The silver lining behind high energy bills

Changing your bank account is one of the most difficult decisions you’ll ever make as a consumer.

There is a certain 1950s-style myth structure surrounding bank accounts, which tells us that – contrary to all the evidence – the longer you’ve had your bank account at the same place, the more loyalty there is between you and your bank.

In fact, this is nonsense. The spotty 22 year old who runs your local high street branch is the reality of a modern day bank manager, and a plethora of ridiculous admin charges for things like using the overdraft you’re entitled to, or asking for copies of your own bank statements, are the reality when it comes to how loyal the bank is to you.

I found out how easy switching my bank account was, and how much better the alternative could be, when I changed to First Direct, which should really be paying me for this shameless punt. Compared with changing your energy supplier, for example, it’s a piece of cake.

I once changed my power supplier. It took me about 20 minutes, once I’d made up my mind, to call Scottish Power and sign up to their dual-fuel plan.

For a brief moment I was a participant in a brave new competitive world, paying less for my electricity and gas because I’d taken control of the situation as an informed consumer.

One year later, I was still wrangling with British Gas, and was paying my own gas bill and that of my neighbour upstairs in the converted house we shared. And more than a year later, you’d have found me trying to explain my objection to paying for other people’s electricity, while the nice lady at British Gas told me my house didn’t exist.

It wasn’t on some register that listed all the gas meters in the universe or something, and it never would be apparently because only the power company could inform the database that a new address existed, and they wouldn’t because my house wasn’t on the database so in their view it didn’t exist.

I got my own back some years later after living in a house for a year where my neighbour was in the barrel, and paid our water rate for the whole time we lived there, so swings and roundabouts and all that, but it would be safe to say, then, that I agree with MP Tim Yeo, chairman of the Energy and Climate Change Committee.

He told the BBC this week that "The process of trying to switch from one supplier to another is hideously complicated – very off-putting even for quite intelligent people."

So news that the profit margin for energy firms has risen from £15 per customer to £125 per customer since June is relevant, not only because it shows how much they’re being ripped off for basic utilities, but because there is an underlying truth that it pays to observe.

The likelihood of a double-dip recession is growing, and even in an environment of sluggish growth it is clear that consumer-driven companies – in this country at least – are in for a tough time.

This latest round of profits, however, shows that there are other firms that continue to perform regardless of the economic situation around them.

Power, water, food, petrol, alcohol and tobacco are essential to most of us, especially the latter two, and this will stay the same no matter how difficult the next few years are for the economy.

Given the sentiment and generic malaise affecting valuations in the FTSE 100, which houses most of the suppliers of the essentials listed above, and which has little relevance to how these individual companies perform, I will certainly be looking at what’s available in these fields when I next add a holding to my portfolio.

My injured pride, though, means it is unlikely to be British Gas.