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Scottish Power cuts its PriceSure tariff by 10%
Monday 05 January, 2009
By becca.talbot@consumerchoices.co.uk
Energy giant Scottish Power has cut its fixed rate tariff PriceSure by 10%, following huge decreases in wholesale oil prices.
Scottish Power (www.scottishpower.co.uk) customers are expecting lower fuel bills, after the energy supplier cut the cost of its fixed rate tariff by 10% earlier today.
The reduced PriceSure tariff will mean the average annual household bill will drop by £81, from £1,210 to £1,129. Experts are now predicting price reductions of 10-15% from all energy suppliers in the coming months.
Will Marples, of uSwitch.com, said: “I expect suppliers to take a cautious approach to bringing household energy prices down. They will be concerned that wholesale prices could move upwards again, eating into margins and leaving them exposed.
“They are likely to opt to introduce cuts in two stages, making an initial reduction of 10–15% in the run up to spring 2009, followed by a second cut of a similar or smaller level later on in the year if wholesale prices remain low.”
Wholesale gas and electricity prices have collapsed from their 2008 peak of $147. A barrel of oil costs just $47 today.
Customers with the PriceSure tariff must pay by monthly direct debit, and if you want to change your provider or tariff, there is a £30 cancellation charge for electricity and £20 for gas. Both existing and new customers will benefit from the reduction, and the tariff prices will now be fixed until January 2011.
Maria Wardrobe, head of charity National Energy Action said: “As a period of cold weather sets in, we welcome Scottish Power’s announcement, particularly the fact that they will continue to monitor the wholesale market and pass on reduced energy prices in general as soon as possible.”
Wardrobe added: “I would urge vulnerable customers to contact Scottish Power to see if they are eligible for the social tariff the company announced before Christmas, which could offer even bigger savings.”
Chris Eagle, commercial manager at EnergyChoices.co.uk said: “While the thought of reducing your household’s annual fuel bill with a fixed-rate tariff may seem tempting, it’s important you compare energy prices to make sure you are on a competitive price plan, as you could save a lot more.”
He continued: “You should consider holding off switching straight away, with predictions that energy giants are soon to announce price reductions. However if you do switch energy suppliers ensure you don’t get locked into a long-term contract with exit fees to keep your options open.”
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