Energy price hikes ‘imminent’ - Gas and electricity - News - Moneyfacts

News

Energy price hikes ‘imminent’

Energy price hikes ‘imminent’

Category: Gas and electricity

Updated: 16/08/2013
First Published: 16/08/2013

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Customers have been warned to expect energy price hikes of between 5 – 10% in the new year due to the increasing costs of wholesale pricing.

The warning comes from energyhelpline, which estimates that fuel bills will, on average, rise by between 5 – 10% in January.

"There are clear indications that energy price rises are close. I would not be surprised if they are announced within the next two months. In fact you could describe the energy market as a volcano about to erupt. The lava may soon descend on consumers across the country wiping out their household budgets," said energyhelpline director, Mark Todd.

"We know from experience, when one supplier announces price rises, others follow and in the last three years these have come in the summer and autumn. It may be mere coincidence, but there are distinct advantages of introducing a price rise before the cold weather hits as the increased rates kick in as gas and electricity usage rises."

Cash-strapped consumers worried about what further energy price hikes will mean to their household budgets can save money now by switching to a fixed price tariff, giving them peace of mind that their bills won't rise anytime soon.

There are a number of competitive fixed price energy deals on the market at the moment, some of which see prices fixed until 2016.

If the estimated 5-10% price rises per year are factored in, a household could save £892 by fixing their energy tariff for three years (see the table below for details).

Save money by fixing for three years:

Typical Bill
(based on current OFGEM averages and assuming 7.5% price increase pa)

Average Bill
Npower Price Fix to September 2016

Saving

2013

£1,420

£1,318

£26

2014

£1,527

£1,318

£209

2015

£1,641

£1,318

£323

2016

£1,764

£1,318

£335

Total

£892

Source: energyhelpline.com, 8 Aug 2013
All calculations are for an average usage dual fuel household paying by monthly direct debit.
Average usage as defined by OFGEM is 16,500 kWh pa of gas and 3,300

What Next?

Save up to £331 by switching your Gas and Electricity today

Compare utility prices

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

British Gas freezes standard energy tariffs

British Gas has announced that it’s freezing its standard gas and electricity tariffs for the winter, ensuring that customers needn’t worry about price rises in the chilly months ahead. But is that enough to ensure households aren’t paying too much?

Living in a new home could cut fuel bills by half

Older homes will always be slightly more expensive to heat, with less insulation and sneaky draughts making these character-filled homes harder to heat efficiently. But did you know just how much more this could cost you? It could be double…

Standard energy tariffs are “fundamentally unfair”

We all know how expensive energy bills can be, particularly at this time of year when we’re all turning the thermostat up a notch. But what if you’re paying even more than you should be? If you’re on a standard tariff, that’s a very real possibility.
 
Close