Energy News

npower increases prices

Friday 4 January, 2008

Energy supplier npower is set to announce significant gas and electricity price hikes.

Over six million customers on npower’s standard tariff will bare the brunt of this move which constitutes an average increase of 17.2% for gas and 12.7% for electricity, and more people could be affected if npower’s competitors follow suit.

This will be the second price rise by npower in just a few weeks, following the announcement in December that new online customers would be subject to a 17% increase on the previously offered tariff. npower cite higher wholesale energy bills and the current exorbitant price of crude oil as the reasons behind these anticipated increases.

What does is it mean for me?

The steepness of the price hike will depend on your region. The maximum increase for gas will be 23.8%, although the average is 17.2%. And the maximum increase for electricity will be 27.1% with an average rise of 12.7%.

These increases will come into play on January 5th.

The likelihood of the market following npower’s lead is strong, so the implications for the consumer are that energy bills will rise sharply in the early section of 2008 for everyone. The energy market looks set to be a difficult environment this coming year.

What should I do now?

The knee-jerk reaction to immediately switch supplier is understandably strong, but you should resist the urge and take a watching brief. With npower’s competitors likely to increase prices in line with the anticipated 15% rise, you could find yourself jumping from the frying pan into the fire.

Chris Eagle, commercial manager at EnergyChoices.co.uk, urges you to follow the market carefully:

"This is likely to be the first of many increases in the energy market. At this stage, British Gas (www.britishgas.co.uk) is still the cheapest provider in the market place via its Click Energy 4 tariff, but customers should wait and see what happens when the dust has settled in a month or so."

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