When the recession hit we all tightened our purse strings, cut back on luxuries and braced ourselves for rising costs and the difficult times. Saving money on meals at restaurants, visits to the cinema and how much we spend at the supermarket can all be monitored closely, however it’s far more difficult to monitor our gas and electricity useage.
During the winter months there were reports of elderly pensioners refusing to put the heating on in their house for fear they could not afford the bill. Now Uswitch.com has revealed that almost 4 million UK households are in debt to their gas and electricity supplier.
Each household is estimated to owe an average of £131, or £478million in total to their energy supplier.
A 17% increase on the cost of fuel which was introduced last year made the already difficult situation worse for millions of households in the UK.
Whilst the survey found 24% of people burying their heads in the sand about their energy debt problem the energy companies are making billions of pounds in profits. One energy supplier posted profits in the last year of £2.5billion.
As millions of people struggle to heat their homes it seems . Last week in America, a gas provider was fined $500,000 for price fixing, whilst in March 2012 another company received a $2million fine. Whilst in the UK energy companies are being fined for their complaints handling procedures, there have yet to be any fines imposed for price fixing as it has not been proven.
What to do If you owe money to energy suppliers
If you owe money to your energy supplier it is important you communicate over the telephone or in a letter. Explain to your energy company why you have not paid your bill and that you want to repay the outstanding amount. Failure to communicate can often result in energy companies placing a meter on your property and this has been proven to be a far more costly way to fuel your home.
The next step is to consider how much you can afford to pay towards your debt. The best way to do this is consider how much money you have coming in every month against how much is spent out on things like your mortgage/ rent, food, council tax etc. Next, agree with your energy supplier an affordable monthly amount to repay the outstanding debt.
If you owe several companies money and the debt is larger than the money owed to your energy supplier then you may wish to seek professional debt help from a registered charity. There are several debt solutions available for people struggling to manage their finances however the correct advice will depend on your personal and financial situation.
You can receive debt advice on 0800 085 0226.