High Energy Bills – They May Not Be Your Fault

dermot 2

Ofgem CEO Dermot Nolan announces full inquiry into the energy market as profits soar

For a long time, consumers have thought that their high household energy bills must somehow be their fault. Perhaps they were too profligate with their electricity – too quick to switch the heating on in the autumn, perhaps, and not careful enough to go round switching off all the lights.

Perhaps that is why the public has been keen – well, reasonably so – to be educated. What in practice can we do to save money on our household bills?

The Green Deal may not have taken off, but most people know and understand that loft insulation is a must and double glazing a desirability. We know, too, that replacing old appliances such as fridges washing machines and storage heaters with energy–saving products also makes sense, even if some cost a bit more in the first place.

There is also constant noise about switching energy suppliers, although in reality that is a message that still has to get through to most people. They tend to see it, mistakenly, as a lot of faff in exchange for not a lot of savings.They are, of course, mistaken: the truly savvy switch every six months to ensure they are on the cheapest deal. Others switch every year to make savings.
Those who have never switched and are still with their original supplier could be surprised at what they could save – perhaps £300 a year. And switching is pretty easy to do online. However, there is only so much a consumer can do to keep down costs and, in periods of winter chill, it is disheartening to hear stories – as we do routinely – of poorer households who have to choose between heating and eating.

“Energy Suppliers profits shot up by 1,000% in just five years”

So, how galling it is to hear that energy companies – which, by the way, are allowed to increase bills by up to 10.4% as and when they want – are currently making £101 profit a year from each and every household.That profit has shot up 1,000% in just five years, and is up by over double on last year’s £48 profit.

The sheer size of today’s profit should not be under-estimated: today’s £101 mark-up compares with a profit of just £9 per household back in 2009. How much difference has it made to customer’s bills? Well, in 2009, the average household bill was £1,282, compared with £1,346 now.
Furthermore, the energy companies are profiteering at a time when there has been a drop – of up to 38% – in the wholesale costs of electricity and gas.

“Instead of raking in yet more profits, shouldn’t the companies have been passing on these savings?”

Ofgem enquiry is welcomed

The official Ofgem inquiry is welcomed by consumers

Not surprisingly, Ofgem has now announced a full inquiry into the energy market.The Competition and Markets Authority will see whether companies such as British Gas, Npower, Eon and Scottish Power, have been ripping consumers off.

“Consumer organisations such as Which? And Citizens Advice say that the inquiry is long overdue”

Consumer organisations such as Which? And Citizens Advice say that the inquiry is long overdue and must be thorough, while a Labour MP, John Roberton, says any energy company found guilty of rigging the market by over-charging, should be fined – with that money going back to consumers.

Certainly, the inquiry is good news for us all – particularly those who wondered exactly why their bills seemed to have crept up, even though they thought they had been so economical with their energy as to rank as positive misers.

EHE provide high-quality low-cost electric heating solutions. We help thousands of households and businesses each year to reduce their heating costs with our range of modern electric radiators. If you’re seeking advice on electric heating, please contact us on 01252 560770, or visit www.electricheatingexpert.co.uk

electric heating expert - logo