Temperatures may be dropping, yet fuel prices are going up. The question on people’s chattering lips as we slip into the season of ice cold temperatures and blustery winds is: what can be done to reduce energy bills this winter, as householders struggle to keep warm?
The number of people needing help will increase this winter as people are having difficulties to afford the rising cost of fuel, which has soared by around 20%.
Citizens Advice claimed last year 100,000 people came to them for help with fuel bills, and this year, more than 12,500 people sought advice on reducing their fuel bills in October alone.
A term that has frequently been cropping up lately is ‘fuel poverty’- when a household has to spend more than 10% of its income on fuel. The number of households experiencing fuel poverty is increasing because the cost of energy is rising, so people are having to allocate more of their income to pay these rocketing bills. David Burman from British Gas says: “Unfortunately, fuel poverty does exist. There are some people out there who just can’t afford the rising prices.”
As fuel prices continue to increase, we need to consider why this is happening, who is being affected and what is being done about the situation.
Wendy Pudge, a single mother from Sheldon, is one of many who struggle to pay energy bills. “Prices are extortionate,” she said. “People cannot keep up with the rising bills- the increase is too steep. Tax on fuel should be reduced dramatically. I heat a minimum amount of rooms to try and save money.”
So what do people struggling to pay their bills think could be done to improve the situation? Miss Pudge says tax on fuel needs to be lowered: “Every home should be insulated and paid by the government as we pay a lot in poll tax. The price of fuel should be lowered in winter as vast amounts are being used, and pensioners and the proven disabled should be given reduced rate fuel. If the tax on fuel was reduced, people would not have to worry so much about how to keep warm, cook, wash... all of which are a necessity, particularly in the winter months.”
Shweta Deware from British Gas, one of the UK’s leading providers of renewable energy systems, defended the rising prices: “In the last few months worldwide events have increased the demand for gas and oil. This means the wholesale prices we pay for gas and electricity are much higher than before. It’s never an easy decision to increase our prices and we’ll continue to help all our customers through this difficult time.”
Although energy providers do work to keep prices as low as they can, Shweta said: “Now, with the UK’s North Sea gas dwindling, we’re importing more than 50% of the gas we need from other countries and wholesale gas prices are 30% higher this winter than they were last winter.”
Energy experts will help customers choose the solution that’s right for them and their home, and there are lots of ways customers can save their money, including the ‘Warm Homes Discount Scheme’, set up by British Gas to help vulnerable customers with their winter bills. Those who qualify will receive an annual rebate on their electricity account of £120, which will be paid onto the electricity account within the first 3 months of 2012.
British Gas’ operating profits rose by 24% last year, and most of this profit is being reinvested to secure new sources of gas and to expand into nuclear energy. “These investments are necessary to ensure British Gas customers have access to clean, reliable energy in the future,” Shweta said.
It may be that appropriate action taken by consumers can help combat the increasing problem of paying for energy bills. Customers should ensure they are getting the best deal on gas and electricity.
When energy secretary Chris Huhne and David Cameron set out plans to tackle energy costs last month, Huhne stated 99% of household energy in Britain is provided by the ‘big six’, and 85% of consumers never consider switching supplier. Huhne was critical of consumers who fail to shop around for the best energy prices, and Ofgem discovered people don’t switch although it could ultimately provide them with big savings. Therefore, maybe the market should be made more competitive to get a better deal.
For consumers seeking advice on the most appropriate action for them to take, help is available. The Energy Saving Trust offers services to help people save money on fuel bills- they introduce energy-saving measures into homes and drive improvements in the energy saving market by working with businesses, local authorities and the government and providing expert insight and knowledge about energy saving.
John O’Shea from The Energy Saving Trust said: “We are an impartial advice service that exists to reduce our carbon impact by reducing energy usage and saving the customer money.” In terms of recommendations, John offers: “Insulation retains the heat that you produce- insulating a loft to the full 270mm recommended depth can save £175 from the heating bill of the average gas-heated semi-detached home. Similarly, filling the cavity wall will save £135 from the heating bill- each and every year. The savings are even larger if you are paying more for fuel because you rely on off-gas network options like LPG or oil.”
With regards to ways of saving money, John claims: “The Energy Saving Trust website is packed full of advice to help stop people wasting energy and money. For instance, turning your thermostat down and reducing room temperature by 1°C could cut heating bills by up to 10%, and typically saves around £60 per year. Energy saving light bulbs also last up to 10% longer than ordinary bulbs.”
So although energy bills are on the increase, there are ways you can reduce the amount you are spending on fuel.
For further tips on ways to stop wasting energy, visit: http://www.energysavingtrust.org.uk/Take-action/Money-saving-tips/Energy-saving-tips/Top-ten-tips
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