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Poorest homes in Britain ‘to be hit by electricity bill hike’

Up to 2.6 million of the poorest households could be slapped with huge heating bill hikes this winter, it has been revealed

The UK's most vulnerable households are those most likely to be affected by the rises

The UK’s most vulnerable households are those most likely to be affected by the rises

Four of the UK’s biggest energy companies have announced gas price rises of more than 9% on average. However, those who rely on electricity to heat their homes will be hit by an even bigger spike in prices.

Suppliers have increased their off-peak rates, with night-time charges rocketing by up to 35% in the past year. Experts have warned this is likely to impact on those who can afford it least.

Millions of homes rely on electricity

Many homes that do not have access to mains gas rely on electricity to heat their homes – this includes around 2.6 million homes with electric storage heaters. Many of these are installed in tower blocks and social housing.

This electricity is charged at two separate rates – on peak, during daytime hours, and off peak at night.

Storage heaters are designed to get round utility bills by using electricity at night during the cheaper hours, and then releasing the heat during the day.

Despite the rises, off-peak prices remain lower than daytime costs. However, this move will still see a substantial increase in the bills of some of the poorest people in Britain, with many of those affected being struggling families and pensioners. A large proportion of the people affected are on the Economy 7 tariff.

SSE first to bring in price rises

SSE is to be the first to introduce a winter price rise, when it increases bills by around 8.2% this Friday.

Daytime rates for Economy 7 customers will go up 8%, but the cost of night-time rates are to soar by 12%.

npower is also planning to push up prices, with the German-owned firm set to increase its average electricity prices by 9.3% from the beginning of December.

However, customers on Economy 7 will see a 10% jump in their peak rate, and this comes on the heels of last year’s 15% jump.

According to The Mirror, Derek Lickorish, chair of the Fuel Poverty Advisory Group, said that SSE had increased its off peak prices by 35.6% in just one year.

He underlined that those who will be hit hardest by this increase in off peak prices will also have to deal with the fact that various green taxes are added to electricity bills rather than gas. Despite this, these customers do not get to enjoy the full benefit of such schemes.

He added: “In general we’re talking about some of the poorest households who are coming off worse through no fault of their own.

“It is something I have written to the Secretary of State about because these off peak users are being clobbered.”

Ofgem comments

Energy regulatory Ofgem commented that this is an “important segment of the market”.

“There are a variety of Economy 7 tariffs in the market. We advise customers to look at their day/night time rate and compare prices based on their own usage,” it advised.

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