Fuel price rises catch consumers unaware

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Household energy costs have risen more than five times faster than household income since 2004.

And, according to research for price comparison website uSwitch.com, the average annual household energy bill of £1,252 now accounts for 11 per cent of a couple’s basic state pension of £11,175 a year.

The cost of energy is now the top household worry for Britons (90 per cent), ahead of the rising cost of food (77 per cent) and mortgage payments (42 per cent).

Almost a third of consumers (32 per cent) say that household energy is unaffordable in the UK.

While the average UK household income has increased by 20 per cent from £32,812 in 2004 to £39,468 today, the average energy bill has risen by 140 per cent, according to the uSwitch figures.

Households were spending an average of £522 a year for their energy in 2004, but now pay £1,252 a year – 3.2 per cent of income or double the 1.6 per cent of eight years ago.

Britons now have an average disposable income of £297 each month.

The study found 83 per cent of people believe that rising energy bills have had an impact on their disposable income, with 17 per cent of these reporting that they no longer have any disposable income as a result and 27 per cent saying energy bills have reduced their disposable income dramatically.

Director of consumer policy at uSwitch.com Ann Robinson said: “This is the cold reality facing households today; in less than 10 years our energy bills have rocketed by 140 per cent. The break-neck speed at which energy prices have sprinted upwards has caught many people unawares. Consumers are still playing catch-up.

“Energy now accounts for a significant slice of household income which is why the numbers rationing their energy use have risen so steeply in recent years. But going cold or without is a short-term and potentially harmful fix and not a long-term solution.”