Energy News

Energy bills to hit £5,000 by 2020 says uSwitch

Monday 22 June, 2009

By becca.talbot@consumerchoices.co.uk

Brits could face annual gas and electricity bills of nearly £5,000 by 2020 if current price trends continue, say energy experts.

If energy prices rise by 42% a year over the next 11 years, it will push the average household energy bill up to £4,733 a year and force thousands of British families into fuel poverty.

The research, carried out by uSwitch.com, is predicted using pricing trends over the last five years, taking into account inflation and the government investment programme to cut carbon emissions and improve energy efficiency.

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 past five years. The fact is we are entering a new era of high cost energy and households will have to adapt their behaviour accordingly.”

The average household annual energy bill has more than doubled since 2004, from £580 to £1,243.

According to consultants Ernst & Young, investment in Britain’s energy supplies will cost £233.5billion, of which half will go on renewable energy generation and the rest on new conventional power stations, the roll-out of smart meters and National Grid upgrades.

It is predicted the investment will add an extra £548 to the average annual fuel bill over the next 15 years.

Household energy bills shot up last year when crude oil prices hit a record of $147 a barrel. Although prices since fell to less than $40 a barrel, they have risen again sharply in the past couple of months, to about $70, threatening to start pushing up the UK’s energy prices again.

Chris Eagle, commercial manager at EnergyChoices.co.uk advises customers to make their homes as energy efficient as possible now to avoid bigger bills in the future: “Improving the energy efficiency of your house, with cavity wall and loft insulation, will help keep your bills down in the future.”

“Also, look at reducing your energy consumption, by switching to more efficient products, such as energy saving light bulbs,” continued Eagle. “You should also regularly compare energy prices, to make sure you’re not paying more for your gas and electricity than you have to.”

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