Russian Gas Crisis Could Mean 'Nyet' to Price Cuts

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Confused.com warns that more money needs to be spent on UK infrastructure.

Confused.com warns that more money needs to be spent on UK infrastructure.

Gas is our most heavily used fuel, however, supplies are dependent on imports which currently accounts for over a third of all our gas. This means the UK relies heavily on a continuous supply from Europe and the current Russian supply crisis has driven up wholesale gas prices again, dashing hopes of the much anticipated price cut.

We currently import 39%(1) of our energy and within 10 years, this is set to rise to 56% as a third of electricity generating capacity will be lost.

Calls have been made for the Government to act swiftly and force the energy companies into investing in energy generation as nothing short of quick, decisive action from the Government will result in a disastrous energy crunch according to the Department for Business, Enterprise and Regulatory Reform2.

Gareth Kloet, head of utilities at Confused.com says:
"Whilst the UK only imports around 2-3% of its energy from Russia, the recent crisis highlights the need to secure our own supply capabilities, as almost 40% of our total supply is imported from Europe. It is difficult to understand how we can gain control of energy price fluctuations in the UK until we significantly reduce the amount of gas we import.

"We must cut the red tape on building renewable energy sources to make it easier for suppliers to generate more energy, and perhaps most of all we need to be willing to put our tax money to use as well as seeing an increase in the investment made by energy suppliers.

"No matter what happens to price fluctuations, the best way for consumers to keep costs to a minimum is to vote with their feet and switch to the best tariff in the market for their needs. There is a perception that switching gas and electricity providers is difficult and time consuming but as long as you know either how much you are currently paying or you know your actual consumption, with only a few clicks on the Confused.com website, you could make considerable savings."

Editors Notes
1 Department for Business Enterprise & Regulatory Reform. (2007). BERR Energy Flowchart. Retrieved December 16, 2008, from BERR: http://www.berr.gov.uk/files/file46984.pdf
2 "Generating capacity equivalent to nearly a third of current electricity demand will be made redundant by 2020. It will need to be replaced. We believe that in the current economic climate there is a high risk that the energy companies will not be able to raise the finance necessary to build this. It is the Government's job to ensure security of supply. Just as the Government has been quick to respond to the crisis in the banking sector, it must now take action to ensure investment in new capacity takes place as planned. A reasonable level of profit by the big energy suppliers will be a precondition of this investment taking place. The situation is now very serious and we believe that a simple trust in the market's ability to deliver without any intervention will see us facing an 'energy crunch' in the medium term. The social and economic consequences of such a 'crunch' would be disastrous." Department of Business, Enterprise and Regulatory Reform. (2008, December 10). Business and Enterprise - First Report. Retrieved December 15, 2008, from Parliment.uk: http://www.publications.parliament.uk/pa/cm200809/cmselect/cmberr/32/3202.htm

For further information please contact:
Press Office, Confused.com: 02920 434 398
Joanna Harte/ Karen Wagg, Polhill Communications: 020 7655 0550

About Confused.com:
Confused.com is one of the UK's biggest and most popular price comparison services. Launched in 2002, it generates over one million quotes per month. It has expanded its range of comparison products over the last couple of years to include car insurance, home insurance, travel insurance, pet insurance, van insurance, motorbike insurance, breakdown cover and energy, as well as financial services products including credit cards, loans, mortgages and life insurance.

Confused.com has all of the 'big six' energy providers on its panel, customers can save £284* on their annual energy bill by switching with Confused.com

Confused.com is not a supplier, insurance company or broker. It provides a free, objective and unbiased comparison service. By using cutting-edge technology, it has developed a series of intelligent web-based solutions that evaluate a number of risk factors to help customers with their decision-making, subsequently finding them great deals on a wide-range of insurance products, financial services, utilities and more. Confused.com's service is based on the most up-to-date information provided by UK suppliers and industry regulators.

Confused.com is owned by the Admiral Group plc. Admiral listed on the London Stock Exchange in September 2004. Confused.com is regulated by the FSA.

*20% of customers saved £284 when switching with Confused.com between January and June 2008

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