E.ON’s chief executive has admitted that it is now extremely likely the company will be increasing what it charges after it announced a fall in its profits in the third quarter of the year.
E.ON is the only one of the big six providers in the UK yet to announce price rises this year after EDF revealed a 3.9% increase earlier this week, but it is not likely to hold this crown for much longer.
Profit fall = price rise
Tony Cocker, managing director of E.ON’s UK arm said that the company has been battling to keep prices low, adding that it was “holding back any increase for our customers for longer than any of the other large energy suppliers.”
However, the firm revealed earlier this week that it has seen its third quarter profits fall by 11%, a reality that will see bill hikes in the near future.
The company has seen its profits drop from £52 million last year to £46 million in the same three-month period in 2013, while its retail division saw losses yet again.
These rose from £6 million a year ago to £37 million this year.
While E.ON has yet to release any details of its projected price rises, many expect that they will sit at about 6%, generally in the middle of where its rivals have pitched theirs.
Uncontrollable costs to blame
Ahead of the expected rises, E.ON has moved to blame the government and the costs that it said are outside of its own control.
Cocker insisted that the costs the company was able to control, such as running contact centres, had fallen over the last year, but that those imposed on the firm had increased over the same period.
Green levies and the energy companies obligation (ECO) have been the target of other members of the big six in their price rise announcements.
“Whilst we will not comment on speculation, it is fair to say that we are being put in a position where it is increasingly likely that we will need to pass on some of these increases in costs to our customers. This is always a last resort and, as was the case last year, we are holding back any increase for our customers for longer than any of the other large energy suppliers,” Cocker added.