Cash-strapped households will have to wait until after the heavy consumption winter months to benefit from the recent falls in wholesale gas prices.
The wholesale gas market closely follows moves in world oil prices, which have fallen by more than 50% since their summer peak.
However, it may take up to six months for these savings to be passed on to consumers.
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SSE first to talk of cuts
Scottish & Southern Energy (SSE) is the only supplier so far to even mention possible cuts to its tariffs, and even then it says it will only be early next year.
“If wholesale prices for electricity and gas maintain a downward trend, SSE is optimistic that it will be able to deliver reduction in prices for domestic customers during the early part of 2009,” the supplier announced this week.
It remains to be seen how much of a cut households can expect, but price comparison site EnergyShop.com believes annual bills will be around £100 cheaper come next spring.
"Falls in global energy prices have taken UK wholesale gas and electricity back to a level that finally indicates cuts in domestic energy bills are on the cards,” site founder Joe Malinowski is quoted as saying. “At current wholesale prices we can look forward to standard energy bills around £100 lower in the spring of 2009 compared with current levels.”
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Minimise the winter hikes
This means households will be left paying record high prices for their gas and electricity during the winter months.
To minimise the impact this will have on your wallet, there are a few simple steps you can take. Switching energy suppliers is a good place to start, as not only will it save you money, but it will also send a clear message to your supplier that you aren’t willing to put up with their prices.
Unfortunately, with suppliers changing their tariffs so often, this does not always result in a long term savings. The best way to achieve this is to ensure you choose a supplier’s online tariff (rather than the standard tariff) and pay by direct debit.
Insulation is another handy cost saving initiative. The cost of fitting loft or wall insulation has not increased dramatically in recent years, but the sky-rocketing cost of energy means the potential savings have.
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