Further Energy Price Increases Made

Another price rise announcement by a utilities company could place Britons under increased financial pressure, it has been suggested.

Earlier this month, ScottishPower stated that gas and electricity costs on its standard tariff are to increase by 15 and 14 per cent. Resulting in bills rising by 89 pounds and 53 pounds respectively, uSwitch reported that the moves will affect just under half (44 per cent) of the 5.2 million customers of the energy firm. Adding an extra 141 pounds on to costs, the price comparison website suggested that the typical dual fuel household energy bill is now set to rise from 959 pounds to 1,100 pounds. The increases came into effect on Saturday (February 2nd).

Following on from such a price increase, homeowners may not just find that they have problems in meeting demands for payment on utility bills but also discover their capacity for repaying other monetary constraints such as loans, credit and store cards, mortgages and transport costs is diminished.

Commenting on the announcement, Ann Robinson, director of consumer policy at uSwitch, claimed that the decision by ScottishPower to increase its costs was not a surprising one following recent hikes by a number of fellow energy companies, such as British Gas and EDF Energy, in recent weeks.

She said: “Those looking to minimise the impact of higher energy costs on their household budget should seriously consider taking the following steps: move to dual fuel, pay by direct debit and go online. We have now seen all but two suppliers increase prices with an assurance from Scottish and Southern Energy that it will not put its prices up until at least the end of March. With savings of up to 325 pounds to be made, now is the time for consumers to put some competition back into the market.”

Ms Robinson went on to state that as ScottishPower’s latest increases brings it “in line with those brought in by rivals”, Britain is on track to see the average annual utility bills exceed the 1,000 pounds figure “across the board”. However, she stated that the question is whether suppliers will keep bills at more than 1,000 pounds or whether they will cut costs should a drop in wholesale prices occur.

Meanwhile, Which? reported that following the ScottishPower increase the majority of Britons will now be feeling the impact of price hikes in 2008. The consumer watchdog claimed that those coming under the most financial pressure will be those people who have never switched supplier before, are on a standard tariff and pay by either cheque or cash when their bill arrives each quarter.

For those people who are concerned that the prospect of higher energy bills will affect their ability to manage their money in the months to come applying for a cheap consolidation loan could be useful. By taking out a low-rate loan for consolidation purposes, borrowers can merge a number of demands on their finances into a single low-cost repayment. Such a loan could be helpful to those looking to get to grips with spending as 2008 progresses. Steve Rhode, chairman of Myvesta UK, recently claimed that as consumers face up to numerous monetary constraints in the weeks following on from the festive season, the start of the new year is an ideal time for them to get back on their fiscal feet.

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