Energy bills could quadruple over next decade

Household energy bills could reach almost £5,000 a year by 2020, nearly four times higher than they are today, according to new research from uSwitch.com.

The average household energy bill today is £1,243 a year, but uSwitch.com had predicted that costs could be sent spiralling by ongoing pricing trends coupled with investment in infrastructure, the cost of cutting carbon and boosting energy efficiency.

The huge investment programme shortly to be undertaken by the energy industry and Government is expected to total £233.5 billion. This includes plans to put a new ‘smart meter’ in every home by 2020 to reduce energy consumption and prepare Britain for the eventual move to a low-carbon ‘smart grid’ – a move which along will add £548 a year onto household energy bills for the next 15 years, according to uSwitch.com.

The £4,185 increase by 2020 predicted by uSwitch.com also factors in inflation and volatility in the wholesale markets, as seen by suppliers over the last 5 years, which the report predicts will continue to be a dominant theme in the energy market going forward.

Ann Robinson, Director of Consumer Policy at uSwitch.com, said:

“This is a wake-up call for us all. The £5,000 a year energy bill may seem like an outside possibility, but we have to remember that energy bills doubled in the last five years alone and that the huge investment needed just to keep the lights on in Britain will alone add £548 a year onto our bills. The fact is we are entering a new era of high cost energy and households will have to adapt their behaviour accordingly.”

“The Government has been banging the drum for energy efficiency for a while now, but consumers have been reluctant to spend money on these measures. As a result, energy efficiency has been massively underperforming even though it is one of the biggest defences we have against escalating energy costs. We also have a competitive energy market, and yet less than 5% of consumers are on the most competitive energy plans – most people are paying far more than they have to for the energy they use.”

“This has to change. My advice to consumers is to invest in making your home more energy efficient, reduce the amount of energy you use and make sure you are paying the lowest possible price for it. Big projects such as a new energy efficient boiler or home insulation can be expensive, but the savings you make through cutting the price of your energy could be re-invested into energy efficiency measures so that you reap even greater rewards in the future.”

If you want to make sure you are on the best tariff for you, TotallyMoney.com can help. Visit http://www.totallymoney.com/utilities/ now to compare deals in your area. You could save hundreds per year.