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Energy bills set to soar higher than inflation over next 2 years

Energy bills set to soar higher than inflation over next 2 years

Energy bills set to soar higher than inflation over next 2 years

Householders will find their energy bills continue to increase past the rate of inflation over the next two years, the Office for Budget Responsibility (OBR) has said.

A report from the body predicted that the rise in gas and electricity prices in 2013 will be "bigger than normal" due to a number of external factors.

"Some UK energy suppliers have pointed to increased distribution, network and environmental policy costs as well as wholesale energy cost pressures," the report stated.

"These network and environmental policy costs may persist in coming years, suggesting that further rises in retail gas and electricity prices may be likely in future."

The average annual energy bill for households has gone up by seven per cent (£94) this year alone, and by 23 per cent (£251) since the start of 2011. Within the last eight years, the average bill has risen by 159 per cent from £522 a year.

Ann Robinson, director of consumer policy at uSwitch, commented: "Affordability is becoming a huge and growing concern. The overall trend in household energy prices is up and consumers need to adapt quickly. The days of cheap energy are over.

"We expect further price increases next year and would not be surprised if households see increases of as much as 15 per cent in the next 18 months to two years."

If your household budget is going to struggle to meet these price hikes, it might be worth looking at what you can do to reduce your bills now. Installing LED lighting is one way to significantly slash electricity payments as the next generation of bulbs requires less energy to power them but emit a brighter beam than traditional incandescent bulbs.

Indeed, even Heathrow Airport has employed the technology to light its newly refurbished Terminal 4 building, having fitted more than 800 LED bulbs to the ceiling of its international departure lounge.

The bulbs can create more than 16 million colours and have now been turned on to produce a unique ambience for flyers.