New cheapest energy deal from EDF could save households £109 on bills

•  New fixed rate undercuts the Ofgem price cap, offering a significant bill saving

EDF has launched the cheapest fixed-rate energy deal on the market, costing £1,588 a year for average gas and electricity use.

The Simply Fixed Direct 1y Nov25 deal means the typical household would save £129 a year from now until 31 December, then £109 from 1 January until 31 March.

That is compared to energy deals limited by the Ofgem price cap, which most households are still on.

The price cap limits how much energy firms can charge customers on variable-rate deals for units of gas and electricity, as well as daily standing charges.

The typical home now pays £1,717 a year with a price capped deal, meaning the new EDF fixed rate could save users £129.

However, the Ofgem price cap is reset on 1 January 2025. 

The current prediction is that this will fall to £1,697, according to analysts at Cornwall Insight, who have correctly predicted price cap movements since energy bills began rising in late 2021.

However, EDF thinks the price cap will actually rise in January to £1,736.

If Cornwall Insight is right, taking the EDF deal would mean the average home saves £109 a year from January. If EDF is right, the saving would be £148. The price cap is then reset again in April, July and October.

Is taking the EDF tariff a good idea? 

One risk is that energy prices fall, leaving users paying above the odds for gas and electricity as their unit rates are fixed.

However, in an unusual move EDF has scrapped exit fees for the Simply Fixed Direct 1y Nov25 deal, provided customers sign up through EDF.

That means all households have to do is find a cheaper deal and switch, with no fees to pay.

EDF director of retail Rich Hughes said: 'At this time of year people are using more energy and are more concerned about the cost of their energy bill. We want to help in any way we can and have taken advantage of wholesale prices dropping to offer another market-leading deal.

'The market does remain unstable and with the majority of customers on standard variable tariff likely to face another increase come January, customers still on that tariff could benefit from signing up to this tariff.'

EDF is also offering a 12-month tracker tariff, which tracks at £50 below the price cap, with the saving coming from standing charges rather than unit prices.

The energy provider has also boosted the amount of cashback customers can earn when they refer friends to EDF. 

Until 17 November, customers will get £75 for each successful referral they make and their friend will enjoy £50.

Existing customers can sign up to the new tariffs with EDF's MyAccount, while new customers can get a quote and sign up on the EDF website.