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Electricity-only customers to see bills rise by £228 by 2020

People who heat their homes using electricity could see their bills rise by as much as £228 a year by 2020, the watchdog Consumer Futures has said.

It is estimated within seven years, 11 per cent of UK households will be powered solely by electricity. However, while these will pay for 19 per cent of the government's low carbon schemes, they will receive just seven per cent of benefits.

Consumer Futures says that the two groups of people hit worst by this situation are pensioners and those living in purpose-built flats.

While electricity-only customers are set to be hit with a hike of £228, other homeowners are predicted to see their bills fall by £31 a year.

However, that figure is still way short of the £166 previously estimated by the Department of Energy and Climate Change (DECC).

"Most of the  government's policies, such as the Renewables Obligation and EU Emissions Trading Scheme, are funded through electricity bills. That means that households with electric heating will face a disproportionate share of the costs," said Adam Scorer, Consumer Futures director of policy.

"Many will be protected from such costs by benefits such as energy efficiency, microgeneration technology and bill discounts. But for those who are not protected, the impact on their bills will be significant."

He added that the best way to protect against high energy bills is to take measures which improve efficiency.

One such method is installing cavity wall and loft insulation. Home value and sales website described insulation as being the "single most effective way of slashing bills".

Despite this, figures published by the Cavity Insulation Guarantee Agency in May showed that the number of homes fitting insulation dropped to just 1,138 during the previous month. This was attributed to a lack of understanding of how the government's Green Deal works.

Posted by Helen Hughes