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cashinmattress

Energy Bills ‘Could Overtake Mortgages In Five Years’

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Energy bills are rising so steeply that they could overtake mortgage repayments in parts of Britain in just five years’ time, the chief executive of supplier, First Utility, has claimed.

Ian McCaig issued the stark warning as he said energy policies must be reviewed to minimise the impact on bills and said consumers should think about turning down their heating to reduce costs. Critics have said that the Government’s environmental policies on windfarms and energy efficiency schemes, for example, are adding unnecessarily to the cost of bills.

“If things continue as they are, or even get worse, for some consumers in some parts of the country we will see energy bills overtake many other bills we have traditionally thought were the biggest items of non-discretionary spend,” Mr McCaig said.

“In fact, given that interest rates are low and look like staying that way it could easily be the case that over the next five to 10 years we’ll see energy bills even overtake mortgage costs for some consumers.”

Analysis by First Utility shows that UK dual-fuel bills have risen by an average of 8.5pc a year over the last five years to reach current levels of £1,420.

If they keep rising at the same rate, then by 2025 they would reach £3,761 – higher than current average annual mortgage repayments in places such as Stoke-on-Trent and higher than average repayments in Liverpool by 2029.

In Norwich and Birmingham, energy bills will outstrip mortgages of £5,100 and £4,990 a year respectively by May 2030.

Mr McCaig said First Utility has an “entirely different mindset” from other suppliers because “it wants consumers to actually use less energy”.

“People use heating really inefficiently,” he said. “We want to use consumption data to help customers use less.” He said he believed consumers could save 5pc to 20pc of their heating bills “just by being cleverer and not running the house hot”.

“When did we all start thinking it was all right to walk around our houses in the middle of winter with our shorts and T-shirts on? When did that become a sensible activity?” he said.

He said customers could save money by turning down their heating. “You have to be able to say, 'Making that choice, this is how much that costs you’,” he said.

He stressed that he was not suggesting people should go back to being “huddled together” for warmth, and recognised that there were consumers in fuel poverty who could not just turn down their heating.

First Utility, which has about 125,000 customers, said last month it was raising its leading tariff by 18pc, citing a series of rising costs outside its control.

There is widespread agreement that energy bills will rise significantly to pay for hundreds of billions of pounds of new power plants Britain needs, but estimates vary as to how much.

Government figures suggest household energy bills will be about £76 higher by 2020. However, the official figures assume major reduction in energy consumption as a result of schemes such as the Green Deal scheme offering households loans to make homes more efficient.

“The Government is saying the impact of [added costs] will be alleviated by the measures that are being implemented to make the housing stock more efficient. It’s a big ask,” Mr McCaig said, describing the interest rate for the Green Deal as “pretty high” and suggesting alternative schemes may be needed. He also said the “archaic” energy market required reform as it was “not competitive enough” and left consumers paying too much.

“Bills are going up and there’s a bunch of stuff that can be done at a macro level to mitigate the impact of that. But, at the end, consumers are going to have to focus on the fact that maybe behaviours are going to have to change.”

Keep on arguing about houses and glaze over the more onerous fact that energy companies are abusing you more blatantly than the banks.

Costs of heating and energising modern life will continue to rise, and in due time, house prices will drop significantly down the list of concerns on forums such as this because you will be freezing your butt off.

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This is why collapse in complex societies happens. There are too many demands on income.

However one way out is if people can create there own energy ie efficient solar panels / every house with a wind turbine etc... As prices keep going up other alternatives become economically viable.

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Keep on arguing about houses and glaze over the more onerous fact that energy companies are abusing you more blatantly than the banks.

Don't think that is quite right - at least the energy companues are providing something, the banks do not have the money they lend out, they make us as much as they can to strangle your finances and embellish theirs until the point of collapse, then the go squealing to governmetn to steal some more to fill the holes in their accounts.

Also monteary policy, devaluation and governmen/central bank mismanadement are largely reposnsible for crashed sterling and increased imported enegery costs.

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No problem - I'm sure that the banks can issue 'energy mortgages' and then electricity, gas and heating oil consumers can sit back and gloat as prices go through the roof.

And if prices get too expensive, the BoE can always magic up a few extra hundred billion quid of QE to 'help' people pay the prices.

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No problem - I'm sure that the banks can issue 'energy mortgages' and then electricity, gas and heating oil consumers can sit back and gloat as prices go through the roof.

And if prices get too expensive, the BoE can always magic up a few extra hundred billion quid of QE to 'help' people pay the prices.

The energy companies could put a floating charge on the house....meaning they will finally end up owning the house they spent years heating. ;)

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Don't think that is quite right - at least the energy companues are providing something, the banks do not have the money they lend out, they make us as much as they can to strangle your finances and embellish theirs until the point of collapse, then the go squealing to governmetn to steal some more to fill the holes in their accounts.

Also monteary policy, devaluation and governmen/central bank mismanadement are largely reposnsible for crashed sterling and increased imported enegery costs.

Look at the profit margins. Energy companies margins historically dwarf banks and all others.

Banks can also create 'money' to oblivion... energy, at least in the traditional sense from traditional sources as is used by us folks, is finite.

What that means is that the value of and supply money is subject to whim whereas energy can only become more scares and go up in value.

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Oh lookee, a torygraph link.

Remind me, what energy issues has the torygraph been campaigning on for years, printing stories ranging indiscriminately from good points through regular nimbyism to the blatantly disingenuous and downright lies?

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Keep on arguing about houses and glaze over the more onerous fact that energy companies are abusing you more blatantly than the banks.

OK thanks, can you provide a complete list of topics that are allowable on this forum just so we dont accidentally discuss something you dont approve of. Cheers.

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  • 245 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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