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What we can do now to make energy more affordable

The energy industry must improve in the long-term, but that doesn’t mean we should do nothing until then. We’re attending an energy summit to find practical things we can do today to help you save money this winter.

Have you put your heating on yet? It’s starting to get cold and many are reaching for the thermostat. But with rising energy prices, many will be holding off in fear of ever increasing bills.

Energy prices are the number one financial concern for consumers. You might have noticed that at Which? we’ve been turning up the heat on energy companies recently – getting more affordable energy is your priority and so it’s ours as well.

Getting round the table

Tomorrow Which? is attending a very important energy summit. The government, consumer groups and suppliers are all sitting down together with one shared goal – to work out what we can do to help consumers right now.

We want to see how to help those who are struggling to pay their bills, people who might never have switched or be confused by tariffs, and people who are worried about putting their heating on in October because they’re nervous about the impact on their pocket.

I’m hoping that the summit will give us some real, practical solutions that can be implemented straight away. I’m looking forward to walking out of that meeting with commitments from everyone around the table about what we can do together to ease the pressure before things get too cold.

There are longer-term problems

Of course, there are lots of problems that will take much longer to solve. We must encourage more competition in the market and make sure it delivers genuine value and choice for consumers.

The energy summit is just one of the first steps on the long road to a better energy market. We’re going to be there at every step – tackling confusing tariffs, exposing poor energy advice, and working with the government and Ofgem to instigate the change that you want to see.

But, in the meantime, we don’t want to tell you to hold on and just wait until all the problems have gone – that’s not realistic. We know there are things that the energy companies, the government and we at Which? can do right now. For instance, encouraging switching, making sure you’re on the cheapest tariff with your current supplier, and giving you clear information about how to save energy before the winter sets in.

I hope that after Monday’s energy summit you’ll have the right tools to save money on energy straight away. Not in two, five or ten years time – but this winter, in time for Christmas.

Comments
Guest
derek turner says:
13 November 2011

Hi folks
We can all moan (This includes myself) forever and ever about fuel prices but as long as we have governments who openly support foreign owner ship of our own energy companies these companies that have already been set up out of English tax payers.
and don’t forget many back pockets are being are being filled many times.
So you may think we can alter things but truthfully we never will as long as all the above keeps taking place
dirk

Guest

The government could reduce the cost of gas and electricity at a stroke by reducing VAT to zero. EU directives prevent them from being exempt from VAT. One of the “advantages” of being a member of the EU! A further reduction of two to three hundred pounds in gas and electricity domestic charges per year could be achieved by cancelling all the present uneconomic green carbon agenda and subsiding wind power, but this would again be contrary to another “advantage” of being a member of the EU.

Guest

Sorry for the delay in responding to a number of the comments on this Conversation about what is driving energy price rises. A number of you have commented about the impact of green taxes on our energy bills and asked for Which?’s position on this issue and I thought it might be useful to give you a brief summary of our views.

Which? wants a market that provides energy for consumers at a fair price now and in the future. At the moment, the energy market does not serve the consumer well and that has to change. Furthermore, significant investment is needed to renew our energy system. While Which? is not an environmental charity, we recognise that our energy system does need to be sustainable. Fossil fuels will not last forever and burning them to produce electricity has negative impacts on the environment, including contributing to climate change.

Nevertheless, the investment needed in our energy system must be made in the most cost effective way possible. Consumers cannot be expected to write a blank cheque – and it was for this reason that Which? supported the Government’s decision to cut the Feed in Tariff (though we have concerns over the particular process and timings of the cut).

Furthermore, with levies supporting the Government’s environmental and social agenda also adding costs to our bills, we need much more transparency about how much these programmes add to our bills and how this money is spent by energy companies. At present energy efficiency measures make up around 10% of our electricity bills and 3% of our gas bills and with changes to these initiatives in the next year much greater scrutiny is needed.

Finally, it is important to recognise that gas is an important source of flexible power in the UK and is likely to remain so for many years to come. It produces around half the green house emissions of coal. However, the wholesale price of gas – not green energy and energy efficiency levies – has been the single biggest driver of the recent cost increases in energy bills. Gas is such a key driver of energy bills is because it comprises about 50% of all generation in the UK and sets the price of electricity. Global demand for gas is increasing and we are now a net importer, so there are some benefits to reducing the level of our dependence gas.

As the Government considers the future of our energy generation through its White Paper on Electricity Market Reform, we will continue to scrutinise these issues to ensure that consumers are not penalised in the future. We will therefore continue to listen to comments like those posted in this conversation and seek to address them in our ongoing policy work on this important issue.