7.2m in fuel poverty as energy prices rise by 156% in 7 years

The impact on UK households of the big gas and electricity price rises from five of the “big six” utility suppliers who supply energy to 99 per cent of UK homes is that 314,000 more households face a winter of fuel poverty.

Fuel poverty is defined as when a household spend more than ten per cent of its net income on heating and powering their home. Analysts and consumer groups are concerned that the trend is set to continue as the cost of fuel rises as traditional supplies run out and the cost of transporting fuel rises and other costs add to the prices consumers have to pay.

The latest set of price increases means that there are now 7.2 million households in the UK that are living in fuel poverty. The total extra cost that the UK is paying as a nation is £753 million.

Energy prices have more than doubled in the last seven years from an average dual fuel energy bill of £522 in 2004, to a record £1,334 this winter. This is an astronomical rise of £812 or 156 per cent.

The cost of utilities is now the area that concerns households more than any other. 90 per cent of UK households say they worry about energy bills, more than double the number of people concerned about mortgage or rental payments at 40 per cent and higher than the number of people concerned about the increased cost of food (80 per cent) and petrol prices (75 per cent).

On average each household is paying seven per cent extra for energy this winter. This means that nine out of ten households plan to ration their energy use this winter, even many relatively well-off families who are not in fuel poverty.

Read more: The cheapest fixed rate energy deals for winter 2012 and 2013

Ann Robinson, Director of Consumer Policy at uSwitch.com, says: "The figures speak for themselves. Taking this winter's price hikes into account, the average household energy bill has rocketed by 156% since 2004.

"Because energy is such a basic need, you cannot have a winter price hike without casualties.”

EDF Energy was the last of the five main suppliers to announce price rises. EDF customers face a 10.8 per cent increase in the cost of gas and electricity from December 7th.

This follows British Gas putting up gas and electricity prices by 6 per cent, SSE by 9 per cent, Scottish Power by 7 per cent, and nPower put up gas by 8.8 per cent and electricity by 9.1 per cent.

E.On is the only supplier not to raise prices in this round of autumn hikes after promising that it will not increase prices in 2012.

Ann Robinson added: "The impact of higher energy prices on households is immense. People need to adjust quickly and there are two key steps to this - making sure we pay the lowest possible price for our energy and learning to use less of it by becoming energy efficient.

"With over £300 difference between the cheapest and most expensive energy tariffs on the market, plus low-cost or free insulation offers available, I would urge consumers to take action now."

Read more: The cheapest variable rate energy tariffs for winter 2012

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