Impact Of Higher Energy Bills

Yet another utility price rise announcement could put Britons under more financial pressure, it has been suggested.

According to price comparison website uSwitch, the recent decision by British Gas to put up its rates could increase bills for about half of its 16 million customers. The energy company has announced that both prices for gas and electricity are to go up by 15 per cent each, increases of 85 pounds and 54 pounds. Coming in with immediate effect, it is reported that the price hikes will add 139 pounds on to the typical energy bill for dual fuel customers as they go up from 912 pounds to 1,051 pounds.

Such price increases, as well as putting up energy bill costs, may also impinge upon consumers' ability to meet other sources of financial demand such as personal loans, credit cards and mortgages.

However, it was suggested that consumers could find themselves coming under even further monetary pressure as the company recently reported that it is considering implementing a 'postcode lottery' price system. This would see British Gas customers pay different prices for gas depending on where in the country they live. According to the price comparison website, should the firm decide to go ahead with this policy it could be joined by a number of other suppliers. It was suggested that this may mean some Britons will pay about 100 pounds more for their energy than others.

Commenting on the move, Ann Robinson, director of consumer policy for uSwitch, said: "Today's inflation busting price hike will leave 16 million consumers wondering what this company has done to deserve their loyalty and continued custom in 2008. Last year, British Gas spent 53 million pounds on advertising, convincing consumers that it had turned over a new leaf. Now it is getting back to what it does best - shoddy service, high prices and poor value for money.

"Today's increase is the thin end of a wedge - British Gas has left the door open for a change in pricing policy that will see consumers paying different prices for gas based on where they live in the UK. If this postcode lottery policy is adopted across the board by all suppliers then previous estimates that price rises would add an extra 15 per cent or 150 pounds onto household bills in 2008 could fall short."

She added that consumers can no longer afford to stick with an uncompetitive energy deal. Ms Robinson stated unless they are on a cost-effective online price plan, then homeowners should be prepared to switch utility suppliers to "protect their household from the impact of higher energy bills".

The news comes days after npower reported it is to put up its energy prices. Meanwhile, EDF Energy claimed yesterday (January 17th) that it is due to increase costs.

For people worried about the prospect of how more costly energy bills will affect their ability to manage their finances, the application for a debt consolidation loan might be advisable. Taking out this type of loan could help borrowers not only to meet utility costs but also other types of financial demand, such as credit and store cards, grocery bills, mortgage payments and any previous personal loans, quickly and effectively. A debt consolidation loan might also be of particular use to people from Jersey, as a report from the island's Citizens Advice branch last year indicated that an increasing number of residents are struggling with their finances. It was also claimed that consumer debt in Britain is becoming "a more serious problem than ever".