It’s undeniable that the price of electricity has gone up exponentially in the last few years. In the United Kingdom, consumers are spending 2.5x more on electricity in 2022 than they were at the same time in 2021.

What are the influences on the cost of electricity, and how can you minimise your energy spending? These questions and alternate options for energy generation will all be discussed below.

What Influences The Cost Of Electricity?

The electricity cost per kWh that determines your monthly bills is dependent on the national pricing of electricity. This is a standard amount that is the same across the country and is the base cost each individual pays for their electricity.

An individual’s personal energy usage will also vary, and so will the cost per month. For a family of four, the average usage is approximately 360 kWh per month.

What the chosen electricity provider charges for each kWh varies according to a number of factors; the generation capacity of power plants, electricity demand, cost of fuel and socio-political circumstances in the country.

How To Minimise Individual Spending On Electricity

There are a number of suggested ways to minimise what a household spends on electricity in a month. Some of the more practical options include getting a smart meter for your home, changing suppliers and exploring other options for energy creation.

What is a smart meter?

A smart meter will monitor your energy use in real-time and allow a household to keep tabs on its electricity use. Some electricity providers even offer rewards when less energy is used during certain hours, which a smart meter helps to keep track of.

By using a smart meter, households will easily be able to keep track of their spending, so they aren’t blindsided by the bill they get at the end of the month.

How do I change suppliers?

Finding the cheapest energy and gas provider is made simple with comparison sites. The following information would be beneficial to have when looking to change suppliers;

• Current postcode
• Current supplier
• An average annual energy usage or cost

Switching should be a simple process and should require little work from the individual. Once the new contract has been signed with a new supplier, consumers will only have to wait approximately a week to be swapped to their new supplier of choice.

Alternate Energy Production

Some of the most promising sources of renewable energy being used across the UK at the moment include wind, solar, and hydroelectric electricity. These options are not available to everyone as they are all determined by location, access, and initial costs.

The start-up cost of having a household converted into renewable energy makes it a difficult and costly exercise that most households cannot afford.

Why Has the Cost of Electricity Risen?

There are many factors at play as to why the cost of electricity has gotten so high in recent times. One of the main issues is the cost of importing, which has risen aggressively in recent months, largely due to having imports from Russia limited since February.

Prices have also been skyrocketing since economies have been developing again and recovering from the toll that the lockdown took on industries and trade.

Britain also has very little capacity to store gas and raw resources to create energy, meaning that the government is constantly having to buy and import these resources. If the country had the ability to stockpile these resources, there is a greater chance of the prices staying stable over longer periods of time.

How Much Will Households Spend on Electricity in 2022?

By October this year, electricity will cost 52 p/kWh or around £2735.61 for a family of four in one year; £227.97 per month. That’s spending more than the average salary in the UK for one month on electricity over a year.

Final Thoughts

The cost of living across the UK is getting higher every year, and this can be scary when the basic income doesn’t match inflation. When looking at the latest price of electricity, it’s easy to become overwhelmed by the prospect of paying such high prices.

Thankfully, there are options available to every UK citizen to find the cheapest energy and make the price hikes easier to deal with.

Reference List:

1. https://www.greenenergyuk.com/
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