21/07/11
By Naphtalia Loderick
Scottish and Southern Energy (SSE) customers face higher gas and electricity bills after the firm announced price rises.
Gas customers will be hit with an 18 per cent rise and the price of electricity will soar by 11 per cent from 14 September.
The price hikes will affect 5.2 million electricity customers and around 3.6 million household gas customers in the UK, and will see a typical annual dual fuel bill rise by £171 to £1,265.
SSE, which owns Swalec, Southern Electric, Atlantic and Scottish Hydro, is now the third supplier to announce new energy price rises.
British Gas announced price rises earlier this month, and Scottish Power was the first of the UK’s big six energy firms to announce price hikes in June.
Energy firms blame increased costs
The energy firms have blamed an increase in the cost of wholesale gas – the amount they pay for energy – for customer price hikes.
In a statement, SSE said: “The wholesale cost of electricity and gas has gone up by around 23 per cent and around 40 per cent respectively since SSE last announced a price increase for household gas.
“Events such as the earthquake and tsunami in Japan and political upheaval in the Middle East, and longer-term trends such as the fast-increasing energy needs of the Asian economies, have contributed to the rise in wholesale energy prices.“
Fuel poverty
Industry watchdog Consumer Focus said the increase will result in an increase in the number of households in fuel poverty.
Figures released last week showed a 1m increase in fuel poverty households – households that spend more than 10 per cent of its income on keeping warm.
Mike O’Connor, Chief Executive of Consumer Focus, said: “Knowing another price rise was round the corner will not soften its impact for customers.
“This increase heaps more pressure onto already cash-strapped consumers and will tip many thousands more people into fuel poverty.
“Currently consumers cannot tell whether these increases are justified and that stokes the lack of trust in energy firms.
“Suppliers point to rising wholesale costs. Yet although wholesale prices have risen recently, they remain around a third lower than their 2008 peak.”
Consumer Focus called on energy regulator Ofgem to investigate whether gas and electricity prices are fair.
Benefit of fixed tariffs
Lisa Greenfield, energy analyst at Confused.com said consumers worried about price rises should act now.
“If you’re concerned about the rising cost of energy, we recommend opting for a fixing or capped tariff which will give you security against any further hikes. We’d also advise paying by direct debit and managing your account online.”
Currently EDF’s Fixed S@ver V2 tariff is topping the best buy table with an average UK bill of £1,009 a year.
Insulation offers
Greenfield also advised consumers to take advantage of some of the subsidised insulation deals currently being offered by energy firms.
Poorly insulated homes cost more to run as they require more heat, more frequently, to keep them at comfortable temperatures.
According to the Energy Saving Trust, 33 per cent of heat is lost through walls and 25 per cent is lost through the roof.
