Your Winter Budget – Rising Energy Bills

Energy prices are set to increase this winter, for the most part this is due to the steep increase in demand in the global wholesale energy market. Despite this increase, by employing effective budgeting and planning you can ensure that you remain financially resilient. Here are some factors to keep in mind while budgeting this winter.

Energy prices are set to increase this winter, for the most part this is due to the steep increase in demand, which has put a strain on the global wholesale energy market. As a result, providers that deliver energy to UK households are having to pay more for their supply of energy, which in turn passes additional costs onto the consumer.

The Consumer Credit Council stated that this increase would translate to a rise in annual energy bills of roughly £268, or £255 a year for those with a prepayment meter. Although this is a significant figure, by employing effective budgeting and planning you can ensure that you remain financially resilient. Here are some factors to keep in mind while budgeting this winter.

  • Keep up to date meter readings

    It’s important to always keep up to date meter readings. This will ensure that you pay the correct amount each month. If you don’t have an up-to-date meter reading, your energy supplier will create an estimate on how much energy you’re using. This can have a significant impact on how much you end up paying. Consider integrating a smart meter into your home, which gives you full control over how much energy you are using.

  • Find out what tariff you are on

    There are two main types of tariffs to consider in the UK energy market, these are fixed tariffs and variable tariffs. Understanding the different tariffs and making an informed decision about which one is most suitable for your household can help you save a lot of money.

    A fixed tariff simply means that your unit price for gas and electricity is fixed, this means that it will not change for the duration of your plan. For instance, you might have a 12-month contract with a supplier, and you may pay £50.00 per month. On this fixed tariff, the price will not change for the full duration of the agreement. Keep in mind that once you are on a fixed tariff, you will have to pay a fee to exit early.

    On the other hand, a variable tariff means that your unit price for gas and electricity is variable, meaning that your costs can vary at the discretion of the supplier. This means that depending on wholesale energy prices, your monthly bill can go up or down, depending on market conditions. This may seem like a disadvantage, but the upside to having a variable tariff is that you can usually leave your agreement if you find a better deal elsewhere without paying an exit fee.

  • Shop around for the best deal?

    Currently, the price of wholesale energy is very high, and as a result a lot of smaller, more competitive energy suppliers have unfortunately gone out of business. This means that many suppliers are not currently offering fixed tariffs, instead they are sticking to variable tariffs to make sure they can stay in business. As a result, this means that shopping around for the best deal is not necessarily a good option now. You may consider sticking to the supplier that you are with currently until the market stabilises, as it’s unlikely that you will find a better deal right now.

  • Support is available if needed

    It’s important to note that there is support available if you are unable to make ends meet, especially for energy bills. We all need heating, especially during the winter, and of course we need electricity to keep our lives moving. If you find yourself struggling, it’s worth contacting the Citizens Advice Bureau, who have a dedicated portal for energy supply and can answer many frequently asked questions on the subject.

Prepare for the future

Although you may not be able to save a lot of money between now and Christmas this year, being ahead of the Christmas rush can help to stretch your existing budget. It’s also a great time to start saving up for next year. Why not learn more about how you can start saving with Serve and Protect CU today via: www.serveandprotectcu.co.uk/save

  • The information provided in this article is for guidance and educational purposes only. Police Credit Union Ltd. does not offer regulated financial advice. Please seek independent financial advice.

Your cookie preferences

We use cookies on our website to make your online experience better. Please see our cookie notice for further details or agree by clicking the 'Accept' button.

Your cookie settings

Below you can choose which kind of cookies you allow on this website. Click on the "Save cookie settings" button to apply your choice.

FunctionalOur website uses functional cookies. These cookies are necessary to let our website work.

AnalyticalOur website uses analytical cookies to make it possible to analyse our website and optimise for the purpose of usability.

Social mediaOur website places social media cookies to show you 3rd party content like YouTube and Facebook. These cookies may track your personal data.

AdvertisingOur website places advertising cookies to show you 3rd party advertisements based on your interests. These cookies may track your personal data.

OtherOur website places 3rd party cookies from other 3rd party services which aren't analytical, social media or advertising.