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npower customers faced with price rises
Monday 01 September, 2008
By becca.talbot@consumerchoices.co.uk
npower (www.npower.com), the UK’s fourth-largest energy provider, raised gas prices on Friday by 26% and electricity by 14%, meaning that its 6.6 million British customers will now pay an average £222 more for their annual household fuel bills.
Last week, energy companies’ npower and Scottish Power became the last of the ‘big six’ energy suppliers to raise their gas and electricity prices.
Like the other energy providers, npower is blaming the rises on huge increases in wholesale costs, which it claims have made its previous prices untenable.
Giuseppe Di Vita, managing director of npower, said: “I am sorry we’ve had to increase our prices, and we’ve made this decision extremely reluctantly, especially as household budgets are being squeezed so much at the moment. There is help available for people who can’t afford to pay their bills and we want our customers to get in touch if they’re worried.”
The average annual household dual fuel bill for an npower customer has increased from £1,056 to £1278. However, customers have seen a total rise of 41% or £370 since the start of the year.
The increases could push more people into fuel poverty, with five million households now predicted to spend more than 10% of their income on energy this year.
| “...household budgets are being squeezed so much at the moment...” |
Scottish Power (www.scottishpower.co.uk) also increased prices on Friday, raising gas bills by 34%, and electricity prices by 9%. This is the second-largest rise in gas prices after British Gas (www.britishgas.co.uk) increased its gas prices by 35% at the end of July. Scottish Power’s 1.2 million customers will now pay an average of £259 more a year, on their household energy bills.
Last month, E.ON (www.eonenergy.com), which has over 5.5 million British customers, said that it would increase prices by 16% for electricity and 26% for gas. Hours after the announcement, Scottish and Southern Energy, the second-biggest supplier in the UK, with more than 8.5 million customers, said that it was increasing the prices of its electricity and gas by 19.2% and 29.2%.
Consumer groups have condemned the companies and called for the Prime Minister to take action . Adam Scorer, director of campaigns at Energywatch [http://www.energywatch.org.uk/], said: “Six price rises from the ‘big six’ in just five weeks caps a miserable summer and highlights how the companies appear to act in step with each other.”
He continued: “The market clearly needs urgent reform. Electricity and gas regulator Ofgem’s probe into the market, on which much will depend, is due to report in September. It must be a trigger to action to restore competition. Coherent and proportionate action is needed to deal with this crisis.”
Industry regulator, Ofgem, is expected to publish a report into prices next month.
Chris Eagle, Financial Director of EnergyChoices.co.uk said of the price hikes: “The increases by npower and Scottish Power weren’t unexpected, however now that the last two ‘big six’ energy suppliers have raised their prices, it is the best time to compare the market and find out if you could save money by switching suppliers.”
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