Energy News

E.ON cuts its electricity prices by just 9%

Friday 13 February, 2009

By becca.talbot@consumerchoices.co.uk

Energy giant E.ON has become the latest energy supplier to confirm plans to cut prices.

E.ON (www.eonenergy.com), which has 5.5million customers in the UK, said yesterday that it would cut average electricity prices by 9% from March 31, however its isn’t cutting its gas prices.

German-owned E.ON is the third of the “big six” energy suppliers to announce a cut to its tariffs, following reductions by British Gas and Scottish & Southern.

Graham Bartlett, managing director of E.ON’s retail business, said: “We’ll be reducing our electricity prices for millions of customers, while also having maintained one of the cheapest gas prices throughout the coldest winter in over a decade.”

Despite not cutting its gas prices, E.ON claims that on average, its gas prices remain cheaper than British Gas’ post-decrease prices*.

Bartlett continued: “We know our customers are facing difficult times and we are continuing to monitor the market to ensure the prices we offer our customers are as competitive as possible.”

E.ON said 4.1 million households would benefit from the electricity price reduction, however energy campaigners have complained the cut is too little too late.

Gordon Lishman, director general of Age Concern, said: “Cutting prices is the right move, but the current round of modest decreases being announced by energy suppliers will still leave many of the poorest pensioners struggling to pay their energy bills.”

The confirmation of price cuts came just a day after the energy giants were grilled by MPs on the Energy Select Committee.

Chris Eagle, commercial manager at EnergyChoices.co.uk said: “This 9% price cut is a huge disappointment. It’ll be two months before E.ON customers see any reduction in their bills, by which time the cold weather will be behind us. Coupled with the fact E.ON gas prices aren’t being cut, we’re just seeing a ‘me-too’ series of virtually worthless cuts.”

He suggests customers watch and wait for further price cuts before deciding to switch energy suppliers: “Knowing when is the right time to switch energy suppliers is important; you don’t want to get locked into a fixed rate tariff which is more expensive. Wait until more price cuts are announced, then compare energy prices.”

* E.ON is cheaper than British Gas on standard prices, based on an average across all regions at an average consumption of 20,500 kWh per annum, for customers paying monthly by direct debit. Bills may vary across products, regions and consumptions. Some customers may pay more.

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