Are Fuel Firms Ripping you off?

MP’s have come out this month in saying that they believe that fuel firms are ripping everybody off. Naturally this caught my attention and I wanted to find out, are fuel firms really ripping us all off?

I came across the news in the BBC and with the headline ‘MPs: Cash Payers are being ‘ripped off’ by energy firms’ naturally my interest was piqued. I decided to take a closer look and was surprised when the article provided a compelling argument.

Specifically MPs have accused energy bills of fleecing customers who choose not to pay their bills by direct debit. Government figures provide stark evidence that suggests that those who pay their energy bill by cash or cheque pay an extra £114 a year.

MPs this time are being quick to act on behalf of their constituents and 200 of them have now signed a House of Commons motion requesting that the energy sector regulator Ofgem conduct an enquiry into the matter.

The BBC’s Radio Five Live spoke to Conservative backbencher Robert Halfon on the matter. He said that "Energy companies have been ripping the consumer off - have been fleecing the consumer- particularly the poor and pensioners, with their stealth tax for some time." Halfon then suggested that he would like to see a cap of £2 a month (£24 per year) on charges, similar to those used by BT.

Whether any change will be made, we don’t know yet. However we have to deal with the reality. If you are paying your energy bills by cash or cheque you could be paying up to £114 a year. This is money that could be boosting your budget in much better places. So how can you deal with it?

First off, if you can, go on direct debit. There’s a reason why it’s cheaper and there’s no point holding out and wasting money on your energy bills if you absolutely don’t have to.

However there are other ways of dealing with the issue. You can look to use your energy more efficient; turn of lights when you’re not using them, only boil the water you need etc. as you are using less energy which will lower the bill. Or you can get energy efficiency measures such as a combi-boiler installed as they also cut down the energy bill.

The energy companies may be overcharging, but until a change of policy Kiran Trivedi readers, it’s just something you’re going to have to deal with.  This doesn’t mean you should let them take you for a ride though.