Five million homes face 'shock' energy bill rise

[dutchman]

Five million households face increases in their fuel bills of up to £100-a-year despite rising profits for energy companies.



SSE, the UK’s second biggest energy company after British Gas, said that from mid-October the price of an average annual dual fuel bill will rise from £1,172 to £1,274. Other companies are expected to follow suit

It came as Ofgem, the energy regulator, said the profit margins of profit companies were due to rise by almost 14 per cent.

Consumer groups and MPs said that the “shock” above-inflation rise will condemn cash-strapped families to a “winter of misery”.

The £102 increase will hit 3.3 million dual fuel households, while a further 1.7 million homes will also see sharp rises in their bills.

SSE said that it is “regrettably” raising the cost of gas and electricity by 9 per cent because of the rising cost of energy on the wholesale markets and increasing green taxes from the Government.

However the company’s announcement came as Ofgem, the regulator, said that the annual profit margins of Britain’s energy companies are likely to rise from £35 per customer currently to £40 by the end of November.

MPs accused SSE of profiteering.

“They are simply taking advantage of their customers,” said John Robertson MP, a member of the Energy and Climate Change committee.

Observers speculated that other energy companies could also raise their prices as the autumn approaches.

The price rise is a “hard blow” for consumers, said Audrey Gallacher, director of energy at Consumer Focus.

She said that people will be worried about “a run” of price rises by other energy companies. However there is “little evidence” that all suppliers need to follow suit.

Tom Greatrex, the shadow energy minister, said that hard-pressed families will be “astonished” by the increase.

“Unless ministers get to grips with spiraling energy bills, people will rightly think that this Government is completely out of touch with families and pensioners struggling to make ends meet,” he said.

Mr Robertson said that SSE, which made profits of £1.3 billion last year, was “irresponsible” for putting up its prices.

He said: “The fact is SSE energy barons have irresponsibly hiked its prices yet again, while lining their pockets with inconceivably huge amounts in profits.

“This Tory-led government needs to start putting people before business and do something about it.”

A spokesman for the Department of Energy and Climate Change said that the price hike is “obviously disappointing news for SSE customers”.

However he said that it is up to individual energy companies to explain their prices to their customers.

He said the price rise is “further evidence of the fact that world gas prices are the primary force driving up our energy bills”.

Richard Lloyd, executive director at Which?, called on the Government and Ofcom to reform the “broken” energy market. He said that prices need to be “properly transparent” and tariffs simpler.

Mark Todd, a director at Energyhelpline.com, described SSE’s rise as a “total shock”.

“A nine per cent increase is more than three times the price cut that SSE implemented last winter. Sadly, it seems that the energy market is back to its old ways of tiny price cuts followed by big price hikes.”

Figures from Uswitch.com, the website, show that last winter over eight in ten households were forced to ration their energy use because of the high cost.

[dutchman]

Figures from Uswitch.com, the website, show that last winter over eight in ten households were forced to ration their energy use because of the high cost.

Cutting energy use doesn't cut bills by the same amount due to a)the way heating systems work and b)the way bills are calculated.

Heating systems use most energy when first turned-on, so switching heating off to save energy has the exact opposite effect. Also, the first few units of energy are charged at much higher rate than the remainder so using fewer units saves hardly any money at all. In addition to that, standing charges remain the same no matter how little energy you use and are actually increased if you use mainly off-peak electricity!

[rebbonk]

.... people will rightly think that this Government is completely out of touch...

You mean they're not? This government is a one trick pony, and it knows it; hence the attitude we're seeing from the "arrogant little posh boys!"

[Spuffler]

“Unless ministers get to grips with spiraling energy bills," Why would they do that,when they're probably on the boards or shareholders in the companies that are ripping us all off?