Home energy customers have been dealt a blow, as it has been revealed that suppliers will be ensuring that they foot the bill for news infrastructure needed in the industry. Despite huge price spikes already taking place in 2013, this trend is set to continue according to consumer groups.
It is predicted that domestic energy bills could increase by in excess of £600 within seven years in order to allow suppliers to the power and energy flowing. The watchdog has reportedly written to the Treasury to indicate just this, ahead of next week’s budget which will more than likely bring bad news for the consumer.
£118 Billion Investment Needed for Energy Infrastructure…
Which? have predicted that the United Kingdom’s energy companies will need to invest up to £118 billion on new infrastructure over the aforementioned time period, meaning that the consumer will need to foot the bill despite the providers recording significant profits over the course of the last few years. This is set to include domestic energy customers as well as businesses across the country.
The new infrastructure includes the construction of brand new power stations, building state of the art wind farms and the replacement of grids as the nation looks to sustain its power supply and also dramatically reduce carbon emissions.
Energy Bills to Surpass £2,000 Per Year…
The average bill would exceed £2,000 per year if these forecasts turn out to be correct and this is based on wholesale cists of electricity and gas remaining stable during this period. This equates to a massive £640 rise a year for households across the United Kingdom for their all-important energy and power. Executive Director of Which? Richard Lloyd was keen to warn home energy customers of what may be coming their way, so they can budget accordingly.
The consumer champions have duly started a campaign calling for a full market investigation into these potential energy price hikes which will look to establish whether or not customers will be paying a fair price for their gas and electricity.
At least one of the ‘Big Six’ Energy suppliers has not guaranteed that they will be making these investments as they aren’t certain as to whether or not it will be profitable. Due to the fact that the energy firms rely heavily on investors, these commercial decisions need to be made and time will only tell as to how this issue develops.
Prices Hinge on Next Week’s Budget…
One tactic which is thought to be a viable option, is for Chancellor George Osbourne to freeze the Carbon Floor Price in the forthcoming budget. This would tackle the rising costs being faced by consumers and at least provide a short term solution to the issue.
Current tax policy is such that companies need to pay a fee for their right to pollute the atmosphere but by freezing or abolishing this, around £8 per month could be saved on future energy bills.
Consumers Should Ensure They Are On Correct Tariff…
One way that business and home energy customers can look to reduce their monthly bills before these surges occur, is to ensure that they are on the right energy supplier. There are many different suppliers out there all offering varying tariffs, so there is a good chance that customers may not be on the cheapest product. To find out if you could save money instantly on your energy bills, you can take advantage of many energy price comparison services.
