The Energy Advice Line has urged caution following the release of new consumer data showing falling energy bills have caused consumers to feel “their richest in four years”.
Julian Morgan, managing director of the price comparison, switching and advice service, said bills were down but many fixed-term contracts were about to expire and consumers could be flipped to more expensive standard tariffs.
“If consumers don’t shop around now and switch, they could find themselves automatically rolled over onto deals that are actually quite expensive, and this applies to households as well as business energy users,” Mr Morgan said.
“Plummeting world oil prices have contributed to Britain experiencing deflation and lower energy bills, but it’s unlikely to last. Consumers need to bear in mind that energy prices are volatile and the general curve is still upward.”
Lloyds Bank monthly consumer outlook index found that year-on-year spending on energy bills had fallen by 7.2%, while fuel spending had also plunged by 9.4%.
As a result, more people were left feeling flush in March, as the number of consumers who said they had money to spare after bills were paid increased.
But Mr Morgan said plummeting gas and electricity prices in the second half of 2014 had started to level out, and that tariffs might not get much cheaper than they are now.
More than a dozen tariffs are due to expire at the end of summer, including those from British Gas, Scottish Power, Npower, M&S Energy, First:Utility and Sainsbury’s Energy.
“After that, unless they switch supplier, consumers will be flipped to the standard rate and the real question is what will happen to these prices. Consumers need to watch out,” Mr Morgan said.
“Estimates vary, but some analysts predict consumers who find themselves on these standard tariffs could end up paying 5-6 per cent more than they were on their fixed deal.
“The important thing to remember is that it’s easy to avoid this by simply shopping around. Use a reliable, independent price comparison and switching service like the Energy Advice Line to do the legwork.
“Failing to do this means you could end up paying more than you need to, and that makes no financial sense at all.”
The Energy Advice Line is a consumer champion and an independent price comparison and switching service for householders and small and medium-sized businesses. The service enables consumers to quickly and simply compare electricity and gas prices, and to switch to the best available deal on the market.
The service also offers free advice and a contract management service, including alerts to remind business consumers users when their fixed-term energy contracts are about to end.
For further information, visit www.energyadviceline.org.uk