The hi-tech solution to soaring energy costs bills
New technology will help households slash their gas bills, reports Gary Jones
Saturday 26 February 2011
The announcement of record profits on Thursday by Centrica, the owner of British Gas, prompted further anger among hard-up families who have just seen their energy bills increased by 7 per cent by the firm.
British Gas isn't the only villain, of course. Since December all the major suppliers have increased prices – by up to 9 per cent for electricity and 9.4 per cent for gas.
The energy watchdog, Ofgem, is not taking the latest increases lightly and is expected to insist on the introduction of a basic tariff in a report due in March which protects against unexpected price hikes. However the tariff is likely to be fixed at a higher rate than a lot of online deals.
It means the onus to cut bills falls back on consumers. There are several easy ways to cut electricity consumption. For instance, using devices to take TVs and home entertainment systems out of standby mode could save up to £40 a year – not bad for an average £12 investment. Computers, game consoles and even mobile phone chargers left on will cost the unwary consumer upwards of £60 a year. Switching off lights, using low-energy lighting and only boiling the water you need in a kettle are other ways of cutting bills.
But when it comes to gas the choice of energy-saving products is limited, even though the amount we spend on gas is substantially more than we do on electricity (£608 on the annual gas bill compared with £424 on electricity, according to Ofgem). The amount we're spending on gas is also climbing. Figures from the Department of Energy and Climate Change show expenditure on gas rose from 1.9 per cent to 2 per cent of consumers' expenditure in 2009, while spend on electricity climbed from 1.6 per cent to 1.7 per cent.
Loft and cavity wall insulation, and the installation of an energy-efficient boiler, can help reduce gas consumption but such improvements are expensive and only have long-term gain.
However, there are savings to be made. The most obvious starting point is to look at your bills: could you save money by switching to another supplier? Tom McLennan, head of switching at Which? says: "The most economical solution to switching is a dual fuel tariff tie-up between energy sources."
Ofgem has ruled that energy suppliers should provide a 12-month statement to help customers switch, however, only a third of people have claimed to have received one, with a large proportion of those claiming they were too complex. However, McLennan argues they remain important. "It's advisable to take a 12-month view as quite large cost distortions appear at both peaks if you take the summer low and winter highs. You should also pay by direct debit to reduce costs," he says.
Surprisingly, the solution to ever-growing gas bills could depend upon electricity – or, more acucrately, microgeneration. This involves householders installing technology that generates electricity to fulfil their own requirements, with any surplus electricity being sold on to the national grid generating 10p for every kilowatt-hour under the Government's Feed-In Tariff Scheme. The revenue can then be used to offset the household gas bill.
Such is the perceived importance of microgeneration that Sainsbury's has recently signed a five-year partnership with British Gas to sell such services to their customers.
Current technologies include combined heat and power (CHP) appliances such as boilers – which use heat wastage to generate electricity – wind turbines and solar panels. But with the latter costing upwards of £7,500 the investment is not cheap.
In June of this year the Renewable Heat Initiative will come into effect where consumers install renewable heat systems – for which grants are available – such as solar thermal panels, heat pumps or biomass (wood burning) boilers. An estimate is made about how much heat the renewable energy systems will produce and a fixed payment is then made based on that estimate.
"Renewables or microgeneration could be a good investment, with feed-in tariffs potentially generating 10-15 per cent tax free," says Adrian Wright of Enact Energy Renewables. "And while the costs could be added to a mortgage, it won't be long before large investment companies offer funding."
There are likely to be more finance deals appearing before the Government's proposed launch of its Green Deal in 2012. The ambitious project intends to give individuals the opportunity to spend up to £6,500 on improving the energy efficiency of their home, without means-testing or credit checking. On top of that the 'loan' will be passed onto the next owner should the house be sold.
Independent Partners; request a free guide on NISAs from Hargreaves Lansdown
- 2 Rihanna 'nude pictures' claims emerge on 4Chan as hacking scandal continues
- 3 Kim Kardashian 'nude photos' leaked on 4chan weeks after Jennifer Lawrence scandal
- 4 'F*ck it, I quit': KTVA reporter Charlo Greene quits live on air in spectacular fashion
- 5 Hitler’s former food taster reveals the horrors of the Wolf’s Lair
Scotland could still declare independence – even without referendum, says Alex Salmond
Scottish referendum results: Cross-party consensus collapses amid Tory-Labour spat on the 'English question'
Hilary Mantel 'should be investigated by police' over Margaret Thatcher assassination story, says Lord Bell
Scottish independence: David Cameron is becoming the 'George Bush of Britain'
Plebgate MP Andrew Mitchell called officer a 'little s**t', claim court documents 'exposing ex-Chief Whip's 'record of abusing police'
Archbishop of Canterbury admits doubts about existence of God
iJobs Money & Business
£65000 Per Annum Benefits + bonus: Clearwater People Solutions Ltd: If you are...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...
£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...
Day In a Page
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village
A secluded seven-bedroom detached house with large private garden, £490,000
A three-bedroom cottage overlooking Sarratt village green with open fires and solid oak floors
A three-bedroom maisonette flat in a Grade I-listed, Georgian townhouse in a sought-after location
A one-bedroom apartment located within a private gated development, north of Turnham Green