Preparing for the £700 energy bill hike

On Friday April 1 people on a standard variable rate tariff will see their bills increase by 54pc, which will result in average households paying £700 more for gas and electricity.

Charities have warned that the price rise will push more into fuel poverty, but it's not just those on the lowest incomes who are facing difficult choices as families who are normally financially comfortable are also bracing themselves the hit.

Self employed Helen Oldfield is looking to cut back her family's energy usage to cope with energy price cap rise (Image: © 2020 Simply C Photography / Cherry Beesley)

Helen Oldfield, who is self-employed and works as a PR and communications manager at the charity Norfolk Community Advice Network (NCAN) revealed that her family's energy bills are set to go up from £168 to £250 a month.

Mrs Oldfield lives in a regular three-bedroom semi-detached house with her husband and grown up daughter, said: "When we got the alerts from our energy company about what our bills would be, for the first time ever, we had a conversation as a family about how we are going to need to use fuel differently from this point onwards and what that actually looked like for our family.

"This included things like we're only going to fill up the car once a month with petrol so that means our daughter will have to walk into town to see her mates and do her shopping, or hop onto the local bus, because fuel is so ridiculously expensive to fill the car.

"In the house it means things like all the lamps are just going to come off and we're going to stick with main lights. We're going to turn off unnecessary devices that are currently on standby throughout the house. We're going to not be constantly draining the water tank having hot baths every day, but take short showers instead.

"We're just going to put the washing machine on only when we've got a genuine full load and we will be turning the heating down by one degrees immediately and we will turn off radiators in rooms where we're not actually sitting.

"We're going to do all of those measures because it really is that serious the cost of fuel increases that we're anticipating."

Mrs Oldfield, who is in her 50s, revealed that extended family members are also having to rethink their budgets in preparation for the price cap hike.

She said: "My mum who is in her 80s was excited about having squirreled away a modest sum - but a lot for her in terms of how much it represents of her entire income, she’d squirreled away over the last year this sum that she had wanted to give to my daughter on her 21st birthday.

"My brother who generally looks after her paperwork with her, he said 'hang on mum you’re probably going to need to put a chunk aside as bills are going to go up from April quite a lot' and she was really disappointed.

"Even though she’s a great budgeter, she’s always managed her budget and lived within her means exceptionally well, I just thought that was quite sad that there’s a woman in her 80s who worked so hard couldn’t give her granddaughter everything that she had hoped to give her on her 21st birthday."

Along with the price cap rise, families are also facing a number of increasing costs from April including paying higher National Insurance, which will see their take home pay fall. Meanwhile, inflation has skyrocketed over the last few months, pushing up the prices of everyday essentials including food.

The Russian invasion of Ukraine has also impacted the economy, most notably by hiking up the price of oil, which has seen the cost of fuel at the petrol pump soar.

The government has announced some policies to help households cope with rising costs, which includes a £150 council tax rebate in April and fuel duty cut by 5p per litre, but opposition MPs and some finance experts warn this won't go far enough to help working families.

The energy price increase will see those struggling to make ends meet pushed further into financial crisis with Norwich Food Bank already finding that more people are coming to them needing help.

Hannah Worsley, project manager at Norwich Food Bank, said: "People are already struggling and the price cap increase is going to push people who were just about managing, not struggling yet but they're not far from it, that will push them into the category of them needing to come to us or to other charities for further support."

Along with providing food and essential supplies, food banks also run fuel banks that can help those struggling to meet their energy costs.

Mrs Worsley added: "A lot of people that we’re supporting are on pre-payment meters they’re already paying a premium for energy and so that price cap rise is going to hit them even harder and they’re usually the people who have less to start with so that’s the concern."

For those really struggling to pay their energy bills Mrs Worsely recommends that they visit the Norwich Food Bank website where there is a list of different agencies that can refer those in need to the Bank to receive help with their fuel.

Meanwhile, for families who are able to meet rising costs but worried about the financial impact, Mrs Oldfield, who has a background in working for debt and personal finance charities, said: "The first thing anyone needs to do is write a list of all your known fixed income sources and then all your known expenses and, by known expenses, I mean don’t guess it, dig out the last years worth of bills and average it out per month.

"Do a list income and expenditure and just see if that does leave you with any, does that allow you to cover all your known expenses with the income you’ve got guaranteed coming in and if it looks dicey or a close call or if it looks like it’s just not possible it might be very useful for them to seek advice from one of NCANs' hundred plus quality assured free advice agencies."

How to save money on your energy bills

Households without a smart meter were encouraged to take a meter reading and, ideally a photo of their meter, before the price cap rise on April 1 to ensure that they only pay the higher price on energy used after this date.

Although a smart meter will not reduce bills, they can be a good way to keep track of how much energy is being used and will prevent getting estimated bills, which are often higher than accurate meter readings.

As well as this, where possible homeowners should look to ensure that their houses are properly insulated by adding loft insulation and excluding drafts.

Small changes to habits, such as not leaving devices on standby, turning off unnecessary lights and turning down radiators by one degrees can all help to reduce the amount of energy used.