While rising energy bills made the spotlight leading up to the Budget in an effort to highlight Britains’ monetary struggles, little was offered by Chancellor George Osborne by way of help.
With Ofgem recently announcing that energy bills have a reached record high, consumers struggling with inflation rates of 2.8% and energy suppliers revealing profits in the billions, many households are now joining the ranks of those in fuel poverty.
When a resident is spending more than 10% of their income on paying for gas and electricity, they qualify as being in fuel poverty.
Household bills have risen 25% in the past five years, while wages have gone up a mere 6%.
Many were hoping these issues will be addressed in today’s Budget. But in the meantime, consumers do not just have to sit by as they’re bills mount up. Instead, bill payers can be proactive by communicating with their energy provider and understanding their plan scheme.
Communicating with providers
Those struggling to pay energy bills are not alone. uSwitch research this year revealed that seven in 10 households went without heat at some point because they simply could not afford to warm their homes. Another 17% have forgo heat regularly for this reason.
uSwitch Director of Consumer Policy, Ann Robinson, said of the research: ““This severe level of rationing can have serious consequences – in fact over a third of consumers (35%) say that cutting back on energy is affecting their quality of life or health. This is unacceptable.”
Understanding the tariff
With Ofgem pledging to make the energy market “clear and simple” for consumers, understanding your energy bills and tariff should get easier.
The Retail Market Review announced by the energy regulator included direction for suppliers to offer simpler choices, clearer information and fairer treatment.
Some suppliers have already shifted their policies in this direction; British Gas announced a restructuring of its tariff system in June 2012. In the move, the supplier removed four tariffs and introduced the Clear and Simple plan.
More recently, npower announced simplified tariffs by ending its two-tier plans.