The number of households in fuel debt has increased, new research reveals, highlighting the importance of obtaining the right energy plan.
Figures released by the Money Advice Trust shows the number of people in debt to their energy provider has increased by 180 percent in the last four years.
In the last 12 months alone the charity has also seen an increase of 10 percent in the number of people calling for advice with their fuel debts.
The latest report from the Bank of England predicts gas and electricity prices could increase by 15 percent and 10 percent respectively, causing further pressure to struggling households.
With these increases the average annual energy bill could hit an all-time high of £1,279, uSwitch reveals, adding an extra £148 onto the average bill. The latest batch of price rises that ended in March already added six percent onto householdsí bills.
ìFuel debts have now become a major part of our debt landscape and are one of the fastest growing problems we have witnessed at National Debtline,î commented Joanna Elson OBE, Money Advice Trust chief executive.
ìAs consumers we have to pay close attention to how much gas or electricity we use and whether or not we have the right tariff, not always an easy decision.î
Compare Energy Plans
If you are thinking of switching energy supplier, to reduce the amount you spend on gas and electricity, then consider the savings you could make by opting to receive your energy bills via email instead of through the post. Most providers offer money off also if you switch to their price plan online, and they offer consumers the ability to manage their account this way too which for some is a quicker and easier way of monitoring their energy usage.
To prevent getting lumped with an unexpected bill, opt to pay your energy usage each month by direct debit. This will reduce the likelihood that you will not be able to pay it and rack up debt. However, for this to work you will need to ensure you have the money in your account to pay the bill in full each month.
Smart Monitor/ Meter
Many energy providers now offer customers the chance to install a free smart monitor in their house. British Gas has recently adopted this to enable customers to pay only for the energy they use so they do not receive an estimated bill which tends to see customers pay over or under their actual usage.
The British Gas EnergySmart device shows households exactly how much energy they are using and, according to the provider, is a good way of reducing the amount of energy used. E.ON has also distributed their own smart meter to help households reduce their energy costs.