

So if an energy firm goes bust you lose any credit you have with them?

Definitely no. It’s part of the OFGEM rules that any credit is protected. Not sure how you’re still with Sainsbury’s, they returned all their customers to British Gas and stopped reselling ages ago, but BG are one of the safer options at the moment.

They couldn’t have stopped selling, I signed up with them recently.

It’s a rubbish plan, or is it?

A shockingly bad idea…

If you have extra funds available just put them into a savings account. It’ll be less risky and you’ll get a bit of interest back if you shop around.

I’d hope by early 2023 prices would be back to normal.
Any reputable energy company would have matched the deals they have sold, by buying forward in the market.

Not sure how you’re still with Sainsbury’s, they returned all their customers to British Gas and stopped reselling ages ago

They’re now a white label reseller for Eon, with the bonus of extra nectar points. I hope that means they aren’t likely to go bust as I just switched to them!

Getting 4% interest with ovo currently.

Still not plowing my money into them but there would be worse ideas if you were getting interest on your surplus.

Gone for my own hedging and put solar panels on the roof. Which halfed our summer bills.

They changed their supplier so I’m actually with Eon.

Unless I could convert my heating to electric it wouldn’t be worth getting solar as we don’t use much electricity. Bigish house for us 2 but when I renovated it I used LEDs for all the lights and we don’t have much on standby, most of our goods are fairly new and don’t use much electricity.

Washing machine/tumble drier (wet days and toddler) dishwasher and e bike were our main users and now all put on timers to coincide with sunny weather. + 2 computers and 3 monitors for me working from home. -all in was adding up to 80 odd quid a month which was unsustainable.

My bulbs have been led for years but Generally you don’t have lights on when solars generating

Its a long game but It seemed like a good way to secure part of my electric for a period. Over 10 years(panels will likely last longer than that) its equivalent of hedging at about 14p/kw if the grid never pays me a penny for what I feed back…..I don’t see energy getting cheaper than that over 10 years…..if it does oh well that’s the nature of hedging….win some lose some.