Consumers have been urged to switch suppliers regularly to limit the impact of significant energy price hikes predicted by the end of the decade.
The Energy Advice Line ( http://www.energyadviceline.org.uk/ ), the price comparison, switching and advice service for energy consumers, said actively seeking out the best deals and switching suppliers was the only way for consumers to stay in control of utility bills.
The warning follows a prediction by energy giant RWE npower that British consumers will pay £240 more for their annual energy bills within seven years, with average years bills rising from £1,247 to £1,487 by 2020.
The supplier believes official forecasts have been too optimistic when it comes to the cost of implementing green technology, which would actually add £82 to the average energy bill by the end of the decade, up from £34 this year, and £12 in 2007.
The Energy Advice Line’s managing director, Julian Morgan, said that in the current climate of spiraling bills consumers needed to make informed choices about their energy supplies and not stay loyal to one company.
“Sadly, under 20% of energy consumers switch suppliers regularly, which means that the vast majority are probably missing out on significant savings,” Mr Morgan said. “It is universally acknowledged, including by the government and Ofgem, that energy customers save money by regularly seeking out the best deals and changing suppliers accordingly. “With these forecast price rises, customers are probably throwing money away if they’re not shopping around.”
He said that in light of the predicted size of the energy price rises it was also worth considering locking into longer-term energy deals. “Consumers need to think carefully about the best deals to sign up for,” Mr Morgan said. “Short-term agreements of 12 months, for example, are likely to be cheaper than longer term deals. “However, by the time that 12-month deal expires, it is likely that energy prices will have risen considerably. Paying a premium for a longer-term deal could actually save you money over the course of two or three years if prices rise in the way that’s forecast.”
Mr Morgan said that while it was complex for consumers to negotiate their own way through the hundreds of tariffs and contracts on offer, reputable independent price comparison and switching services made it easy. “Consumers just need to ensure that the service they use is completely independent with no financial allegiance to a particular supplier, and that they have a wide range of suppliers on their panel,” he said. “The other thing to remember is that reputable companies don’t engage in cold-calling or heavy pressure selling techniques. Making a decision about your energy supplier is too important to be rushed.”