Consumers Move Away From Uncapped Tariffs

With the latest round of energy hikes are released, people are rushing to get themselves themselves on fixed-price tariffs to dampen the effect of the savage cost rises, according to the Fair Investment Company.

The price comparison site warned that with additional price hikes predicted as the end of summer approaces, it is vital to get on a fixed-price product as rapidly as possible. It pointed out that whilst such tariffs are becoming more expensive, it might still be worth signing on to high-end rates as the large energy suppliers prime people for a further round of price rises. According to the group, the rate of energy price inflation has been so rapid that Ofgem and a governmental select committee have launched a joint investigation into whether or not the 'big six' providers have been collaborating to keep prices at unnecessarily high levels.

However, the Treasury is also considering plans to exercise a windfall tax on energy providers as reports of record-breaking profits continue to leak into the public domain. The Fair Investment Company pointed out that the last time such a levy was imposed was in 1997, when the funds extracted were used to offer support to hard-up people failing to keep their houses warm over winter.

Indeed, Sainsbury's Bank identifies that for many people, the cost of grabbing a summer deal will have to be paid for using credit as the rising price of fuel, food and energy have an impact. The company predicted that 42 per cent of all expenditure carried out in the coming months will be put on credit cards. Such a percentage would amount to about 3.29 billion pounds worth of purchases made using plastic.

For those who are facing a winter stuck on an expensive tariff, applying for one of the many cheap loans available might turn out a practical course of action. In going for this kind of loan, holidaymakers may discover they may well be able to pay off outstanding debts easily and switch to a provider offering a fixed-price product. Additionally, leftover cash provided by such a loan could be put to good use investing in energy saving appliances and home improvements with the intention of reducing dependence on energy as the winter months draw nearer.

Talking about the decision facing the Treasury, Steve Wagner, leading energy spokesperson for the company, said: "I agree with the government that something needs to be done. The recent increases are going to start hitting households just in time for the winter months and with millions of people already in fuel poverty this is only set to get worse. On Wednesday British Gas raised their tariffs for the second time in six months, putting their gas prices up by 35 per cent and electricity by nine per cent, making them the most expensive energy tariff on the market. We expect the other big energy providers to follow suit and raise their prices too."

As such, he urged consumers to cap their tariffs as soon as possible.

EDF was the first supplier to announce that it would be raising prices again, with 22 per cent and 17 per cent increases tagged on to their gas and electricity tariffs respectively.

As well as addressing concerns about soaring energy prices, a recently released independent study has additionally known as upon Whitehall to add to the level of protection it provides to homeowners living in flood risk areas. Sir Michael Pitt, who led the review, strongly recommended the government to implement a range of steps to limit risk exposure. There was concern that a large number of would be left unable to obtain insurance, meaning that they may well have to resort to savings or personal loans in order to fund the cost of repairs.