Fixed vs Variable Energy Tariffs Explained
Not sure whether to go fixed or variable on your energy? Here’s everything you need to know to make the right choice for your household.
In this guide
What is a fixed energy tariff?
A fixed energy tariff means your unit rate — the amount you pay per unit of gas or electricity — is locked in for the length of your contract. Typically this is 12, 18 or 24 months.
If energy prices rise during your contract, you won’t pay more. If they fall, you won’t benefit from the drop either. Your standing charge may still change slightly but your unit rate stays fixed.
💡 Key point
A fixed tariff does not mean your bill stays the same — it means your unit rate stays the same. Your bill will still vary depending on how much energy you use.
What is a variable energy tariff?
A variable energy tariff means your unit rate can go up or down in line with the wholesale energy market. Your supplier can change the rate they charge you, usually with 30 days notice.
Variable tariffs are capped by Ofgem’s energy price cap, which limits the maximum amount suppliers can charge per unit of energy. The price cap is reviewed every three months.
Fixed vs variable — pros and cons
Fixed tariff
Pros
✓ Price certainty — you know what you’ll pay
✓ Protected if energy prices rise
✓ Easier to budget monthly
Cons
✗ May have exit fees to leave early
✗ Won’t benefit if prices fall
✗ Contract end means shopping around again
Variable tariff
Pros
✓ No exit fees — switch anytime
✓ Prices can fall if market drops
✓ No long contract commitment
Cons
✗ Prices can rise with little notice
✗ Harder to budget month to month
✗ Less price certainty
Which is better in 2026?
There is no universal answer — it depends on where energy prices are heading and your own priorities.
As a general rule of thumb:
🔒 Choose fixed if energy prices are currently low and you want to lock in a good rate before they rise — or if you simply want the peace of mind of knowing exactly what you’ll pay.
🔄 Choose variable if energy prices are falling and you want to benefit from the drop — or if you want the flexibility to switch without paying exit fees.
The best approach is to compare both options for your postcode right now and see which works out cheaper based on your usage.
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Compare energy deals →What is a standard variable tariff?
A standard variable tariff (SVT) is a type of variable tariff — specifically the default tariff your supplier puts you on when your fixed deal ends. It is almost always more expensive than the best available deals on the market.
Millions of UK households are currently on their supplier’s SVT without realising it. If your fixed deal ended and you didn’t switch, there’s a good chance you’re on one right now.
⚠️ Watch out
Suppliers are not required to notify you when your fixed deal ends and you roll onto their SVT. It happens automatically — and it usually means a significant price increase. Always set a reminder for when your deal ends.
What about exit fees?
Exit fees are charges applied when you leave a fixed tariff before the contract end date. They typically range from £20 to £60 per fuel — so up to £120 for a dual fuel deal.
However there are two important things to know:
1. No exit fees in the last 49 days — most suppliers allow you to switch without penalty in the final 49 days of your contract. This is the ideal time to start comparing deals.
2. No exit fees on variable tariffs — if you are on a standard variable tariff or any variable tariff, there are no exit fees. You can switch at any time for free.
How to switch to a better tariff
Whether you want to switch from variable to fixed, fixed to variable, or just find a cheaper deal with a new supplier, the process is the same and takes about 10 minutes.
Check your current tariff
Look at your energy bill or supplier app. Note whether you’re on fixed or variable, your current annual spend, and when your deal ends.
Compare deals on FastSwitch
Enter your postcode and monthly spend to instantly see fixed and variable deals from top UK suppliers side by side.
Switch in one click
Click Switch now on your chosen deal and complete the sign up with your new supplier. They handle everything — you don’t need to contact your old supplier.
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Compare energy deals →Written by the FastSwitch team · Last updated April 2026
FastSwitch is a free UK energy comparison service. We may earn a commission when you switch via our site — this never affects the deals or prices you see.