Cold Snap Will Push Up Energy Bills But Not Household Energy Prices
on: January 12, 2010, 4:31 am
Households could see their winter fuel bills increase by GBP60
if the cold snap continues into February, but reports that energy
prices could go up are a red herring says uSwitch.com, the independent
price comparison and switching service.
It costs £3 a day on average to heat a home, but uSwitch.com estimates that this could increase
by GBP1 a day as consumers contend with the current freezing conditions. If the cold
snap lasts a fortnight it will add GBP14 on to household winter fuel bills. But if
it lasts two months it could cost households an extra £60.
However, reports that household energy prices could go up as a result of increased
demand are misleading - energy suppliers buy their energy around a year in advance
and can meet the current short-term increase in demand by topping up on the daily
spot market. This means that consumers do not need to worry about their prices going
up in the short to medium term.
Tom Lyon, energy expert at uSwitch.com, says: "If the cold snap continues
through February it could add £60 on to household
energy bills, but the cold snap would have to continue for far longer to have an
impact on energy prices. Higher demand because of sub zero temperatures and the
current rationing of energy to certain businesses does not mean suppliers will need
to increase household energy prices. Hopefully this will reassure consumers, but our
advice would be to think now about budgeting for an extra £60 for when the winter
fuel bill drops through your letter box."
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uSwitch.com is a free, impartial online and telephone-based comparison and switching
service, helping consumers compare prices on gas, electricity, water, heating cover,
home telephone, broadband, digital television, mobile phones, personal finance
products and car insurance.