Bills of the future

A look into the future cost of household energy bills

With the economic turmoil that the UK is currently facing, the rising cost of energy is on the minds of many in the United Kingdom. And with prices set to rise yet again in April 2023, people are sure to be highly concerned about the future costs of energy bills. 

One way that you can keep your energy bills from growing out of control is with regular boiler servicing. This is especially important, as if your boiler is not running optimally it can lead to an increase in energy usage and therefore costs. Or, instead, if you can afford to, it may be more beneficial to consider upgrading your boiler to a more energy efficient one. 

Below, we will be looking at how much electric and gas bills have increased in the last ten years. We will also look at how things have changed from our previous Bills of the Future research. Using this we will be able to estimate what energy bills could look like in the next ten years. Additionally, we have also looked at which appliances are the biggest drain on your energy bills. 

We looked at electricity bills from the last ten years, from 2013 to 2022, and we have found that on average there is a 10% year-on-year increase. This is a rather sizable increase from our last Bills of the Future, where it was just 4.8%. This is likely due to the increase in energy prices over the last year and the cost of living crisis. 

The government has calculated the average cost of electricity bills based on an average usage of 3,600 kWh. Comparatively, last year they were calculated based on a 3,800 kWh average usage. This is perhaps due to the government’s report that energy use has decreased by 10%, with ‘warmer temperatures than the previous year’ cited as the cause. 

If the UK average bill keeps increasing at its current rate, in the next five years, the average annual electricity bill could be £1,963. This is a huge increase from our previous five-year prediction of £968 and an indication that bills are increasing at such a rapid rate currently. 

And in ten years, at the current rate of increase, electricity bills could be £3,162 on average. This is an astronomical sum, especially compared to our previous prediction of £1,224.

We have combined the average UK electricity and gas bill to calculate the average household energy bill cost. 

The average household bills have seen an average annual increase of 9%, between 2013 to 2022. The biggest increase was a huge spike between 2021 and 2022, where we saw a 74% increase, coinciding with the increase in energy costs. 

The average British gas bill is currently calculated based on a standard consumption of 13,600 kWh, whereas pre-2020 it was based on 15,000 kWh. This could be due to the UK government’s perception of decreased energy consumption, due to the warmer weather compared to years prior. With the price caps due to rise again in April 2023, many may be concerned as to what their overall household energy bills could look like when paying both gas and electricity bills. 

If the average increase of 9% holds, by 2027 household bills could cost an average of £3,564 per year, more than £1,200 higher than the current average price in 2022. And by 2032 we estimate that the average household annual energy bill could cost around £5,484. Again, this is an astronomical increase compared to the 2022 average yearly cost of £2,316 for gas and electric bills combined.

Fully charging an electric vehicle

2022: £21.00 per charge

2032: £54.17 per charge

Charging an electric car battery in 2022, based on the average battery capacity of 60 kWh, costs approximately £21.00, and annually this would cost £777.00. These calculations assumed an average distance of 20 miles driven daily and the average battery getting you around 200 miles. As such, you’d need to recharge every 10 days, which works out to 37 times annually. 

We also looked at how the cost of electricity per kWh has changed from 2010 to 2022, currently it is at £0.34 per kWh. The ten year average price increase for electricity prices per kWh is 9.94%. Given that, if electricity increased at that rate for the next decade, it could cost £54.17 to fully charge your electric vehicle's battery. 

 

Drying your laundry

2022: £1.80 per load

2032: £4.63 per load

This may be the most convenient way to dry your clothes, especially during the wet and cold months of the year, but it is one of the largest contributors to your electricity bills. On average, it costs £1.80 per cycle, based on a 9kg dryer and the rate of £0.34 per kWh. 

However, if the current electric tariff of £0.34 per kWh continues to increase at its average of 9.94%, it could end up costing £4.63 for each load of washing you put through the dryer. 

Washing your clothes

2022: £1.10 per cycle

2032: £2.84 per cycle

A necessary cost as everyone needs clean clothing, however, your washing machine is one of the more costly appliances to run. At £1.10, based on a 90-minute cycle and the rate of 0.34 per kWh. This cost can be lowered by running a shorter cycle and reducing the temperature of the wash, if possible. 

However, if the price of electricity were to increase at the rate it has between 2010 and 2022, it could end up costing £2.84 for each wash cycle you do. This is more than double the current cost of 2022.

Using a dishwasher

2022: £0.89 per load

2032: £2.30 per load

Instead of manually doing the dishes, it’ll cost around £0.89 per 2-hour cycle, based on the rate of 0.34 kWh. Based on the average use of three times weekly, this costs around £139.23 annually. If you use a dishwasher, you should try to only do a cycle once you have a full load of dishes

With the current rate of increase in electricity prices over the last 10 years, by 2032 it could cost £2.30 for each load of dishes. 

Electric shower

2022: £0.50 per 10 minute shower

2032: £1.28 per 10 minute shower

Your daily shower costs you around £0.50 every ten minutes, which can stand to rise if multiple people shower. For one person, showering daily for 10 minutes, it’ll cost £180.91 annually. 

With electricity costs increasing by an average of 9.94% from 2013 to 2022, if that rate of increase holds it could cost £1.28 for your 10 minute shower. A couple of ways to reduce the cost are to take shorter showers or reduce the temperature a little. 

Leaving your TV on standby

2022: £0.10 per day

2032: £0.26 per day

While this cost doesn’t seem like a lot, it can add up as the year progresses. That 10 pence cost can reach £37.31 annually, for those who leave their TV on standby all day every day. At the current average rate of increase, by 2032, it could cost £0.26 daily to leave your TV on standby. 

To cut this cost, you should try to unplug your TV completely when not in use, instead of leaving it on standby.

Methodology

We wanted to look at the costs of energy bills in the UK to help estimate what the future cost of these bills might be.

To begin with, we looked at Government Annual Domestic Energy Bills tables 2.2.3 and 2.2.5 for electricity bills. We had to use table 2.2.3 for the 2022 average bill, based on the consumption level of 3,600 kWh. Table 2.2.5 was used for the data ranging from 2013-2021 and is also based on the consumption level of 3,600 kWh. 

Using these average bills, we were able to calculate the year-on-year price difference as a percentage. We then took the average price difference as a percentage and used that figure to calculate an estimation of electricity bills for 2023-2032. 

We then used the same Government Annual Domestic Energy Bills data, this time looking at table 2.3.3, to get the average gas bill for 2013-2022. 2013-2019 bills are based on the average consumption of 15,000 kWh and 2020-2022 are based on the average consumption of 13,600 kWh.

We then again calculated the average price increase as a percentage from 2013-2022, using the year-on-year price difference we again calculated for gas bills. Using the average price difference, we then calculated the estimated bills for 2023-2032. 

Finally, we repeated this process for overall bills, except we first added the average gas bill and average electricity bill for 2013-2022 to get the overall energy bill cost. Then using the same method, calculated the estimation of bills for 2023-2032. 

Additionally, we looked at a range of household appliances, using The Mirror, Pod Point and Eco Cost Savings. 

For the costs of the tumble dryer, dishwasher, washing machine and electric shower, we took the amount of energy used per use (varies by the appliance), then calculated the cost per use using the quoted £0.34 per kWh electricity cost. We then researched the average usage for those appliances to calculate how much it would cost to run them per year. 

For the TV cost, we took the average electricity usage for the year, and then calculated how much electricity it would use daily. We then used the rate of £0.34 per kWh, as quoted by Ofgem, to calculate how much it would cost, daily, weekly and yearly. 

And lastly, for the electric vehicle costs, we went off the average battery of an EV (60 kWh), multiplying it by £0.34 to calculate the average cost to fully charge an electric car battery. We then took the average distance an EV can travel before needing to recharge (200 miles), and the average distance travelled daily by a driver (20 miles) to calculate how often you’d need to recharge your vehicle (every ten days). From there, we calculated how many recharges you’d need to do annually to get the weekly and annual cost of charging an EV.