Prepare for higher energy prices

Published:

18 June 2008

Topic:

News,Gas & Electricity

It's not only the oil price that continues to rise. Wholesale gas prices have also hit record highs recently, with the cost having breached £1 per therm for the first time ever. As analysts predict that gas and electricity bills may rise by almost 40% this winter, households need to brace themselves for further increases over the coming months.

The average cost of energy bills
The average household currently pays £1049.47 per year for gas and electricity compared to £850.08 only 12-months ago. In a climate of escalating costs in all areas, whether it is the cost of mortgage repayments or the weekly food shop, it's a good idea to find ways to cut costs and save money wherever you can. Amazingly, the majority of people have still not taken the opportunity to reduce their energy bills by seeking the best deal available.

What are the best deals?
The majority of UK households are still on standard tariffs, which they pay quarterly by cash or cheque. These consumers are paying around £204 per year more than they would if they changed to the cheapest deal on the market. British Gas is currently offering the best deal through its dual fuel online tariff - Click Energy 5 - where the average bill works out at £845.10.

In light of the recent gas price announcement, and the prediction that energy bills will increase further this year, you may want to opt for the peace of mind that comes with choosing a fixed tariff. These prices are guaranteed to remain at the advertised amount for the length of the contract. In an uncertain energy market, this security is something you may find attractive. The cheapest fixed-price deal is currently Scottish Power's Fixed Price Energy 2009 with an average annual price of £1021.26 - but you should take note of the £50 cancellation fee.

The trend has certainly been set on these products with cancellation fees up to £75 attached to products from Eon, Scottish Power and British Gas.   

Smart ways to save money on energy bills
As well as finding the best product, moneysupermarket.com wanted to find a new way to help you become more energy conscious. As a result, we set up a sample group to test a range of 'home energy monitors'.

The sample monitors, provided by www.ethicalsuperstore.com, are designed to show users how much energy they are using in kWh or £s.

How do they work?
Simply clip the wireless sensor on to your electricity meter (no electrician required!), put the home energy monitor somewhere you can easily see it and watch as it counts up the power you are using in real time. It even tells you the associated cost.

How do they compare and how much do they cost?  

As you can see, the product receiving the best scores from our panel was the Eco-Eye Elite. One panel member said, "I used this product myself for a week and was startled how expensive kettles, toasters, TVs and even opening the fridge was! I'd thoroughly recommend purchasing such products because you can quickly identify where your money is being spent and therefore identify ways of saving money and doing your bit for the environment. 10/10!"

On the Wattson Home Energy Monitor, a panel member described it as having a "super design... with the ability to download your energy usage from the unit to your PC and display in graphs using the accompanying software. Classic design and highly useful too - every home should have one."

All of these products are designed to help users become more aware of their energy consumption and to identify areas where you can quickly and easily save money.

In the current climate of rising energy, fuel and food prices, it is more important than ever to find the best possible deal and look for ways, where possible, to reduce your energy consumption and bills. Vote now in our poll: With the cost of living on the increase, which areas will you cut back on?

To find the best deal in your region use our gas and electricity comparison tool.

Other tips to beat rising energy costs
They may seem obvious and they are often-repeated, but here are some of the simplest common-sense approaches to saving energy:

• Replace ordinary light bulbs with energy-saving bulbs.
  
• Switch off appliances at the plug - don't leave them on standby.
  
• Use only the amount of water you need to when boiling a kettle.
  
• Turn your washing machine down to 30°C and only use a full load - if possible, use a washing line and not a tumble-drier to dry your clothes.
  
• Keep your fridge and freezer as close to full as possible. Empty space means you use more electricity as the appliance works harder to keep items cool.
  
• Only keep the fridge or freezer door open for the amount of time that you need to - and remember to defrost them regularly.
  
• Take a shower instead of a bath - but avoid using energy-sapping power showers.
  
• Turn lights off when you leave the room.
  
• Buy a lagging jacket for your hot water tank.

Have your say: What are your top tips for beating inflation and the rising cost of energy? How are you coping with rising prices? Share your experiences and inflation-busting tips in our forum.

Disclaimer: Please note that any rates or deals mentioned in this article were available at the time of writing.

Related Links

• Compare tariffs from UK gas and electricity providers
• Vote now in our poll: With the cost of living on the increase, which areas will you cut back on first?

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