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Energy firms pledge to curb price rises

Published on 03 December 2013 03:00 PM

Fuel bills are set to rise less than expected after energy companies pledged to pass on savings following a Government overhaul of green levies

British Gas will cut dual-fuel bills by an average of £53 from 1 January, although that is still less than half the rise imposed on customers last month.

 

Other energy companies made similar pledges, with SSE customers in line for a saving of around £50 as the company said it anticipates a reduction of around 4% in dual-fuel bills before the end of March.

Npower said it has no plans to increase its prices before spring 2015 unless wholesale costs or network charges rise.

The announcements follow confirmation from the Chancellor George Osborne of a reduction in the cost of some energy-efficiency and social schemes as part of this week's Autumn Statement.

Home energy bills should fall by on average £30-£35 next year as a result of the Government's decision to cut the cost of the energy company obligation (ECO), an insulation scheme delivered by the big energy suppliers.

News of falling prices also follows concerted Government efforts to regain the initiative on energy costs, with the issue having dominated the political headlines since Labour leader Ed Miliband said he would freeze prices for 20 months if he wins the general election.

Taxpayer to pay subsidy

The Department of Energy and Climate Change has announced a rebate on the warm homes discount for people in fuel poverty.

As a result of this move the average customer will see their bill reduced by £12 for the next 2 years, although the taxpayer will instead pay for the subsidy.

And a one-off reduction of around £5 on electricity bills will come about as a result of voluntary action by electricity firms to reduce network costs in 2014/15.

British Gas said its gas and electricity prices will be cut by an average of 3.2%, which equates to a saving of £41 on an annual dual-fuel bill, with an additional £12 rebate for the Government's warm home discount scheme.

Just a fortnight ago, however, around £123 was added to the average annual bill for British Gas customers when the company increased its electricity bills by 10.4% and gas tariffs by 8.4%.

Wholesale energy prices, the cost of Government energy initiatives and higher network charges for delivering power to customers' homes were blamed for the price rises.

Copyright Press Association 2013

Last updated: Oct 06 2017

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