Energy bills: rise up against the rises
August 2, 2011 | By:
No need for your blood to run cold. Though all the gas and electric firms are increasing their prices, there are clerical and practical ways to bring down your bills, says Sheila Prophet
Keep Energy Affordable_Open Market

The real pain will start in winter. {a href="https://www.flickr.com/photos/71772085@N00/3326866414/" target="_new"}Photo by Open Market{/a}

What’s the price of loyalty?  Even though 99 per cent of us get our energy from one of the ‘big six’ suppliers, those suppliers are squeezing their customers with painful price rises of between 11 and 19 per cent.

Scottish Power has already put those rises into action this week and will shortly be followed by SSE and British Gas (whose parent company Centrica has recently announced a healthy profit of £1.3 billion and a 12 per cent rise in payouts to shareholders).

With the other three members of the big six (E.ON, npower and EDF Energy) expected to make their own announcements any day, we are being urged to start fighting back.

Energy Secretary Chris Huhne has joined the call from consumer organisations, saying: “Consumers don’t have to take price rises lying down. If an energy company hits you with a price increase, you can hit them back where it hurts – by shopping around and voting with your feet.”

Meanwhile, watchdog Consumer Focus is advising people to switch immediately to a fixed tariff. It may cost more at the outset than the cheapest variable tariff, but promises the peace of mind of knowing your bills will stay stable for a set period of between one and four years.

As with fixed mortgage deals, you are gambling that prices won’t drop in future, but with the average energy bill having almost doubled in the past five years from £660 to £1,132,  that seems a fairly safe bet.

One disadvantage of fixed tariffs is that you will have to pay a cancellation fee of up to £70 if you change your mind, so your alternative option is to wait until all the big six have upped their prices, then jump into the cheapest available tariff.

At least it is simple to shop around and switch, with no fewer than 13 comparison websites accredited by Consumer Focus, which lists them on its site.

When looking for the cheapest deals, you can usually pare them down to the minimum by selecting an online plan, paying by direct debit and offering regular monthly meter readings instead of paying estimated bills.

You can also look for ways to reduce your energy use. There is endless advice on this on the energy companies’ own sites – and on the switching sites – and while much of it is stating the blooming obvious, changing habits can help to cut your costs.

Top tips include turning down your thermostat one degree, using energy-saving light bulbs, draught-proofing your windows and doors, ensuring your hot water tank is properly insulated and switching off appliances instead of leaving them on standby.

You can find a comprehensive list of household tips at USwitch.com. One useful addition is an energy monitor, which allows you to see exactly how much energy you are using at any time, and where you could make savings. Some energy companies offer free monitors with certain tariffs. They cost as little as £25 in the shops.

These monitors are not to be confused with smart meters, which, if all goes to plan, will be rolled out to every home in Britain by 2020. These will allow suppliers to collect meter readings automatically and thus provide more accurate bills. They will also have in-home displays that act like energy monitors.

Though the national roll-out is not due to start until next year, one of the smaller energy companies, First Utility, is offering its customers free smart meters right now, and says that they could help chop household bills by up to ten per cent.

If you are looking at larger scale solutions, such as cavity wall or loft insulation, the Energy Saving Trust provides lots of practical advice plus a guide to available grants and other offers.

While all these are useful ways to keep your bills to a minimum, the ultimate counter-measure is to beat the energy companies at their own game by generating your own energy and making them pay you through the government’s Feed-in Tariff scheme.

Going green by installing solar panels still doesn’t come cheap. The Energy Saving Trust estimates that an average system costs around £12,500. But the government is promising help with this from next year as part of its proposed Green Deal, which it says will “transform the country’s homes and make them warmer and cheaper to run”.

In the meantime, a separate government scheme called the Renewable Heat Premium Payment has been launched this month, providing householders with up to £1,250 to help with the installation of renewable heating systems such as biomass boilers, air and ground source heat pumps and solar thermal panels.

Energy Saving Trust: Renewable Heat Premium Payment

Department of Energy and Climate Change: Green Deal