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Npower electricity and gas price rises will add £109 to typical bill Npower electricity and gas price rises will add £109 to typical bill
(about 2 hours later)
Npower is hiking prices for more than a million customers who will see their dual fuel bill rise by an average of 9.8% or £109 a year. Npower is hiking prices for more than a million customers who will see their dual fuel bill rise by an average of 9.8% or £109 a year, in a move that has prompted widespread anger among consumer groups.
The “big six” energy provider said the rise would affect about half of its customers, or 1.4 million people. From 16 March, npower will raise electricity prices by an average of 15% and gas prices by 4.8%. The “big six” energy provider said the rise would affect about half of its customers, or 1.4 million households. From 16 March, npower will raise electricity prices by an average of 15% and gas prices by 4.8%.
The company blamed the rise on increases in wholesale gas and electricity costs and the cost of delivering government policies, such as smart metering and subsidies for renewable energy.
Simon Stacey, the company’s managing director of domestic markets, said: “This is a hugely difficult decision, and we’ve delayed the date this takes effect until after the coldest months of the year. We’ve also made sure that our most vulnerable customers won’t see any impact until May.”Simon Stacey, the company’s managing director of domestic markets, said: “This is a hugely difficult decision, and we’ve delayed the date this takes effect until after the coldest months of the year. We’ve also made sure that our most vulnerable customers won’t see any impact until May.”
Stephen Murray, energy expert at the price comparison website MoneySuperMarket, said it was a “hefty rise” that would make “a significant dent to customers’ wallets”. Consumer groups said the move would put further pressure on household finances and urged energy customers to shop around to get a cheaper deal.
“Standard customers continue to pay over the odds for their gas and electricity and whether you’re an npower customer or with any other supplier on a standard tariff, the message is and has been clear for a while – switch tariff to a cheaper fixed deal and take control of your energy bills.” With average household bills for npower’s dual fuel customers set to go up from £1,077 to £1,187 a year, Claire Osborne, energy expert at the price comparison website uSwitch, said the move was a “bitter blow” for consumers.
The editor-in-chief of money.co.uk, Hannah Maundrell, said: “These price hikes are a big shock to the system for customers and seem really unfair. If you’re with Npower it’s definitely time to look elsewhere and switch if you’d be better off. “This price rise – the largest single rise from a big six supplier since 2013 - is a bitter blow for consumers who have just come out of a very chilly winter,” she said.
“This is a slap in the face for many already struggling families. It’s is a stark reminder that we all need to be tightening our purse strings to cope with price rises and looking where we can make savings. Make a budget and stick to it like glue. Review all your outgoings and haggle – there are always savings to be had.” “Npower has blamed the rise on the increased cost of buying energy in global markets – but they weren’t so quick to reduce energy bills when wholesale prices were low.”
Three of the other big six suppliers – British Gas, E.ON and SSE – have already announced they will keep prices on hold until the end of March. Hannah Maundrell, editor-in-chief of comparison site money.co.uk, said the price hikes were unfair.
EDF is cutting gas prices but will raise electricity charges in April. “This is a slap in the face for many already struggling families,” she said. “It’s is a stark reminder that we all need to be tightening our purse strings to cope with price rises and looking where we can make savings.”
Npower is the second of the big six suppliers to announce price rises, after EDF Energy said in December its standard dual fuel direct debit price will increase by 1.2% to £1,082 a year.
Martin Lewis, founder of MoneySavingExpert.com, said the remaining four of the big six providers were likely to follow and urged consumers to take matters into their own hands by demanding a cheaper deal.
“Almost certainly by the end of April we will have seen all the big six firms having hoicked their prices by between 5% and 10%,” he said.
“Do not groan, moan or whinge. Take action. Everybody, with every firm, should make sure they’re on the very cheapest tariff. The best thing to do is a whole-of-market comparison, but even if you’re not willing to do that, call up your existing company and say ‘Am I on your cheapest deal?’ Most people aren’t, and hundreds can be saved just by one phone call.”
A spokesman for the Department for Business, Energy and Industrial Strategy said the government was concerned about npower’s decision to raise prices.
“This government is committed to getting the best deal for households and is concerned by npower’s plans to increase prices for customers who are already paying more than they need to. Suppliers are protected from recent fluctuations in the price of wholesale energy, which they buy up to two years in advance, and prices remain significantly lower than in 2014,” he said.
“We expect energy companies to treat all their customers fairly and have been clear that, wherever markets are not working for consumers, we are prepared to act.”
The government is expected to address concerns about the energy market when it publishes a consumer green paper in the spring.
A two-year investigation by the UK’s competition watchdog concluded last June that 70% of domestic customers of the big six companies – British Gas, EDF, E.ON, npower, Scottish Power and SSE – were on expensive standard variable tariffs and could save more than £300 by switching to a cheaper deal.
As a result, customers have been paying £1.4bn a year more than they would in a fully competitive market, the Competition and Markets Authority found.